Series 6 License vs Series 7

Confused about which securities license to pursue? Well you’re not alone. In the field of securities, the choice between a Series 6 License vs Series 7 is a critical one that can shape the future of your career in this industry.

To help you make this decision with more confidence, we’ve explored the requirements, benefits, and opportunities of each of these licenses in an easy-to-digest format below.

What’s the Difference?

What is a Series 6 License

The Series 6 license, also known as the Investment Company/Variable Contracts Products Representative Qualification, is a securities license that allows individuals to sell specific types of mutual funds, variable annuities, and variable life insurance policies on a client’s behalf.

It limits holders to selling only this narrow range of products, making it ideal for those wishing to specialize in these specific financial instruments. However, to be able to sell other types of securities, such as bonds, stocks, and options, additional licenses will be needed.

A Series 6 license opens up a number of opportunities in financial institutions like banks, brokerage firms, and insurance companies, with license holders commonly holding positions as financial advisors, investment associates, or insurance agents that offer advice, suggest investment objectives, and manage transactions.

The biggest drawback of this license is the inability to sell ETFs, which are generally replacing mutual funds as the preferred investment option. Despite this, the Series 6 license may be the best option for many financial advisors, as it represents a far cheaper and quicker route to getting licensed if you only intend to sell these types of securities products.

This, combined with the fact that it’s a less complex license to hold, makes it perfectly suited to beginners.

What is a Series 7 License

The Series 7 license, or General Securities Representative Qualification, is a securities license that enables a financial advisor to sell all securities products except commodities futures. This generally makes it more comprehensive and useful than the Series 6 license, as you’re not limited to selling just packaged investment products.

Instead, it can open up more job opportunities in competitive investment banking, private equity, and asset management roles since you’ll be authorized to provide a wider range of financial solutions, including mutual funds, municipal fund securities, corporate securities, investment company securities, and common and preferred stocks.

In particular, the Series 7 license is a fundamental prerequisite for stockbrokers in the security sector, who need to pass this exam along with the Series 63 exam to obtain their trading license.

The one drawback of this license when compared to the Series 6 is that it’s a far more expensive, time-consuming, and rigorous qualification. If you’re serious about passing the Series 7 exam on your first try, it’s essential to invest in study resources that will set you up for success.

Certification Requirements

Both licenses have specific requirements that you will need to satisfy in order to get licensed.

Ensuring that you understand the specific certification prerequisites of each one can go a long way in helping you prepare more effectively.

Series 6 License

Below, we’ve summarized the requirements of this less demanding and more cost-effective license:

• Eligibility: In order to be eligible to take the Series 6 exam, all candidates must first pass the Securities Industry Essentials (SIE) exam
• Cost: Candidates will generally need to pay a $75 fee before sitting the Series 6 exam
• Sponsorship: All candidates must be sponsored by a Financial Industry Regulatory Authority (FINRA) member firm or a self-regulatory organization (SRO) to be able to take the exam

When opting for the Series 6, keep in mind that the reason it’s relatively easier and less costly is because it limits your scope in terms of the financial products you can offer to clients.

Series 7 License

By contrast, the Series 7 is more exhaustive in terms of both the study material and the career opportunities it provides. As such, it demands much more stringent requirements of its candidates:

• Prerequisites: In order to achieve the General Securities registration, all candidates must pass the SIE exam in addition to the Series 7 exam
• Cost: Candidates are required to pay a much higher fee of around $300 in order to be able to take the Series 7 exam
• Sponsorship: Like the Series 6, you will also require sponsorship from a FINRA membership firm or other SRO in order to take the exam. If a candidate is sponsored by a FINRA-member firm, the Uniform Application for Securities Industry Registration or Transfer (Form U4) will be submitted

Going for the Series 7 means you’re aiming for a broader spectrum of opportunities in finance. It’s more challenging, not just in the types of questions you’ll answer in the exam but also in the breadth of material you need to cover. The cost is higher, but the potential benefits and career paths are also more expansive.

Which Qualification is Better for You?

Choosing between the Series 6 and Series 7 licenses is a pivotal step that can significantly impact your career trajectory in the financial industry. Your selection will dictate the types of financial products you’re qualified to handle, the roles you’re eligible for, and even the clientele you’ll primarily serve. While both licenses offer valuable entry points into rewarding careers, they diverge in their scope, complexity, and specialization.

Your decision should be aligned with various considerations including the products you want to specialize in, your ultimate career aspirations, and the level of commitment you’re willing to make in terms of both time and financial investment. This is not just a multiple-choice question on a test; it’s a strategic decision that will set the stage for your professional journey.

• Go for Series 6 If: You want to specialize in long-term packaged investment products, are new to the industry, or want a more cost-effective way to enter the finance world
• Opt for Series 7 If: You aim for a broad-based career in finance, want to deal with a variety of financial instruments, and are prepared to invest more in terms of study time and exam fees

Remember, your choice isn’t set in stone. Many financial professionals start with one license and add the other as they grow in their careers. Consider your options carefully, and make the choice that aligns best with your long-term goals.