For many financial advisors, professional designations are becoming increasingly important. These marks of academic and professional achievement, signified by lettered acronyms like CFA or CFP that appear after the advisor's name, distinguish them from the competition and suggest a higher level of competence, specialized knowledge and standard of professionalism.

However, in recent years, the number and scope of professional designations available has mushroomed exponentially and many advisors are now unsure of which credential will serve them most effectively, especially when it comes to specialized designations within the senior citizen market.

Here we will take a closer look at some senior designations and whether they are worth pursuing for those looking specifically at retirement planning, retirement income, longevity planning, and legacy/estate planning.

Key Takeaways

  • Many financial advisors are specializing in retirement planning and income.
  • As a result, these advisors have sought out targeted training and education to validate their expertise and skill in this segment.
  • Several professional credentials and designations are now available to signal expertise in senior financial planning - but not all of these are equal.

What Are Senior Designations?

Within the financial planning arena, a number of new designations have been created in recent years. These designations focus on the senior market, which includes those aged 50 and up. This demographic segment of financial planning consumers has become increasingly targeted from almost every direction by the financial services industry, including banks and insurance companies as well as independent financial and estate planners.

Legitimate Designation or Marketing Ploy?

Here are four main designations that financial professionals may use in the senior financial advice market:

Certified Senior Advisor

this is probably the best-known of the senior advisory designations. Offered and recognized by the Society of Certified Senior Advisors, candidates need to pass a certification examination on social, health, cultural, financial, and legal aspects of aging to attain it. Questions based on financial issues have a 22.2% weightage in the examination. There is no prescribed training or education program, but the SCSA offers various resources like textbooks and live courses and preparation usually takes 50-60 hours. Candidates are also required to complete 30 hours of continuing education and pass a criminal background check every three years to maintain their certification.

CSAs are typically professionals in different fields who work exclusively or often with the aging and want to supplement their professional knowledge with the designation. Many advisors who earn this designation work primarily with fixed or indexed annuities; however, there are also a number of non-financial professionals who carry this designation, including estate planning attorneys and health care professionals and administrators. CSAs are required to inform consumers that the designation alone does not imply expertise in financial, health or social matters. 

Certified Senior Consultant

Offered by the Institute of Business and Finance, this designation requires only 25 to 30 hours of self-study plus three exams, along with 15 hours of continuing education per year for the first five years. The coursework covers the basics of Social Security and Medicare, long-term care planning, annuities and other retirement income, elder care and other related topics.

Certified Senior Specialist

This designation is by far the most academically advanced of the senior designations. While it is not in the same category as the Certified Financial Planner (CFP) certification or other similar, established designations, it does contain a reasonably rigorous academic curriculum covering the following subjects:

  • Retirement income and planning
  • Income and estate tax planning
  • All types of annuities
  • Social Security, Medicare and Medicaid
  • Long-term care and elder care issues
  • Demographics of the senior market
  • Basic charitable and estate planning techniques
  • Reverse mortgages
  • Basics of investment selection

This credential, while hardly comprehensive, can at least provide advisors with a basic academic background for doing business with seniors.

Chartered Senior Financial Planner

The issuing organization of CSFP claims that it trains recipients in advanced retirement and estate planning strategies, and that the "Senior" in its name implies professional seniority as opposed to a demographic target market. However, only three days of academic training are required, followed by an open-book exam.

Broad Based Designations That Serve Seniors

While senior designations may differ substantially in the level of academic training that is required, it is clear that none of them can compare to the curriculums for established and respected designations such as the CFP, Chartered Life Underwriter (CLU) or Chartered Financial Consultant (ChFC).

In all fairness, most senior designations tend to cover senior demographics and issues relating to Social Security and Medicare in more detail than the major designations. If advisors wish to market their services to seniors, this is a legitimate market.

However, if they want to position themselves as "experts," they should seriously consider earning one of the more traditional, comprehensive designations first. Then they could earn one of the senior designations that focus specifically on senior issues. At that point, their competence in the senior market would mean a great deal more. They would also be subject to a code of ethics that can be enforced.

Pending Consequences

Unfortunately, many seniors have become the victims of scam artists and charlatans who are skilled in emotionally manipulating elderly clients and prospects into investing in products or services that often tie their money up for long periods of time.

As a result, state regulators have begun to take notice of both the inadequate academic training and the business approach taken by many senior advisory certificate holders. In fact, the state of Nebraska has issued a statute prohibiting advisors from using this or any other senior advisory designation.

Many other states can also cite a marked increase in the number of investigations and complaints relating to senior advisory firms in recent years. One of the main limitations that regulators face when dealing with this problem is that there is no overarching agency that monitors the financial designation community like there is for insurance or securities licensing. Therefore, any "rogue" credential must currently be dealt with on a state-by-state, individual basis.

The Bottom Line

While the differences between designations such as the CFP and the Certified Senior Advisor may be apparent to those in the business, most seniors looking for financial advice may have difficulty comprehending the gap in training between the two, at least at first glance. Although it would be unfair to label every financial professional who holds a senior advisory designation as dishonest, the increasing pressure coming from state regulators is making the future of these designations uncertain.

Advisors who are considering whether to pursue a senior advisory designation may want to check with their state's insurance commissioner and/or securities bureau before enrolling in a program. While bogus designations can fool prospects and clients at least for a while, regulators are certain to eventually rectify the situation, one way or another.