To sell securities or provide financial advice, professionals must hold the appropriate licenses. These vary based on factors like the types of securities being sold, the nature of the financial transactions involved and the specific advice offered. The Financial Industry Regulatory Authority (FINRA) manages the licensing process for many of these credentials. It’s also responsible for upholding qualification standards and administering the necessary exams. Here’s an overview of the primary securities licenses.
Consider working with a financial advisor as you look for expert help with your investments or retirement planning.
Securities Industry Essentials
The Securities Industry Essentials (SIE) Exam is an entry-level test designed for individuals looking to start or resume a career in the securities industry. This exam evaluates a candidate’s understanding of industry fundamentals, key financial products, regulatory agencies and their roles, as well as practices that are both permitted and restricted within the industry. To become a registered representative with a FINRA member firm, candidates must also pass a “top-off” exam, such as the updated Series 6, Series 7 or another qualification exam relevant to their specific job responsibilities.
Series 6
The Series 6 license means you can sell investment products that include:
- Mutual funds
- Variable annuities
- Variable life insurance
- Unit investment trusts (UITs)
- Municipal fund securities, like 529 savings plans
While financial professionals can get this license, so can insurance agents who sell variable life insurance and annuities.
If you’re looking to get the Investment Company and Variable Contracts Products registration, you’ll need to pass the Series 6 exam as well as the Securities Industry Essentials (SIE) exam. The Series 6 exam is 90 minutes long and costs $75.
Series 7
For those looking to get the General Securities Representative registration, you’ll need to pass the SIE exam as well as the Series 7 exam. This license gives you permission to sell much more than a Series 6 license — almost any type of security — including:
- Public and private stocks and bonds
- Mutual funds
- Money market funds
- ETFs
- UITs
- Real estate investment trusts (REITs)
- Hedge funds
- Government securities
- Direct participation programs (DPPs)
- Securities traders
- Options on mortgage-backed securities
- Venture capital
- Rights
- Warrants
- Repos and certificates of accrual on government securities
- Sale of municipal securities
This series is best for stockbrokers, some financial planners and advisors as well as some insurance agents. The Series 7 exam is almost four hours long and costs $300.
Series 3
The Series 3 license is for those who want to sell commodity futures contracts. This license is more specific than Series 6 or 7 and is generally reserved for those who specialize in selling commodity futures.
The National Commodities Futures exam is from the National Futures Association (NFA) but administered by FINRA. It’s two hours and 30 minutes and costs $130.
The Series 31 license is like a subset of the Series 3 license. It allows you to sell futures managed funds.
Series 63
Stockbrokers or those who want to sell stocks, bonds, mutual funds or annuities, you’ll need a Series 63 license. Formerly known as the Uniform Securities State Law Exam, it’s required by each state and you’ll also need to have the Series 6 and 7 licenses. It focuses on the ethical and fiduciary obligations that one must uphold as an investment professional. North American Securities Administrators Association (NASAA), an international organization centered on investor protection, handles the licensing requirements for this. The exam fee is $147 and the test lasts 75 minutes.
Series 65
The Series 65 license, also known as the Uniform Investment Adviser Law Examination, is best for financial planners, advisors or others that provide financial advice. Stockbrokers or those who handle managed-money accounts would also need this license. This exam was created by the NASAA. The fee is $187 and the exam lasts three hours.
Series 66
The Series 66 license, officially called the Uniform Combined State Law Examination, essentially combines Series 63 and 65. If you’ve already earned both of these licenses, you don’t need to take the Series 66 exam. However, if you haven’t, you can skip taking two exams and instead take one. The Series 7 exam is a co-requisite. The fee is $177 and the exam lasts two hours and 30 minutes.
The experts suggest you set aside 75 to 100 hours of study time before taking the test. Most people with full-time jobs can break this down into four to eight weeks of study sessions.
Series 79
This exam, also known as the Investment Banking Representative Exam, is for financial professionals who deal with:
- Mergers and acquisitions
- Asset sales
- Financial restructuring
- Debt and equity offerings
- Tender offers
- Corporate reorganizations
- Business combination transactions
To get the Investment Banking Representative, you’ll need to pass the SIE exam as well as the Series 79 exam. The Series 79 exam is two hours and 30 minutes long and costs $300. Those who pass the exam can work as entry-level investment bankers.
Bottom Line
For financial professionals aiming to join firms, agencies or other financial institutions, obtaining the right licenses tailored to their specialty is essential. For investors, understanding your financial advisor’s area of expertise is crucial. Knowing they have passed specific exams to certify their expertise can provide added peace of mind.
Tips for Investing
- Series licensing is one of many factors to consider when you’re choosing a financial advisor to manage your money. Finding a financial advisor who offers you the help you can benefit from. If you don’t have a financial advisor yet, finding one doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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