How To Become A Financial Advisor: 5 Licenses You Need

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Good things take time, like studying for and passing several exams to become licensed as a financial advisor

Exams? Yes.

And if you’ve always been told that you’re a bad test taker or you don’t feel like doing extra reading on top of your already busy day, you might pass on this opportunity altogether.

But what if putting in the time and energy to pass a few exams could be just what you need to fulfill your potential and reach your career goals?

We’ve seen many career changers thrive in this industry with the right preparation and guidance. Here at Consolidated Planning, we strive to ensure that our financial advisors have every tool and resource at their disposal to build a meaningful, thriving financial advising practice. 

And building that practice starts with securing your insurance and investment licenses.

The process of becoming a financial advisor can be overwhelming and take a good deal of time to achieve. We’re here to help you understand the necessary requirements and licensing, the ideal timeline, and the support you can expect to receive in order to help you decide if the effort of becoming a financial advisor is the right decision for you and your goals.

Licenses You Can Get Before You’re Associated With A Financial Advising Firm

Part of your commitment to becoming a financial advisor means securing licenses ahead of choosing your firm. These licenses include the Life & Health (LAH) Insurance exam, Long-Term Care Insurance (LTC) exam, and the Securities Industry Essentials® (SIE) exam.

Since requirements and testing varies from state-to-state, we will use North Carolina for our default here.

Life And Health Insurance License

Life And Health Insurance (LAH) are arguably the most common types of insurance, outside of auto insurance, that consumers need. This licensing allows you to advise on and sell life and disability insurance in the state that you are licensed in.

With this license you will help advise your clients on what best suits their needs based on where they stand today and where they want to go. This should not be a one-size fits all approach but rather tailored policies for your client’s needs.

The requirements for your Life & Health License depends on your state. For the State of North Carolina, you are required to complete 40+ hours of studying to qualify to take the exam.

Long-Term Care Insurance License

To secure your Long-Term Care (LTC) Insurance license in North Carolina, you are required to complete the initial 8-hour NAIC Partnership training course followed by the examination. This license allows you to advise on and sell long-term care insurance to your clients.

Through this course and examination, you will understand the state programs, and other private and public coverage of LTC services that may best suit your clients and their long term needs. While we can’t predict the future, LTC coverage helps protect your client should a chronic illness, disability, or injury compromise their income.

Securities Industry Essentials® License

The Securities Industry Essentials® (SIE®) exam is a prerequisite to take the qualification exam. With this introductory-level exam, you will have an understanding of the basics of the securities industry, including concepts, products, structures of the market, and regulatory functions.

This exam will allow you to take the next step with a firm to advise and sell investments.

At Consolidated Planning, you will need to obtain these licenses before your welcome day as your offer is contingent on passing these exams. The expected timeline for taking and passing these exams is dependent on what your life looks like right now.

  • Are you employed full-time?
  • Do you have obligations outside of your “normal” working hours?

Because of the necessary exam preparation, focus, and the possibility of having to retake exams (which we hope to avoid), this process can take several months if these factors are true for you.

While some firms may only require one or the other – either insurance or investment licenses, advisors at Consolidated Planning are building a consultative, not transactional practice. This means you’ll typically be working with both insurance and investments, providing true planning for your clients.

The hope with these licenses is you will have long-term relationships with your clients. And overtime, as their needs change, you can assist in identifying and shifting coverage if necessary, whether that’s adding or reducing coverage.

If you contract with Consolidated Planning, you will have access to online course materials and virtual live instruction through ExamFX for exam preparation. In addition to that, after your first 90 days, you will be reimbursed for your first attempt of your LAH, LTC and SIE exams.

Once you’ve chosen the best firm for you, you can begin taking steps to achieving your licenses that require affiliation with a firm.

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Licenses You Can Get After You’re Associated With A Financial Advising Firm

Once you’ve passed your Life & Health and SIE licenses, you will set your sights on your next exams – the Series 7 and Series 66. These licenses are necessary for the sale of investment related products, services, and for charging fees for clients.

And since you will be learning the ins and outs of a new industry, it’s safe to say that you might need some guidance in identifying the best ways to adequately prepare for your Series 7 and Series 66 exams.

Even if you think you don’t, you do. Always accept the help that is offered to you in your career as a financial advisor.

Series 7 License

The Series 7 exam or the General Securities Representative Qualification Examination is a co-requisite to the Series 66 exam. This license allows you to purchase and/or sell all securities products on behalf of your clients.

Series 66 License

The Series 66 exam or the NASAA Uniform Combined State Law Examination is a co-requisite to the Series 7 exam. This license allows you to provide investment advice and securities transactions for clients.

Taking these exams doesn’t necessarily need to happen right away. 

What will likely need to happen right away is setting exam dates. Not only does this show a commitment but it helps you best manage how you spend your time. 

At Consolidated Planning, the thought process behind this helps us backfill what learning needs to happen and when based on your exam dates. Here is what your learning will look like:

  • ExamFX: This state-of-the-art learning platform is available to all new advisors at no cost. ExamFX helps you prepare for your exams by utilizing recorded events, live events, practice exams, and more. Through your studying efforts with ExamFX, you can easily monitor your progress, performance, sessions, and scores to best help keep you on track.
  • Study Hours: Similar to the process of our block calendar, we suggest you determine a certain time of day that is optimal for you to study most effectively and actively schedule the time for it. We want to help you hold yourself accountable here.
  • Weekly Virtual Office Hours: Throughout your preparation process you will have access to advisors for general questions, suggestions, best practices and study habits to implement.

Focusing to the best of your ability on passing these exams, allows you to begin solely focusing on building your practice and finding clients.

Is A Career In Financial Advising Right For Me?

The fear of taking these exams shouldn’t be the reason you don’t fulfill your goals and potential in a career as a financial advisor.

Because your first year as a financial advisor will be an important one, having a clear path to becoming a licensed advisor can help lay the groundwork for the trajectory of your career.

Maybe you’re thinking a career in financial advising is right for you, but wondering why you need to take these exams. Well, at Consolidated Planning these licenses allow you to do more by offering both the insurance and the investment side of the business, including:

  • Offering your clients solutions regardless of their needs
  • + Creating multiple revenue streams for yourself

Reach out to our recruiters to discuss the interview process and how you can start building a meaningful, thriving practice.

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2023-152915 Exp. 3/2025

Published:  March 24, 2023