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Is there anything to my Financial Advisor having a Vice President title?

Admit it, you’re impressed.

And then they admitted it. They weren’t really thrilled with the attention they were getting, or the performance, or the communication, or the fees… but one thing anchored their love for their current advisor; he was a Senior Vice President, at this big name firm...


Apr 28, 2012 by Scott from Manhattan Beach, CA in  |  Flag
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7 votes

Typically, this title is only used with representatives that work with a Broker/Dealer, versus fee-only advisors that are registered as Investment Advisors only.

A "Vice President" title usually means that the individual is what is called a "Registered Principal" for a Broker Dealer. This means that he has taken the FINRA Series 24 or 26 test and is now registered with the authority to approve financial transactions. The financial transactions approved may be the sales of other advisors - or merely his own.

Generally, this title means that the individual acts as a "franchisee" for a broker dealer. A more familiar term is "Branch Manager," or "OSJ (Office of Supervisory Jurisdiction) Manager. In simplest terms, that means that a part of this person's job may include recruiting, training, and supervising other representatives for the broker dealer.

The easiest way to tell on the business card is that a Vice President will usually have (perhaps in small print) a disclosure that says "Registered Principal," while a financial advisor who must have his transactions approved and has an "upline" who takes a "haircut" from his commissions will usually have a disclosure that says "Registered Representative."

None of this means anything about the level of service that you receive. Many very successful financial advisors have no desire whatsoever to recruit and train other advisors, and are happiest when working with clients.

Jon Castle http://www.WealthGuards.com

3 Comments   |  Flag   |  Apr 29, 2012 from Jacksonville, FL
Scott Andrew Bell

Definitely not how it works in a wirehouse.

Flag |  Apr 29, 2012 near Manhattan Beach, CA
Jonathan N. Castle, MSFS, CFP®

Scott I was never in a wirehouse. Why don't you share your knowledge, then?

Flag |  May 12, 2012 near Jacksonville, FL
Scott Andrew Bell

I did. In the link I referenced.

Flag |  May 12, 2012 near Manhattan Beach, CA

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6 votes

I was a Vice President at one of my former securities firms. I have to admit, it did look good on my business card. It did impress my fellow students in my CFP classes. It impressed my wife. It even impressed my mother. In fact, some people I knew professed shock that I would leave a firm at which I had risen to such a lofty title. But what did it really mean? It meant that I was empowered to sign certain documents for the firm so the President didn't have to be bothered. I had no real input in the direction of the firm or it's operations beyond the most mundane day-to-day decisions. But it did LOOK impressive. In most large investment firms, titles are awarded to representatives based on their sales. If the person was truly a Senior Vice President with actual management responsibility (aside from "sales management"), he/she wouldn't be serving retail clients in the first place. Investors better serve their own interests when they focus on the aspects of the relationship that truly matter like "the attention they were getting, or the performance, or the communication, or the fees" than on worthless titles.

Comment   |  Flag   |  Apr 28, 2012 from Redmond, WA

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2 votes

No. It may mean that they have a few years of work experience (as few as three), but nothing more.

Comment   |  Flag   |  Apr 28, 2012 from San Francisco, CA

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Scott Bell's answer is very complete. So, I will simply back up what he's saying. I was with a Wall Street firm for 22 years, ending as a Sr. Vice President. The title was based almost entirely on production -how much revenue was generated for the firm over the course of the year. It was partly based on longevity yet the hurdle was low. It was definitely NOT based on competence, capability, integrity, or results for the clients. Caveat emptor.

Comment   |  Flag   |  May 16, 2012 from San Diego, CA

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The most common benefit offered to those working in financial services firms (banks, insurance and brokerages) is to "promote" someone to Vice President. My experience with the title comes from my days in banking. In the wirehouse world, I found it based primarily on production. When someone produced enough, he might be encouraged to join the ranks of "registered principals" as noted above which might even allow that person to branch out or recruit others beneath him - to collect that haircut fee mentioned earlier.

Comment   |  Flag   |  May 17, 2012 from Amesbury, MA

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