Quick Answer: Series 65 for CPAs
CPAs are uniquely positioned to add investment advisory services. The Series 65 allows you to offer comprehensive financial guidance that complements your tax and accounting expertise.
- PFS alternative: The AICPA Personal Financial Specialist credential waives the Series 65 requirement
- Study time: 40-60 hours (4-6 weeks for most CPAs)
- Best timing: Study after tax season (May-September)
- Your advantage: Financial statements, ratios, and compliance are familiar territory
If youâre a CPA, your clients already trust you with their most sensitive financial information. They come to you for tax planning, but their real questions often go deeper: âAm I saving enough for retirement?â âShould I sell this investment?â âHow do I minimize taxes on my portfolio?â The Series 65 exam gives you the credentials to answer these questions directly.
This guide covers why CPAs add investment advisory services, how your accounting background helps with the exam, optimal study timing around tax season, and practical steps to expand your practice.
Why CPAs Add Investment Advisory Services
The line between accounting and financial planning has blurred significantly. Clients expect their trusted advisors to provide comprehensive guidance. CPAs who add investment advisory services can meet this expectation while building more sustainable practices.
The Traditional Model: Referral Relationships
Most CPAs refer investment questions to financial advisors. While this maintains professional boundaries, it has limitations:
- Clients receive fragmented advice from multiple professionals
- Tax-efficient investment strategies require coordination thatâs often lacking
- You lose touch with clients between tax seasons
- Revenue opportunity goes to external advisors
The Integrated Model: CPA-Advisors
CPAs who add investment advisory services can transform their practices:
Recurring Revenue
Advisory fees provide stable, recurring income that smooths out seasonal tax revenue fluctuations. Most advisors charge 0.5-1.5% of AUM annually.
Year-Round Client Contact
Investment management keeps you connected to clients between tax deadlines. Quarterly reviews replace the annual tax appointment cycle.
Tax-Optimized Investing
You can implement strategies most advisors canât, like tax-loss harvesting timed to your clientâs specific tax situation.
Deeper Client Relationships
Managing investments alongside taxes makes you indispensable. Client retention improves dramatically.
According to the AICPA, wealth management is one of the fastest-growing service lines for CPA firms. Major firms like Innovative CPA Group are launching dedicated investment advisers (RIAs) to capture this opportunity. Smaller firms are following suit.
Tax Practice Synergies
Tax planning and investment management are deeply interconnected. CPAs who handle both can deliver superior client outcomes by coordinating strategies across disciplines.
Integrated Service Opportunities
| Tax Service | Complementary Advisory Service |
|---|---|
| Tax preparation | Portfolio review; identify tax-loss harvesting opportunities |
| Retirement plan administration | 401(k) investment selection; participant education |
| Tax projection and planning | Roth conversion analysis; capital gains timing |
| Business consulting | Owner retirement planning; buy-sell funding |
| Estate and gift tax returns | Inherited account management; beneficiary planning |
| Quarterly estimated taxes | Portfolio income projections; withholding optimization |
The âSingle Point of Contactâ Advantage
When clients have separate CPAs and financial advisors, coordination often breaks down. The CPA doesnât know about the advisorâs planned trades. The advisor doesnât know about the CPAâs tax projections. The result is suboptimal outcomes for clients.
As a CPA-advisor, you eliminate this coordination problem. You can:
- Time capital gains realization based on actual tax situations
- Coordinate Roth conversions with low-income years
- Match charitable giving strategies with investment gains
- Optimize retirement account withdrawals for tax efficiency
- Plan business income distributions around investment decisions
CPA firms offering integrated tax and investment services often charge 10-20x more than compliance-only fees. Clients willingly pay for coordinated advice that saves them money.
Your tax knowledge gives you an edge on Series 65 topics. Practice with:
- Tax Considerations Questions (4 questions)
- Retirement Plans Questions (3 questions)
These questions test tax-efficient investment strategies where CPAs naturally excel.
Your CPA Skills Transfer
Financial statement analysis? You already know it. CertFuel's Smart Study algorithm recognizes your strengths and accelerates you through Section I topics. Our system focuses your limited study time on investment products (Section II) and state regulations (Section IV).
Access Free BetaStudy Approach for CPAs
Your accounting training gives you meaningful advantages on the Series 65, but there are areas that require dedicated attention. Hereâs how to approach the exam strategically.
The Exam Structure
The Series 65 (Uniform Investment Adviser Law Examination) consists of 130 scored questions (plus 10 unscored pilot questions) with a 180-minute time limit. You need 71% (92/130) to pass.
Exam Content Breakdown
30% - Laws, Regulations, and Guidelines (~39 questions)
Securities regulations, fiduciary duty, ethics. Your advantage: Regulatory compliance is familiar to CPAs.
30% - Investment Recommendations and Strategies (~39 questions)
Portfolio management, client suitability, retirement planning. Mixed: Some overlap with tax planning work.
25% - Investment Vehicle Characteristics (~32 questions)
Stocks, bonds, mutual funds, ETFs, options. Focus area: Requires dedicated study time unless you have investment experience.
