Financial Services Licensing is More than a Mere Detail

Financial services licensing is more than a mere detail that you have to abide when you are entering the financial services world or the real estate world. Some states combine financial services licensing with real estate licensing. Other states consider these two disciplines to be separate and hold them under different licensing laws. However, as you start your journey into financial services licensing, it is imperative that you cooperate with the given laws of your state and that you do so before you start handing out any type of professional advice.

Bear in mind, that the law requires you to be licensed before handing out financial information and advice. But we do live in a strange and cocky world. There have been many cases where a little shop talk with some friends have resulted in sizeable law suits when the licensing came through after the friend lost his shirt. While no money was exchanged for the advice or the discussion, the laws are written for ample interpretation and in these cases those who sued claimed that the advisor was well on his or her way to becoming licensed and should have held off on discussing any information until after the license came through. Of course, I guess there is nothing to be said for personal responsibility about the decisions we make and suing someone is easier than stomaching a hard loss, but for those who are developing the early stages of their career the potential for career ruining accusations exists.

Some licensing laws are written with a little more flexibility in them. This doesn't mean that obtaining the appropriate licensing is an option or that it is something that can be put off until the appropriate time. In this country we require licenses for things to prove that we have at least a strong intention of doing only the positive and the willingness to learn our trade, craft, or other endeavor. We license people for fishing to ensure that they will follow the rules and we license people for driving to prove they were tested and their skills are passable. We require licenses for those who want to get involved in real estate or financial planning to make sure that they adhere to a certain standard. Those caught performing the job duties that are permitted only by license without having obtained one are in for quite a bit of trouble. The possible consequences are not worth the small time and money investment it takes to get the appropriate licensing.

Of course, a homeowner can sell his or her own home without a license and you are more than welcome to go online and invest only for yourself before you have acquired your license. But you simply can not help out a friend or charge a client as their financial advisor without the appropriate licensing from your state. Financial services licensing is an imperative step in becoming a solid and reputable financial planner or advisor.