(360) 281-6495 john@BoatDollars.com

I am asked from time to time if I am a certified financial planner (CFP). I am not. There is a lot of confusion out there about exactly what all these “credentials” mean, so if you are so inclined I have provided a detailed (and mind numbing) explanation of the financial services certifications and licenses below. However, here is the shorter answer…

What it really comes down to is that all these certifications and almost all the licenses described below revolve around stock market investing. I could make a case that the majority of the CFP, CFA and Securities Licensing training is essentially a Wall Street indoctrination program – coupled with some common sense personal finance wisdom that pretty much anyone, can get from any number of sources, virtually free…

My philosophy regarding the stock market is very simple. Today’s stock market is a rigged shell game and a house of cards. Most of us do not have the excess capital, the time or the sophistication to make stock market investing more than plain and simple casino gambling.

Sadly, I believe that is also true of the vast majority of financial planners out there. Instead of you gambling with your money, you are gambling on them, gambling with your money…

The bottom line is that unless you have reached a point where your future financial security is 100% certain, you have no business gambling with your resources. I call it Critical Capital Mass. After you achieve Critical Capital Mass and you have some extra money and want to take your chances in the Wall
Street casino, go for it! Maybe you’ll get lucky.

What this means is that about 99% of people should have ZERO dollars “invested” in stock market based assets – that’s mutual funds, 401K’s, IRA’s, Roth IRA’s, Brokerage accounts, etc., etc. So my only “investment” advice to almost everyone is: “Don’t put ANY money in these types of stock market based accounts and if you have money in these types of accounts already, get it out.”

Most securities licensed CFP’s are in the business of selling you stock market based products like IRA’s, mutual funds, etc. Some securities licensed CFA’s and CFP’s are in the business of helping you pick the right stocks, bonds, mutual funds, etc., and may “manage” your money for you. An RIA may also be CFA or CFP. RIA’s do all of the above, but get paid a fee for their time, versus a commission on the products they sell you.

These folks live and work in a Wall Street world. I do not. Therefore, I am not a CFP or a CFA or an RIA. I do not hold any securities licenses because I do not analyze, pick or recommend buying or selling any specific stock market based products. Again, my only “investment” advice is not to be in the stock market casino at all.

The only type of license that fits with my financial philosophies and my actual business practices is an insurance license. As for a fiduciary responsibility to put my client’s interest first; I just thought that was business (and decent human being) 101 and my plain ole insurance license already requires that of me anyway… And if you want to know how I get paid, just ask me…

The strategies I use and recommend are simple, have NO exposure to the stock or real estate markets and have been used with wild success by savvy families for over 160 years. While this closely held strategy has been called by a number of names, Bank On Yourself is the most widely known. To learn more about it, download this value packed Bank On Yourself special report now:

Now for the mind numbing explanation:

First of all there is a big difference between a “certification” and a license. Licenses are issued by government regulatory agencies, “certifications” are awarded by private companies when someone has jumped through a particular set of hoops, established by that private company. Two common “certifications” are the CFP and CFA.

CFP – Certified Financial Planner: A professional certification for financial planners conferred by Certified Financial Planner Board of standards Inc., a private, non-profit corporation formed in 1985.

CFA – Chartered Financial Analyst:  A professional certification offered internationally by the American-based CFA Institute (formerly the Association for Investment Management and Research, or AIMR), a private, for-profit, corporation formed in 1999.

A person can earn these certifications when they have completed a combination of college level study, CFP and/or CFA specific programs of study and some level of field experience working directly under an executive with higher level certifications.

A CFP or CFA may (or may not) also be an RIA.

RIA – Registered Investment Advisor: manages the assets of high net-worth individuals and institutional investors. He or she must register with the Securities and Exchange Commission (SEC) and any states in which he or she operates.

Pretty much every CFP, CFA and RIA will hold one of a dizzying array of securities licenses…

Securities Licensing: Licenses issued to financial professionals by FINRA (Financial Industry Regulatory Authority) or NNSA (North American Securities Administrators). There are various levels of securities licensing:

Series 6 (FINRA): allows its holders to sell “packaged” investment products such as mutual funds, variable annuities and unit investment trusts (UITs).

Series 7 (FINRA): Authorizes licensees to sell virtually any type of individual security. This includes common and preferred stocks; call and put options; bonds and other individual fixed income investments; as well as all forms of packaged products (except for those that also require a life insurance license to sell).

Series 3 (FINRA): Authorizes licensees to sell commodities futures contracts.

Series 63 (NNSA): All series 6 and 7 licensees must also carry this license, known as the Uniform Securities Agent License and is related to the Uniform Securities Act.

Series 65 (NNSA): This license is required for investment advisors who provide investment advice and money management services for an hourly or other type of non-commission related fee.

Series 66 (NNSA): Essentially combines the series 63 and 65 licenses into one.

Clear as mud?

If you’d like to discuss a financial strategy that is simple, predictable and backed by contractual guarantees, schedule a free consultation call with me. It’s just a casual 15 – 20 minute chat to find out if the strategies I use and recommend might be a good fit for you and your family.