Creating and sticking to a financial plan is challenging, if not impossible for many Americans. That’s why some enlist a financial advisor or consultant to keep them on track. Some partner with a Registered Financial Consultant (RFC) to do so. Read on to discover how an RFC can help you achieve your financial objectives.
What Is a Registered Financial Consultant (RFC)?
A Registered Financial Consultant (RFC) is a financial professional who has proven their understanding of the financial services industry. RFCs have demonstrated a high level of competency. They have also proven that they are well equipped to design financial plans personalized to their client’s specific needs.
The International Association of Registered Financial Consultants (IARFC) gives out the RFC designation to eligible financial professionals who apply. The IARFC is a non-profit organization that fosters the public’s confidence in financial professionals. They do this by helping financial consultants exchange planning techniques, ensure they meet their ethical standards, and offer continuing education to keep their skills sharp.
Registered Financial Consultant (RFC) Qualifications
All applicants must have at least three years of experience as a practitioner in the financial planning or services field. Additionally, a RFC applicant must have one of the following educational requirements:
- A professional designation including: AAMS, CFA, CFP, ChFC, CLU, CPA, EA, LUTCF
- A Series 65 Securities license or have one of the following license combinations: Series 6 & 63, Series 6 & 66, Series 7 & 63, Series 7 & 66
- A life insurance license.
- A bachelors’ degree or an advanced degree in business, finance, economics or a related field.
- Applicants can also meet the educational requirement by completing the entire course requirements for the following IARFC designations: RFA, RFC or MRFC.
Unlike other certifications, there is no coursework or exam requirement. However, all applicants must agree to adhere to the International Association of Registered Financial Consultants’ code of ethics. They also must pay a $100 application fee and a $250 membership and designation fee.
Once an applicant has received the RFC designation, they must complete a series of continuing education credits. Every two years, all RFCs must devote a minimum of 40 hours to continuing education credits. Each credit must fall under personal finance or professional practice management topics. Four hours of their continuing education credits must focus on ethics.
Financial Consultants vs. Financial Advisors
Tthe terms financial consultant and financial advisor tend to be interchangeable. That said, many financial advisors may refer to themselves as financial consultants. This is because both professionals offer their help in making complex financial decisions. Many financial advisors and consultants are experts when it comes to creating financial plans suitable for your specific needs.
Both professionals may have studied economics, accounting, or finance during their college years. You may even find some professionals with MBAs or other advanced certifications. For example, one of the most highly regarded certifications is the Certified
Financial Planner (CFP) designation, but there are many others that can add value.
For instance, other than the RFC designation, the chartered financial consultant (ChFC) designation is another certification you may see consultants carry. This designation is often used as alternative to the CFP mark. The Institute of Financial Consultants issues ChFC designations once an applicant completes five online modules, completes 20 hours of continuing education credits, and passes an online exam. The core of the programs for the CFP and ChFC designations are very similar, but ChFC certifications require a few additional elective courses in financial planning.
However, the consultant designation doesn’t require an inclusive board exam like the CFP designation. Yet, both CFPs and ChFCs can give you financial recommendations based off of you individual financial situation.
How to Find a Registered Financial Consultant (RFC)
It’s important to note that everyone has a different financial situation. Some financial consultants and advisors are experts with certain topics. Others only work with certain investors who have a specific net worth. That’s why it’s important to find a financial advisor who fits your financial needs. You can use online search tools or ask for referrals from friends and family who are in a similar stage of life and financial circumstance.
Once you have a few candidates in mind, you can use BrokerCheck to verify a consultant’s credentials and background. Next, create a list of questions that will help you gain more insight into their practice. These questions can include their fee structure, account minimums, expertise, clientele, and certifications and investing philosophy. Make sure to meet with a few candidates before you make your final decision.
The Bottom Line
The one of the most important factors to consider when choosing an advisor is their certification(s) and expertise. It wouldn’t be beneficial to work with a financial advisor or consultant who doesn’t have the knowledge, education, or background in the specific area you need help with. It would be like going to a dermatologist for a cardiac issue.
- If you’re still having trouble tracking down a Registered Financial Consultant, there are other tools that can help you locate one. Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
- Do you know how much your investment needs to grow before you can cash in? How much will taxes and inflation take from your total? SmartAsset’s investing guide can help answer those questions and determine your tolerance for investment risk.
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