No, CIMA isn’t a beverage. Know your flavours of financial advisor

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Making sense of the titles held by professionals in the financial advice space can be challenging. It’s one reason why the Family Enterprise Advisor designation (FEA) was created by Family Enterprise Canada about 10 years ago. The idea was to create a stamp of approval for all professionals working in the space.

Today, the FEA is on its way to becoming the gold standard for family offices, says Steve Legler, a family legacy guide based in Montreal who obtained the designation in 2014.

He was drawn to the program for its uniquely synergistic experience working with other professionals in the industry.

“We were forced to work as a collaborative team,” he says, adding that the intensity of the program meant he was able to create new partnerships. “You come out of the program being able to easily identify other people you could work with.”

The network of experts it creates can better serve family office clients, who require a multifaceted and tightly knit group of advisors to manage their financial needs. It also helps attendees understand the unique and complex needs of their clients.

Legler says the program has grown exponentially. “There is now a critical mass of FEAs,” he says, and many family offices now ask for advisors with that designation.

In addition to the FEA designation, professionals who work in multi-family offices come with a variety of designations and titles. Family offices are staffed with everyone from certified financial analysts (CFAs) to trust and estate practitioners (TEPs).

Who’s who in the family office world

Here are a few common titles and designations held by members of family office teams.

Investment advisor: An investment advisor provides investment advice or produces reports or analyses of investment securities for compensation. They can give advice on asset allocation or market trends.

Financial advisor: A financial advisor can help manage a family’s investments, buy or sell stocks, or create an estate and tax plan. Often brokers who buy and sell securities, they can also guide a family’s retirement planning, tax management and debt management. They do not, however, actively manage a family’s investment portfolio.

Wealth manager: Unlike an investment advisor, a wealth manager doesn’t choose products based on performance but rather on high-net-worth families’ personal goals and current finances when recommending products.

Investment fund manager or portfolio manager: Portfolio managers are focused on investing in, building and managing an investment portfolio. They actively manage portfolios.

Personal financial planners: A financial planner assists families in developing investment strategies to meet long-term financial goals. They might specialize in investments, taxes, retirement or estate planning. A personal financial planner might have one of the following licenses: Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), Chartered Financial Consultant (ChFC) or Certified Investment Management Analyst (CIMA) or Chartered Investment Manager (CIM).

• Certified Financial Planner (CFP): The CFP certification is the world’s most recognized financial planning designation. CFPs have the knowledge, skills and experience to handle their family office clients’ complete financial affairs. Their main focus is helping families attain their financial goals.
• Chartered Financial Analyst (CFA): This is one of the highest distinctions in investment management. CFAs have a background in investment reporting and analysis and concentrate their efforts on investment analysis and portfolio management, while providing deep knowledge of investment principles and ethics.
• Chartered Financial Consultant (ChFC): Those holding a ChFC designation have knowledge about financial topics such as estate planning, employee benefits, retirement, insurance and asset protection. They are also versed in small business planning, financial planning for households in the process of divorce, or for families who have special-needs dependents.
• Certified Investment Management Analyst (CIMA): This is an international, technical portfolio construction program for investment consultants, analysts, financial advisors and wealth management professionals. Focused on strategic financial management, it is the highest level of advanced investment education for client-facing advisors. CIMAs focus on asset allocation, ethics, due diligence, risk measurement, investment policy and performance measurement.
• Chartered Investment Manager (CIM): A CIM designation allows an individual to register with a provincial securities commission as a portfolio manager and to conduct discretionary portfolio management services for clients.

Chartered Professional Accountant (CPA): A CPA helps family enterprises with accounting and handles taxes and audits, financial accounting, taxation and business concepts.

Certified General Accountant (CGA): CPAs were formerly called CGAs. The CPA and CGA designations are the same.

Fellow of Chartered Professional Accountants: This designation is awarded to CPAs or CGAs who have delivered exceptional service to their clients. This is the highest honour awarded in the accounting profession.

Chartered Life Underwriter (CLU): CLUs provide wealth transfer and estate planning for their clients.

Trust and Estate Practitioner (TEP): A TEP is an internationally recognized designation identifying holders as specialists in trusts and estates. They can assist family enterprises with extensive estate planning and the creation of trusts.

Steve Legler says that what’s great about the FEA program is that it brings so many individuals with diverse backgrounds – CPAs, investment advisors, wealth managers and lawyers – to the table.

“The goal,” he says, “is to become fluent in family enterprise.”

More from Canadian Family Offices: 

• Married into wealth: Reflections on a life made ‘easier, not necessarily happier’
• Paying the absolute lowest in tax no longer top priority for today’s families
• Juliana Sprott: A Q&A interview
• Family moving abroad? Buying property? Beware local tax laws

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