15% - Economic Factors and Business Information (~20 questions)
GDP, inflation, monetary policy, financial statements. Your advantage: Financial statement analysis is CPA territory. Review financial reporting questions to confirm your mastery.
Your Strengths as a CPA
- Financial statement analysis: Balance sheets, income statements, cash flow statements, and ratios are core CPA knowledge.
- Regulatory interpretation: You understand compliance frameworks from GAAP, GAAS, and tax regulations. Securities regulations will feel familiar.
- Mathematics: Time value of money, compound interest, and yield calculations are extensions of accounting math.
- Ethics training: AICPA Code of Professional Conduct prepares you for investment adviser ethics questions.
Areas Requiring Focus
Unless you have an investment background, plan to spend significant study time on:
Investment Products
- Equity securities (common stock, preferred stock) - Debt securities (bonds, yield calculations) - Mutual funds and ETFs - Options (calls, puts, basic strategies) - Variable annuities and insurance products
Economic Concepts
- GDP, inflation, unemployment indicators - Monetary and fiscal policy - Business cycles and leading indicators - Interest rates and yield curves - Balance of trade
Portfolio Theory
- Modern Portfolio Theory basics - Risk measurement (standard deviation, beta) - Asset allocation strategies - Performance metrics (alpha, Sharpe ratio) - Diversification principles
Practice applying these concepts with capital market theory questions.
Timing: Study After Tax Season
For most CPAs, the optimal study window is May through September. Hereâs why:
- Mental bandwidth: Tax season consumes all available focus. Donât compete with it.
- Extension season: September 15 and October 15 deadlines create a natural study pause.
- Scheduling flexibility: Book your exam for June or July when you control your calendar.
- Fresh start: Begin studying May 1 with 4-6 weeks of uninterrupted preparation time.
Recommended Study Timeline
Most CPAs can prepare in 4-6 weeks with 10-15 hours per week:
| Week | Focus Area | Hours |
|---|---|---|
| 1-2 | Investment products (securities, funds, options, annuities) | 20-25 |
| 3 | Economics and portfolio theory | 10-12 |
| 4 | Client suitability and recommendations | 8-10 |
| 5 | Regulations, ethics, fiduciary duty (quick review) | 5-8 |
| 6 | Practice exams and weak area review | 10-15 |
Focus your limited study time where it matters most. As a CPA, you can:
- Skim quickly: Financial Reporting Questions (4 questions) - you know this
- Review ethics: Fiduciary Obligations Questions (3 questions) - compliance mindset transfers
- Study deeply: Investment product questions (fixed income, equity, pooled investments) - unfamiliar territory
- Master regulations: Regulation of Investment Advisers Questions (4 questions) - essential for RIA setup
This targeted approach reduces study time from 60 to 40-50 hours.
Aim to score consistently above 75% on practice exams before taking the real test. Dedicate the last 20-25% of your study time to practice questions. This builds speed and identifies weak areas.
For busy CPAs learning unfamiliar investment products, spaced repetition flashcards are an efficient study method that maximizes retention while minimizing time investment.
The PFS Alternative: Exam Waiver
CPAs have a unique option: the AICPA Personal Financial Specialist (PFS) credential. Earning the PFS waives the Series 65 exam requirement in most states.
What Is the PFS?
The PFS is the highest-requirement financial planning credential available. Itâs exclusively for CPAs and combines your existing CPA credential with advanced financial planning knowledge.
Series 65 vs. PFS Credential
| Requirement | Series 65 | PFS Credential |
|---|---|---|
| CPA Required | No | Yes |
| Experience | None | 3,000+ hours in personal financial planning |
| Exam | Series 65 (130 questions) | CFP exam, ChFC exams, or PFS exam |
| Cost | $187 exam fee | $299-500+ application and exam fees |
| Time to Complete | 4-6 weeks | Varies (experience requirement is limiting factor) |
| Credential Value | License to advise | Enhanced marketing credential + Series 65 waiver |
When PFS Makes Sense
- You already have 3,000+ hours of personal financial planning experience
- You want a credential that differentiates you from non-CPA advisors
- You plan to market financial planning as a core service
- Youâve already passed the CFP or ChFC exams (satisfies PFS exam requirement)
When Series 65 Makes Sense
- You want to start advising clients as quickly as possible
- You donât yet have 3,000 hours of financial planning experience
- You plan to affiliate with an RIA rather than market your own credential
- Cost is a consideration (Series 65 is significantly cheaper)
Many CPAs pass the Series 65 first to start serving clients, then earn the PFS later to enhance their credentials. The Series 65 doesnât prevent you from pursuing PFS.
Compliance Considerations
Adding investment advisory services creates dual compliance obligations. You remain subject to AICPA and state board ethics rules while also following securities regulations.
