The majority of people who obtain the series 6 and 63 licenses will be required to pass the exam by their employer. When you are joining a financial services firm as a condition of employment, individuals are required to obtain both the series 6 and 63 license to function in their job. Others may have been with the firm for a while and are now changing roles or perhaps being promoted into a position that requires the series 6 and 63 license. The firm’s compliance department, home office or HR will notify individuals directly or through their managers as to the time frame for taking the series 6 and 63 exams. Many Insurance companies, banks and limited broker dealers all require their agents to obtain the series 6 and 63 licenses .
A series 6 license is required for those who wish to conduct business in open end investment company products, commonly known as mutual funds. A series 6 license will also allow a representative to offer closed end investment company shares on the initial offering only. You will not be allowed to trade closed end funds or ETFs in the secondary market. Once you have obtained a series 6 license, you will need to obtain your series 63 license to be allowed to conduct business with the public in the various states across the US. One of the products that may be sold by a series 6 registered representative is variable annuity. Agents who wish to conduct business in variable annuity and variable life contracts will be required to obtain a life and health insurance license in their home state. Most agents who obtain a series 6 license will wish to conduct business in variable annuities and will pursue an insurance license, if they have not already done so.
Obtaining a series 6 and 63 license is a significant challenge. You must pass two tests and doing so takes focus and dedication to the exam preparation process. You should not try to take the series 6 and 63 licensing exams on the same day. In fact, you should not even open the book for the series 63 until you have successfully completed the series 6 exam. Some agents try to take both exams on the same day and very few, if any, are successful. Trying to prepare for two exams that cover material which is significantly different is not something we recommend. History has shown us that this approach causes many people to fail not one, but both exams. We recommend that agents start with the series 6, take a few days off then while in “study mode”, get to work on the series 63. This process should not be taken lightly and students who prepare to take the exam should prepare thoroughly for both exams. There are no shortcuts and students should make studying a priority. We recommend at least 50- 60 hours of preparation to ensure you pass your series 6 exam and 35-40 hours for the series 63 exam. One both exams are passed an agent will become licensed to sell investment company products and variable annuity contracts. ( life and health license required for variable annuity contracts )
Even though many believe that their series 6 and 63 licenses are transferable, in actuality they are not. If you wish to change employers your series 6 and 63 registrations / licenses be must be terminated by your current employer. Your former employer / the firm that you are leaving will fill out and submit a Form U5 to FINRA. This will terminate your employment and your registrations with that firm. When you become employed at new FINRA member, your new firm you must fill out and submit a new Form U4. This will begin your registration with your new firm and your series 6 and 63 licenses will become active at your new firm upon receiving notice from both FINRA and the states where you conduct business. No license to conduct business will become effective until notice has been received that the license has been granted. Passing the exams do not grant a license to conduct business. Only the states and FINRA may grant the license.
Becoming series 6 and 63 licensed will require many people to make an investment in their professional development. Your series 6 license will empower your to conduct a significant amount of business and will put many people on the road to a lucrative and successful career. The series 63 will license you to conduct business in any of the more than 40 states that currently require the license. The good news is for those who have to pay for it out of pocket, the costs are relatively low when compared to other types of training, certification and college expenses. Some employers pick up or reimburse the costs of training and the testing and registration fees. Even for these people many obtain additional resources such as additional test questions, books or videos to ensure they pass their exam. For those who have to pay all of the expenses out of pocket, it usually only costs a few hundred dollars for the testing and registration fees and the training materials.
Once you have become fully licensed by passing the series 6 and 63 exams you will be required to meet FINRA’s continuing educational requirements for the series 6. There are two parts to these continuing education requirements. Every year your firm will have you attend a seminar, webinar or take an online course to satisfy the firm element continuing education requirement. You will also be required to complete the regulatory continuing education requirement which is administered by FINRA. A series 6 license requires the licensed professional to meet this continuing education requirement by successfully completing the S106 course. Your requirement will be based on your date of association with a FINRA member. Your date of association for most people will be the date you passed your exam. You will be required to complete the S106 on the second anniversary of passing your series 6 exam and every three years thereafter. The S106 course may be completed at an approved facility or on FINRA’s continuing education portal. Your series 63 license does not have any continuing education requirements at this time.
Once you have become series 6 and series 63 licensed You will be fully licensed to conduct business in open end investment company products. Should you wish to do business in variable annuity products or variable life contracts you must also obtain the life and health insurance license detailed above.
We hope that this answers many of your frequently asked questions about the series 6 and 63 licenses. If you have any additional questions please call or email us.
Good luck on your exam.
The Securities Institute of America, Inc.