In order to become a financial advisor in Washington, D.C. you’ll either register as an investment adviser representative (IAR) and find a position with one of the investment adviser (IA) firms in Washington, or go independent and establish an IA of your own. State level registration is processed with the District of Columbia Securities Bureau of the Department of Insurance, Securities and Banking, while federal level registration is processed with the Securities and Exchange Commission (SEC).
Your firm and all its representatives will conduct business in accordance with the D.C. Municipal Regulations.
Step 1. Get Your Education
Before gaining experience, your education is of highest importance. All employers place emphasis on formal degrees when making hiring decisions and potential clients will often consider your level of education. The educational background of all financial advisors is readily available through the online Investment Adviser Public Disclosure (IAPD). Most financial advisers in Washington, D.C. have at least a bachelor’s degree.
The degree you hold may be in any field, but the demanding nature of personal finance makes specialized degrees more valuable. This is especially true among new financial advisers. Some of the most useful degrees to consider include:
- BA or BS-Accounting
- BA-Consumer and Family Financial Services
- MS or MBA-Finance
- MS-Personal Financial Planning
- MS or MBA-Accounting
- MBA-Accounting and Finance
These degree programs will include coursework in the following areas:
- Behavior of organizations, persons and groups
- Business communications
- Business ethics
- Computer information systems
- Business law
- Quantitative applications in business
Step 2: Register Your Firm in Washington, D.C.
(If you plan to work as an IAR for an established firm, skip to Step 3.)
Investment adviser firms managing less than $100 million in assets and designating their primary place of business as Washington, D.C. will be considered state-level registrants and will operate under the regulation of the Washington, D.C. Securities Bureau of the Department of Insurance, Securities and Banking. Those firms that manage more than $100 million qualify for federal level registration through the Securities and Exchange Commission (SEC). Both state and federal level registration is processed through the Investment Adviser Registration Depository (IARD) by following the steps below.
- Obtain access to the Web-based systems required to complete registration by submitting Entitlement Forms by postal mail to FINRA Entitlement Group, 9509 Key West Ave, Rockville, Maryland 20850 or by fax to FINRA Entitlement Group at 301-216-3721. After approval of Entitlement, access the FINRA Firm Gateway and complete the remaining steps.
- Once you have approval of your entitlement, you will be able to set up a Central Registration Depository (CRD) general account. The CRD account is needed to pay all the required registration fees, and to submit registration for individual representatives within the firm. Fund the account to cover:
- Test fees for yourself as needed and for all IARs in your firm’s employ
- Initial registration fee distributed to the IARD of $40 if your firm will be managing less than $25 million in assets, $150 if your firm will be managing between $25 million and $100 million, and $225 if your firm will be managing more than $100 million in assets
- Initial registration fee distributed to Washington, D.C. Securities Bureau of the Department of Insurance, Securities and Banking of $250 for the firm and $45 for each individual IAR in the firm’s employ
- Submit Form U-4 Uniform Application for Securities Registration or Transfer for each IAR in the firm’s employ, yourself included, and submit it through the Central Registration Depository (CRD).
- Submit Form ADV through the IARD system. You will identify Washington, D.C. as the state you’re registering in on the ADV. Although it is not a state, registered investment advisers doing business in Washington, D.C. are still referred to as state-covered investment advisers.
- The Securities Bureau requires the mailing of several documents as part of the registration process. The items below need to be mailed to the Washington, D.C. Securities Bureau, Department of Insurance and Securities Regulation, 810 First Street, NE, Suite 601, Washington, D.C. 20002:
- A surety bond of $10,000.
- Firm financial statements
Step 3: Get Your Registered Investment Adviser License by Taking the Required Exams
The Washington, D.C. Securities Bureau and the Securities and Exchange Commission (SEC) will waive the Series 65 examination requirement for anyone holding at least one of the following professional designations:
- Certified Financial Planner (CFP) awarded by Certified Planner Board of Standards, Inc.
- Personal Financial Specialist (PFS) awarded by American Institute of CPAs.
- Chartered Financial Consultant (ChFC) awarded by The American College
- Chartered Financial Analyst (CFA) awarded by CFA Institute requires a bachelor’s degree at minimum but can be pursued by students in their last year of undergraduate studies
- Certified Investment Management Consultant (CIMC) previously awarded by Investment Management Consultants Association, this program is no longer available to new enrollees as the Association is no longer in existence.
- Certified Investment Management Analyst (CIMA) awarded by Investment Management Consultants Association.
- Chartered Investment Counselor (CIC) was previously awarded by Investment Council Association; this program is no longer available to new enrollees.
- Complete and Submit Form U-4 Uniform Application for Securities Registration or Transfer through the Central Registration Depository. As a firm principal, you will submit Form U-4 for yourself. As a firm employee, it will be submitted on your behalf.
When your exam application has been approved you will be notified to register for one of the following:
- The Series 66, Uniform Combined State Law Examination along with the Series 7, General Securities Representative Examination.
- Schedule the exam within 120 days of registration through one of the three exam locations in Washington.
- You should plan on arriving at the testing center about one hour before the scheduled exam time.
- You will receive your examination results immediately upon completion.
Step 4: Ongoing Renewal and Update Requirements
Investment Advisor Firm:
- Investment adviser firm renewals are done completely through the IARD
- Investment adviser representative renewals are done completely through the CRD
- License renewal needs to be completed before December 31st each year
- Washington D.C. renewal fees are $250 for the firm and $45 for each IAR working for the firm
- Renewal fees will have to be paid for all states in which the IAR is licensed
- Administrative fees of $100 are paid to the IARD
- Annual updates to the ADV are required to show changes to your fees and to employs in your firm
Investment Adviser Representatives:
As an investment adviser representative, your employing firm’s compliance department performs registration renewals. You are also expected to keep your Form U-4 current. Notify your employer’s Super Account Administrator within 30 days of changes that impact any of the following:
- Customer complaints
- Jurisdiction changes
- Residential address change
- Name change (marriage)
- Additional business activities
- Criminal record change
- Civil judgments
- Additional education
- Additional Certification
- Disciplinary action