Interested in becoming a financial advisor? You'll likely wind up taking the Series 6 exam, a multiple-choice test designed to license many financial professionals. Here, we'll provide some background on the Series 6 licensing exam, explain who needs to take it, tell you the subjects you'll need to know to pass it, and offer tips on passing it.
What is the Series 6 exam?
The Series 6 exam is a licensing test administered by the Financial Industry Regulatory Authority (FINRA). Also known as the Investment Company and Variable Contracts Products Representative Qualification Examination, the test allows people who pass it to represent a broker-dealer in the purchase of mutual funds, variable annuities, variable life insurance, unit investment trusts, and municipal fund securities.
The Series 6 is typically taken after a candidate passes the Securities Industry Essentials (SIE) exam, which tests people's proficiency in fundamentals, regulatory agencies and their functions, product knowledge, and acceptable and unacceptable practices.
People who want to take the Series 6 exam must be sponsored by a FINRA member firm or self-regulatory organization. Successful candidates will typically work as financial advisors, insurance sales agents, or wealth management advisors, among other positions. Licensed professionals are required to take regular FINRA-designed regulatory and firm-designed continuing education courses to keep their registration current.
The content in the Series 6 exam
People who take the test have 90 minutes to answer 55 questions. The test, which carries a $70 registration fee, covers four major job functions:
- Half of the questions on the test are designed to assess a person's ability to provide customers with information about investments, make recommendations, transfer assets, and maintain appropriate records.
- One dozen questions test a person's ability to seek business from customers and potential customers for a broker-dealer.
- Eight questions are designed to test a candidate's knowledge of the procedures for opening an account after determining a customer's financial profile and investment goals.
- Five questions test a person's ability to obtain and verify purchase and sale instructions and process, complete, and confirm transactions.
Another five questions are randomly placed throughout the exam and are not scored. Successful candidates must correctly answer 35 questions for a score of 70%. It's possible to retake the test after failing, although there's a 30-day waiting period. After a third failed attempt, the waiting period grows to 180 calendar days.
Passing the Series 6 exam tips
Although the Series 6 test isn't the only FINRA exam given to professionals, it's known for having a low pass rate, with fewer than 60% of candidates getting a passing grade of 70% or better.
To maximize your chances of success, reputable test preparation companies recommend that candidates:
- Create a structured study plan. It should be a priority to follow a schedule that covers everything, with extra attention paid to difficult topics.
- Take practice tests. Many practice questions are available online. Successful candidates will take advantage of the opportunity to gauge their progress.
- Use what works best. Some people study best alone, others in small groups, and still others work better one-on-one with tutors or colleagues.
- Understand concepts. Successful Series 6 candidates don't just memorize potential answers; they take time to understand the concepts being addressed.
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