There are many different types of advisors with different titles and qualifications. Some may have more than one title. Below we’ve highlighted some of the top ones you might encounter.
As with a financial consultant, this is a title that just about anyone can claim. A financial planner helps you create a roadmap to meet your goals. And they can recommend how much to set aside, suggest how much to invest and what types of investments might work well.
If you want to work with someone who has met certain educational requirements and adheres to certain ethics, work with a Certified Financial Planner™ (CFP®). These professionals must pass a CFP Board exam and have to keep up with ongoing education to remain certified.
The Securities and Exchange Commission (SEC) defines an “investment advisor” as someone who provides investment advice in exchange for some kind of compensation. In most cases though, an investment advisor uses a different title. Whatever the title, an investment advisor can give you advice and even manage your portfolio. Look for someone who is a Registered Investment Advisor (RIA). And choose someone who is registered through BrokerCheck, a service run by the Financial Industry Regulatory Authority (FINRA).
An investment broker is someone who can buy and sell different securities on your behalf. Many investment advisors work for brokerage firms and can manage your portfolio. In order to buy and sell securities, a representative of a firm must pass certain exams. These include a Series 6 and a Series 7 exam. Use BrokerCheck to make sure your broker has passed those exams.
Robo advisors also fall into the category of broker or investment advisor, and most of them are RIAs and can invest on your behalf. Betterment is an excellent choice and one of our top recommended robo advisors.
An accountant gives advice about business organization and planning. A good accountant can help you prepare your taxes, make the right tax moves for the coming year, and decide which business organization will be of the best use to you.
CPAs have extra credentials and must pass an exam. They are usually certified through the state. So check to see if their registration is up to date in the state where you reside.
This is a title that just about anyone can use. A financial consultant looks at your finances and helps you make a number of decisions about your money. This includes saving and investing. But financial consultants don’t need to meet particular requirements.
However, if you can find a Chartered Financial Consultant (ChFC), you know they have met certain requirements set forth by The American College of Financial Services. This designation carries with it the assumption of education and ethics — as well as a fiduciary duty. A fiduciary duty means they have a legal obligation to put your needs above their own. When it comes to someone helping you with your hard-earned money, that’s important.
If you feel like you need help with the basics of financial literacy or you need help with your mindset, a financial coach could help. There are no special requirements to become a financial coach. So, practically anyone can call themselves a coach. But there are different organizations that have their own certifications for coaches. You need to decide whether you trust the certification and the organization if you decide to use a financial coach.
Wealth Managers and Portfolio Managers
If you want someone to actually manage your assets, look for a manager of some sort.
- A wealth manager takes a holistic approach to managing everything you have and helping you grow your wealth for the future.
- A portfolio manager often just sticks with managing a specific investment portfolio. If you’re relying on someone to manage investments for you, double-check that they’re registered with BrokerCheck.