Becoming a Financial Planner in Delaware

The Delaware Department of Labor expects job growth in the financial advisory industry, projecting that 344 new personal financial advisor jobs will be added in the state during the current ten-year period ending 2018. Securities, commodities and financial services sales agents should see 66 new jobs added in the state during that time, while insurance sales agents, many of whom offer annuities and act as financial planners, can expect 174 new jobs to be added.

Delaware offers advantages to investors that most other states do not. The state is one of the few that offers directed trusts. These trusts separate the administrative function from the invest­ment function, allowing trust clients to appoint their own investment advisor trustee. Many wealthier individuals are drawn to Delaware because the state imposes no fidu­ciary income tax on irrevocable trusts that accumulate capital gains and/or income for future distribution to nonresident beneficiaries. Many of Delaware’s high net worth residents with estate planning needs elect to have investment advisors help them establish such trusts.

Delaware is known for its small geographical footprint as compared to other states, but both its population and its economy are growing. Information supplied by the Delaware Population Consortium shows positive population projections. In 2000, the state’s population was 786,408. By 2010, that number had grown to 895,173. The state’s population is expected to exceed one million in the coming years with projections of 1,019,497 residents by 2025 and 1,120,523 by 2040.

According to 2009 U.S. Census Bureau figures, a large percentage of Delaware’s population, 14.3 percent, is over the standard retirement age of 65. As Delaware’s growth trend continues, the population of retirees and residents approaching retirement age will see proportional increases. The Census Bureau’s 2009 American Community Survey showed that a significant percentage of Delaware households, about 23 percent, had some form of retirement income. This is considerably higher than the national average of 17.4 percent. These facts bode well for those interested in becoming financial planners committed to the responsible and prudent management of Delaware’s higher net worth retirees.

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How to Obtain an Investment Adviser Representative License in Delaware

The Delaware Securities Division licenses all investment adviser representatives (IARs) and investment adviser (IA) firms that work with state residents. All IAs and their representatives register through the Financial Industry Regulatory Authority’s (FINRA’s) IARD (Investment Advisor Registration Depository) system. Examinations that must be passed before licensure is granted include the North American Securities Administrators Association’s (NASAA’s) Series 65 (Uniform Investment Adviser Law Examination), or the FINRA Series 7 (General Securities Representative Examination) in combination with the Series 66 (Uniform Combined State Law Examination). Under the Delaware Securities Act, those who hold one of the following professional designations are exempt from taking these exams: Certified Financial Planner (CFP), Chartered Financial Consultant (ChFC), Personal Financial Specialist (PFS), Charted Financial Analyst (CFA), or Chartered Investment Counselor (CIC).

Some of the well-known Investment adviser firms with offices in Delaware include Mallard Advisors and Diamond State Financial Group, both with offices in Newark; and Charles Schwab, Ameriprise Financial, Merrill Lynch, Goldman Sachs, and BlackRock Advisors, LLC, all with offices in Wilmington. Morgan Stanley Smith Barney has offices located in both Lewes and Wilmington.

How to Obtain a Stockbroker License in Delaware

Broker-dealer agents, otherwise known as stockbrokers, are also registered with the Delaware Securities Division, as well as with FINRA through their Central Registration Depository (CRD). To become licensed, registered agents must take either the Series 63 (Uniform Securities Agent State Law Examination) or Series 66 (Uniform Combined State Law Examination) along with the Series 7 (General Securities Representative Examination).

Continuing education must be taken by all securities representatives registered with the state. Under the rules of NASAA and FINRA, all registered securities representatives must take a web-based Regulatory Element course after two years in practice and every three years thereafter. The Firm Element, provided by the broker-dealer firms themselves, offers training to registered agents to keep them abreast of industry and internal business developments that have the potential to affect sales strategies and protocols, as well as the financial products the firm may offer.

How to Obtain a License to Sell Life Insurance and Fixed Annuities in Delaware

Delaware’s Department of Insurance licenses life insurance producers who may provide financial planning services through the sale of fixed annuities. No pre-licensing education is required in Delaware, but the Delaware life insurance producer examination, facilitated through third-party exam provider Pearson VUE, must be passed. Licensed life insurance producers in Delaware must take 24 hours of continuing education every 24 months, three hours of which must be specific to ethics training.

Selling variable annuities in Delaware as an insurance producer requires both life insurance producer licensure as well as a securities license issued after passing the Series 6 (Investment Company Products/Variable Contracts Limited Representative Examination). Continuing education requirements of both licenses must be upheld in order to maintain licensure.