Key Regulatory Frameworks
| Aspect | CPA Practice | Investment Advisory Practice |
|---|---|---|
| Governing Body | State Board of Accountancy; AICPA | SEC or state securities regulator |
| Primary Rule | AICPA Code of Professional Conduct | Investment Advisers Act of 1940 |
| Fiduciary Standard | Objectivity, integrity, due care | Duty of care and duty of loyalty |
| Conflicts Disclosure | Required; some situations require withdrawal | Full disclosure in Form ADV and client agreements |
| Fee Disclosure | Written engagement letter recommended | Form ADV Part 2A disclosure required |
| Continuing Education | Varies by state (typically 40 hours/year) | 23 states require IAR CE (typically 12 hours/year) |
Understanding these dual regulatory frameworks is critical. Practice regulation of investment advisers questions and fiduciary obligations questions to master the compliance requirements that distinguish advisory work from tax practice. The fiduciary duty standard requires advisers to act in clientsâ best interests at all times.
Independence Considerations
If you provide attest services (audits, reviews, compilations), investment advisory services create independence impairments:
You generally cannot provide investment advisory services to clients for whom you perform attest engagements. The financial interest and management participation create independence violations under both AICPA and SEC rules.
For tax, consulting, and other non-attest clients, investment advisory services typically donât create independence issues. This is why many CPA-advisors focus their advisory practice on tax clients.
Structural Options
Most CPA firms handle investment advisory services through one of these structures:
- Affiliated RIA: Create a separate legal entity (LLC or corporation) registered as an RIA. The CPA firm and RIA share ownership and resources but maintain distinct compliance programs.
- Individual IAR affiliation: Individual CPAs affiliate with an external RIA as Investment Adviser Representatives while the CPA firm stays out of advisory services.
- Hybrid platforms: Use a turnkey RIA platform that handles compliance while you maintain your brand identity.
Best Practices for Dual Practice
- Separate engagement letters: Use distinct agreements for accounting and advisory services
- Clear role identification: Specify which capacity youâre acting in for each engagement
- Comprehensive disclosure: Document all potential conflicts in Form ADV
- Professional liability coverage: Ensure both CPA E&O and investment advisory coverage
- Compliance calendar: Track both CPA CE and IAR CE requirements
Expanding Your Practice: Structural Options
After passing the Series 65, you have several options for adding investment advisory services. Each has different implications for independence, compliance burden, and revenue potential.
Option 1: Affiliate with an Existing RIA
RecommendedJoin an established RIA as an Investment Adviser Representative while maintaining your CPA practice separately.
- RIA handles compliance, technology, and [custody](/series-65/glossary/custody-rule/)
- Lower startup costs
- Focus on clients, not operations
- Access to established investment models
- Revenue split with RIA (typically 70-90% to you)
- Less control over investment philosophy
- Must follow RIA's compliance policies
Option 2: Launch an Affiliated RIA
Create and register a separate RIA entity owned by you or your CPA firm.
- Full control over investment philosophy and fees
- Keep 100% of advisory revenue
- Build equity in a saleable business
- Customize compliance to your practice
- SEC or state registration requirements
- Compliance program development
- Technology and custody relationships
- Higher startup costs ($10,000-$50,000+)
Option 3: Hybrid RIA Platform
Use a turnkey RIA that provides infrastructure while you operate under your firmâs brand.
- Compliance support without full RIA burden
- Maintain your firm's brand identity
- Access to institutional investment products
- Faster time to market
- Platform fees (basis points on AUM)
- Some constraints on investment choices
- Less customization than independent RIA
Revenue Potential
Investment advisory fees typically run 0.5% to 1.5% of assets under management (AUM) annually. For context:
| AUM | Annual Fee (1%) | Monthly Revenue |
|---|---|---|
| $5 million | $50,000 | $4,167 |
| $10 million | $100,000 | $8,333 |
| $25 million | $250,000 | $20,833 |
| $50 million | $500,000 | $41,667 |
Your existing tax clients often have significant investable assets. Converting even a portion of your client base to advisory relationships creates substantial recurring revenue that smooths seasonal fluctuations.
Getting Started: Your Path Forward
Hereâs a practical roadmap for CPAs looking to add investment advisory services:
Decide: Series 65 or PFS
If you have 3,000+ hours of financial planning experience and want the credential, pursue PFS. Otherwise, start with the Series 65 to get licensed faster.
Plan Your Study Timeline
Schedule your exam for May, June, or July to study after tax season. Register through FINRA using Form U10. Exam fee is $187. Avoid common study mistakes that waste time during your limited study window.
Choose Your Structure
Decide whether to affiliate with an existing RIA, start your own, or use a hybrid platform. Consider your time availability, capital, and desired level of control.
Handle Registration and Compliance
File Form U4 with your chosen RIA (or Form ADV if starting your own). Establish written supervisory procedures and compliance policies.
Update Your Professional Liability Coverage
Ensure your insurance covers investment advisory activities. You may need a separate E&O policy for advisory services.
Launch With Existing Clients
Start with tax clients who already trust you. The conversation is natural: âWeâve been handling your taxes for years. Now we can also help manage your investments.â
Before offering advisory services, review your client list for any attest engagements. Those clients generally cannot receive investment advice from you without creating independence impairments.