Any financial professional worth the title has to keep up with the latest changes in industry rules and regulations and the latest enhancements in products and planning techniques used in the field. However, they have another incentive: Continuing education coursework is required for licensed or credentialed financial professionals.
- Continuing education is required of professionals in financial planning and insurance fields.
- Licensed and credentialed financial professionals are required to keep up to date on new regulations and other changes in the industry.
- Requirements for insurance professionals are different in each state.
Below are the continuing education (CE) requirements for financial professionals. They include the regulatory element, the firm element, state-approved education for insurance professionals, and continuing education for professional designations.
As you'll see, there are ways to streamline the process so that you won't find yourself buried under a pile of rules and regulations when your continuing education deadline rolls around.
But first, consider who needs which coursework.
Each license or designation comes with its own continuing education requirement.
For example, a stockbroker who is also a certified financial planner® (CFP®) must fulfill a number of CE requirements, including:
- A FINRA-approved regulatory element for the Series 6 or Series 7 license
- A FINRA-approved firm element for the Series 6 or 7 license
- State-approved CE for all insurance licenses, such as life and health
- CFP® board-approved CE coursework for the CFP® designation
- Certified Asset Protection Analyst (CAPA)
The Regulatory Element
The FINRA-approved regulatory element is divided into subsections for three groups of professionals:
1. Series 6 licensees
2. Series 7 licensees
3. Those who supervise securities licensees.
All licensees have 120 days to complete this portion of their continuing education requirements after they have been licensed for two years. The requirements will then come due every three years for as long as the licensee maintains FINRA registration.
The coursework and exams are available from online sources.
The regulatory element covers essential rules and regulations, compliance, sales, and communication issues, as well as supervisory topics for registered principals.
The Firm Element
Firm element CE applies to a financial professional considered by FINRA to be a covered person. That includes anyone involved in the sales or trading of securities in virtually any capacity.
Firm element training is created either by the company or obtained from outside sources and is implemented at the broker-dealer level yearly.
The course focuses on changes within the industry from one year to the next. It tends to be most relevant for financial planners because it covers practical topics such as new product training and the latest strategies that may generate new business for planners.
State-Approved Education for Insurance Licensees
There are no uniform federal requirements for insurance continuing education. Each state has its own CE program that agents and brokers must satisfy to maintain licenses to practice in the state.
Each state also sets the minimum number of required hours of CE that must be periodically met by licensees.
It is the responsibility of the licensee to know what the CE requirements are in the state or states where they intend to practice the insurance business.
Continuing Education for Professional Designations
Financial planners who have earned professional credentials such as the CFP®, chartered life underwriter (CLU), or chartered financial consultant (ChFC) designations will have additional continuing education requirements that go beyond what is needed to maintain their licensure.
For example, certified financial planner® practitioners must complete at least 30 hours of continuing education every two years. Two hours of this coursework must be in ethics training, while the remaining 28 hours can be derived from any financial educational topic or coursework that has been approved by the CFP® Board of Standards.
All other professional designations, in addition to those listed above, have separate continuing education requirements as well. Some examples include the CPA, enrolled agent (EA), Life Underwriter Training Council Fellow (LUTCF), and registered health underwriter (RHU).
Complete the Courses Online
Continuing education requirements are much easier to complete than they were in the pre-internet days. There are a number of excellent providers of approved CE materials online, including WebCE.com and AI Insight.
These sites allow you to select and pay for a relevant course and complete the final exam online. Some sites even report the results directly to the required states or designation boards.
Getting Credits Across Multiple Designations
It is important to know that many hours of coursework can be credited toward more than one license or designation.
For example, a great deal of the coursework approved by the CFP® Board of Standards for continuing education also counts toward fulfilling insurance or securities CE requirements. These hours may also count for other designations, such as the CLU or ChFC.
The same course will probably be credited with a different number of hours by different institutions.
For example, consider a CFP® practitioner with a life insurance license, who takes a course on life insurance from an online provider. The licensee may discover that their state of residence grants a particular course six hours of CE credit, while the CFP® Board of Standards considers the course to be worth only four and a half hours of credit toward fulfilling its CE requirements.
To maximize the efficiency of your coursework, find out in advance how many hours of credit each institution will allow for a given course.