Investment Advisory Representative (IAR)

Posted on by user

Investment Advisory Representative (IAR)

Key takeaways
* An IAR is a licensed individual who provides personalized investment advice and manages client accounts on behalf of a registered investment adviser (RIA) firm.
* IARs must register with state regulators or the SEC, pass required exams (commonly Series 63/65 or Series 66 + Series 7), and meet fiduciary and record‑keeping obligations.
* RIAs are firms; IARs are the people who deliver advisory services for those firms.
* Advanced credentials (CFP, CFA) are optional but can enhance expertise and career prospects.

What an IAR does

An Investment Advisory Representative (IAR) is a financial professional employed by or associated with a registered investment adviser (RIA) who:

  • Provides personalized investment recommendations and financial planning.
  • Manages client accounts and portfolios, including discretionary trading when authorized.
  • Communicates investment strategy, risks, and performance to clients.
  • Prepares and maintains documentation of advice and client communications.
  • May offer public advisory content (e.g., market commentary) or supervise and train junior advisers.

RIA vs. IAR

  • Registered Investment Adviser (RIA): the legal entity (firm) that offers advisory services and registers with the SEC or state securities regulators.
  • Investment Advisory Representative (IAR): the individual authorized to provide advice and act on behalf of the RIA. The terms are not interchangeable except when a single individual forms and operates an RIA.

Regulatory and professional obligations

  • Registration: IARs must register with the appropriate state securities authorities in the states where they advise clients. Registration typically involves filing Form U4 through the Central Registration Depository (CRD). Firms register via Form ADV in the Investment Adviser Registration Depository (IARD).
  • Exams and licensing: Common pathways include passing the Series 65 (Uniform Investment Adviser Law Exam) or the Series 66 combined with the Series 7. Many states accept substitute credentials (for example, certain professional designations) in lieu of an exam.
  • Fiduciary duty: Under the Investment Advisers Act of 1940 and state regulations, IARs owe clients a duty of care and loyalty—putting clients’ interests ahead of their own and disclosing conflicts of interest.
  • Disclosure and documentation: IARs must disclose material risks and conflicts and maintain records of recommendations, transactions, and client communications to satisfy SEC/state record‑keeping requirements.
  • Continuing obligations: Some jurisdictions require continuing education or periodic renewals; requirements vary by state.

Typical qualifications and career development

  • Required: Passing the appropriate securities exams and registering with state/SEC authorities while working for a registered RIA.
  • Helpful but optional: Professional credentials such as Certified Financial Planner (CFP) or Chartered Financial Analyst (CFA) improve technical knowledge and marketability.
  • Experience: IARs often progress into supervisory roles, compliance, or portfolio management with experience.

How to become an IAR (overview)

  1. Join or associate with a registered investment adviser (RIA) firm.
  2. Register with the state(s) where you will advise clients (file Form U4 through CRD) and ensure the firm files Form ADV as needed.
  3. Pass required exams (Series 65 or Series 66 + Series 7, or meet a state’s substitution rules).
  4. Comply with ongoing fiduciary, disclosure, and record‑keeping obligations.

Benefits of being an IAR

  • Professional recognition and the legal ability to provide fee‑based investment advice.
  • Opportunity to manage client portfolios and build long‑term client relationships.
  • Clear regulatory framework and career paths within advisory firms.

Bottom line

IARs are the licensed professionals who deliver investment advice and manage portfolios on behalf of RIAs. Becoming an IAR requires registration, passing required exams, and adhering to fiduciary and record‑keeping standards. Advanced designations can enhance credibility, but the core responsibilities focus on providing tailored, compliant investment advice and acting in clients’ best interests.