The financial service industry drives me nuts. Everything is so stinking confusing!

 I could write a book about all the things I have seen that make me want to scream, but I won’t. I’ll just try and clear some things up here one topic at a time.

Just because someone is considered an “expert” in finance there are different levels of expertise, education requirements, and testing requirements.

I’ve generalized them into three levels (even though there are more.)

Level I

A financial coach, a financial counselor, a retirement specialist, agent, financial guru---all of these terms are for people who do not have credentials to be a financial advisor. They cannot put the words "financial advisor" on a business or any marketing material. Some of them may have an insurance license but other than that, I’m not sure of their education. They do not have the legal commitment to act in your best interest.

Level II

FINANCIAL ADVISORS-there are two basic groups here.

Group one has a Series 6 which means they can only give advice on mutual funds and variable annuities. They cannot sell stocks and bonds. Some have insurance licenses as well.

 Group two has a Series 7 which means they can sell almost every type of investment product out there, stocks, bonds, mutual funds, variable annuities, etc. It is a much harder license to obtain. Some have insurance licenses as well.

Level II

The 3 highest credentials for financial advisors. All of which are held to higher ethical standards. They are in no particular order:

Certified Financial Planner (CFP)- They must have a bachelor’s degree from an accredited institution; they must have three years of financial planning experience, they much complete the following graduate level classes in financial planning, investment planning, income tax planning, retirement planning/employee benefits, and estate planning before allowed to sit for the exam. The CFP exam is a six-hour comprehensive exam.

Chartered Financial Analyst (CFA)-They must have a bachelor’s degree from an accredited institution. They must have 48 months of experience in an investment related field, they must pass three exams (6 hours each) over several years with the focus being on accounting, economics, ethics, finance, and mathematics. Their focus is more investment related.

Personal Finance Specialist (PFS)- This person is already a CPA, (which is already a rigorous credential to obtain) who has studied personal financial planning, insurance, investing, retirement planning, and estate planning in order to pass an additional exam.

My message to you is make sure you know the level of financial professional you are working with.

Those of us who have worked hard at learning as much as we can to give the best advice that we can, take this very seriously and are NOT in any way offended if people ask.

The other take away for you is to find a person who is an expert in the area you need. Almost all, if not all of us, offer free consultations.