It can't be stressed enough that you should work with certified investment professionals. Each certification indicates that an individual is competent within a specific financial area. Without that certification it is hard to determine if the individual truly knows their stuff. Listed below are some of the more common designations in the investment industry:
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Certified Financial Planner (CFP)
Professionals with a CFP designation will have broad knowledge of all aspects of financial planning. The CFP must undergo years of testing and continuing education.
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Certified Fund Specialist (CFS)
This designation is offered by the Institute of Business and Finance (IBF) to financial services professionals who successfully complete its coursework and pass a comprehensive exam.
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Certified Investment Management Analyst (CIMA)
This certification requires coursework and a final exam and is administered by the Investment Management Consultants Association. Three years experience in the investment consulting field is also required.
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Certified Investment Specialist (CIS)
This is one step beyond the CIMA certification. It requires advanced concepts and strategies in asset analysis, tax planning and legal issues pertaining to investment consultants.
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Certified Public Accountant (CPA)
Becoming a CPA is a daunting task. First you must have an accounting degree, then CPAs must meet a 150 semester hour credit requirement, pass a four-part exam and complete at least one year of relevant experience. While CPAs may offer financial services, their specialty is tax issues.
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Personal Financial Specialist (PFS)
CPAs get this designation when they want to focus more on financial planning. They must have at least 250 hours of yearly experience in financial planning and have passed an additional exam.
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Chartered Financial Analyst (CFA)
This designation is one of the more difficult to obtain. The CFA must pass three examinations and accumulate three years of professional work experience. Many mutual fund managers, money managers and stock analysts have this designation.
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Chartered Investment Counselor (CIC)
To obtain the CIC designation the professional must first obtain a CFA designation, be employed by a member of the Investment Counsel Association of America (ICAA) and have five cumulative years of related work experience.
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Chartered Financial Consultant (ChFC)
The Chartered Financial Consultant must have completed multiple years worth of examinations and have knowledge in all areas including tax, estate, insurance, financial planning and portfolio management. Many ChFCs come from the insurance industry.
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Chartered Life Underwriter (CLU)
Professionals with the CLU designation complete a ten-course curriculum covering life insurance products.
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Chartered Mutual Fund Counselor (CMFC)
To obtain this designation you must complete a self-study program and final examination on different mutual fund topics. These professionals provide their clients with mutual fund advice.
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Chartered Retirement Planning Counselor (CRPC)
This designation is usually obtained by financial advisors that want to increase their knowledge of pre- and post-retirement financial planning.
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Chartered Retirement Plans Specialist (CRPS)
Many financial advisors add this designation to their credentials as this certification increases their technical skills in administering retirement plans for business clients.
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Registered Investment Advisor (RIA)
These professionals are usually registered with the Securities Exchange Commission (SEC) and generally charge a flat fee and/or an ongoing asset-based fee for their investment management services. (If they have less than $25 million under management then they register with their state). The SEC does not formally recognize "RIA" as an official title as they don't want to imply that these advisors have undergone a certification process.