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How to Get My License to Sell Investments

by Mark Applegate

Over the next decade, most of the nation's baby boomers will retire. Retirees seek a higher return on their investments than the minuscule yields that cash instruments, such as money markets and certificates of deposit, often provide. This increasing demand for higher returns will renew interest in investment sales, but you must be licensed to do so. There are several steps to becoming licensed to sell stocks, mutual funds, bonds and other financial services products.

Find a Sponsoring Employer

You must obtain licenses to become a financial services agent. The most common and important securities license is the Series 7 license administered by the Financial Industry Regulatory Authority, or FINRA. You must be sponsored by a licensed financial-services company to take the license exam. Seek an employer that provides a mix of investments. Apply to work for contingent on passing the required exams. Some firms pay expenses associated with this exam if you remain in their employ for a set period of time. This work experience helps you learn the industry, including how to choose stocks and assist customers.

Exam Preparation

Preparing for a license exam is critical. The Series 7 securities exam, also called the General Securities Registered Representative Examination, includes 250 questions. You are given six hours to answer. Most applicants study for several weeks, using exam-prep books, online tools or by attending a hands-on training "boot camp" that lasts one week or longer. Exam-preparation schools, while expensive, often guarantee you will pass the exam or they will pay for you to retake it.

Complete Your Training

Agents who pass the Series 7 exam often complete their training and certifications to match the products offered by the employer. The Series 6 and 63 exams provide an introduction to financial regulations and state laws pertaining to the industry. Some firms require prospective agents to pass these exams before letting them advance to the more challenging Series 7. These two certifications enable you to sell mutual funds and annuities, but only the Series 7 qualifies you to sell shares of common stock. Investment brokers vary as to which certifications they require and may pay the cost of taking the exams.

Other Considerations

A clean legal record is a must if you want to acquire and maintaining securities licenses. If you have been convicted of a felony -- especially while in a fiduciary capacity -- you face overwhelming hurdles to getting licensed. You must also agree to a two-part schedule of continuing education to get and maintain your license. This includes a computer-based training as you approach your second year in the industry and a structured training plan with your employer to stay abreast of changing financial-services laws.

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