Choosing a financial adviser IFA qualifications

If you consult an accountant, doctor or solicitor you expect them to be fully qualified to a high standard – so why should you accept anything less with your financial adviser?

However, unlike accountancy, medicine or law there is no one, high level, easily recognisable qualification consumers can trust when it comes to choosing a financial adviser. There are literally dozens of different financial qualifications, all issued by different bodies and meaning different things.

The basic qualifications

Nowadays, all financial advisers are required by their regulator, the Financial Services Authority (FSA) to pass examinations known as the Certificate in Financial Planning (Cert FP) or equivalent before they are allowed to provide financial advice. The Cert FP was previously known as the Financial Planning Certificate (FPC).

In addition, advisers giving mortgage advice must hold a mortgage qualification such as the Certificate in Mortgage Advice and Practice (CeMAP). However, qualifications such as the Cert FP and CeMAP are only basic level qualifications which allow advisers to practice – they don't demonstrate expertise or experience.

Higher level qualifications

Many advisers choose to go further and take additional, higher level, qualifications and we recommend you choose one of these more qualified advisers.
If you want a good all round financial adviser or planner, choose an adviser with one of the qualifications given below. Or, if you want an adviser that specialises in a particular area, choose an adviser that has one of the qualifications listed in 'Specialist advisers'.

More information on IFA qualifications and information on how to find an IFA can be found on the Unbiased website.

Advanced Financial Planning Certificate (AFPC)

This qualification is awarded by the Chartered Insurance Institute (CII), one of the main awarding bodies in the financial services industry. Advisers must take a minimum of 3 advanced exam papers from a variety on offer depending on what type of financial planning they want to specialise in.

One exam (G10) is compulsory and covers taxation and trusts. The AFPC has now been replaced by the Diploma in Financial Planning (see below), but the AFPC is still recognised for those advisers who already hold it, and is equivalent in value to the Diploma.

Diploma in Financial Planning (DipPFS)

This qualification awarded by the CII was introduced in 2006, and is designed to develop advanced technical knowledge and understanding across a broad range of advice areas including personal taxation, trusts, business taxation, pensions, investment and supervision.

Member of Personal Finance Society by Diploma (DipPFS)

The Personal Finance Society (www.thepfs.org) is the UK's main body for development of professional students in the financial services industry and is part of the Chartered Insurance Institute. When AFPC or Diploma in Financial Planning has been gained, professional membership of the Personal Finance Society is available.

Dip PFSs are required to follow the Personal Finance Society code of professional conduct and undertake Continuous Professional Development.

Associate of Personal Finance Society (APFS)

Awarded by the CII. This has now been replaced by the Advanced Diploma in Financial Planning (see below). However, many advisers will have already achieved Associate level within the Personal Finance Society and this qualification is still recognised. The APFS is equivalent in value to the advanced diploma qualification.

Advanced Diploma in Financial Planning (APFS)

Awarded by the CII. The Advanced Diploma in Financial Planning is a new qualification that enables professional advisers to develop their specialist planning capabilities. Upon completion of the Advanced Diploma advisers are eligible for ‘Chartered Financial Planner’ status.

Chartered Financial Planner

This is awarded by the CII, and is achieved by the adviser attaining a minimum of 290 exam credits including 180 Diploma level credits, or who have completed the Advanced Diploma in Financial Planning.

Chartered Financial Planners must also have five years' relevant industry experience and at least three years' continuous professional development. The adviser must agree to follow the CII's Code of Ethics and Conduct.

Certified Financial Planner (CFP)

This is awarded by the Institute of Financial Planning. It involves having either AFPC or Diploma qualification or equivalent from another professional body and three years' industry experience. The adviser must also successfully complete an assessed case study aimed at measuring the adviser's financial planning abilities and application of technical knowledge.

Holders of the CFP are required to maintain continuous professional development. Advisers can progress to become a Fellow of the Institute of Financial Planning (FIFP) by taking two additional six-hour examinations on both business and personal financial planning and once they have at least five years industry experience.

BSc (Hons) in Financial Services and Associateship (BSc (Hons) ACIB)

This is a degree level qualification in financial services awarded by the Institute of Financial Services.

Associate of Chartered Insurance Institute (ACII)

The original high level qualification taken by people employed in the financial services industry. Its primary focus is on general insurance but exams covering life insurance and pensions are available. Most IFAs now tend to sit the Diploma in Financial Planning or Advanced Diploma instead of the ACII.

Achievement of the ACII is broadly equivalent to Chartered Financial Planner. Advisers can progress to being a Fellow of the Chartered Insurance Institute (FCII) with further exams and industry experience.

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