What You Should Know About CPAs This Year

How to Find the Right Investment Advisor for You

So you’ve decided you want to hire an investment advisor, but you still don’t know which particular type is suitable for you. Now all that’s left is the challenging part – looking for an advisor who is both knowledgeable and sincere in keeping your best interests at heart. But again, financial advisors come in a variety of types. How do you tell which of them suits you best? You can start by considering the volume and kinds of services you need.


If you only seek investment guidance or basic financial advice, you can work with a brokerage firm, which normally only collects commissions. But remember that brokers only need to uphold what is referred to as a suitability standard of care, which means that they are only allowed to suggest or sell investment types that match the client’s current financial status and financial goals. This does not cover a legal requirement to recommend the best or most cost-efficient types of investments. This all the more makes it important to spend time researching the background of potential advisors.

Certified Financial Planners (CFP)

Certified Financial Planners (CFP) are finance professionals who have satisfied all of the Certified Financial Planner Board of Standards’ requirements, including a minimum of experience and passing a board exam. Additionally, CFPs have to take ongoing courses to maintain status. CFPs are knowledgeable in various areas of financial planning, such as retirement, taxes, insurance, and the like.

Registered Investment Advisor (RIA)

If you seek investment advice and long-term financial planning, look for a Registered Investment Adviser. These professionals are only paid by the client – you – and they only recommend investments (for instance, no-load mutual funds, ETFs, etc.) that best meet your needs.

They are also required to follow a fiduciary standard of care, which is more complex than the suitability standard of a broker. In short, an RIA is legally required to promote and protect the interests of the client. Expectedly, you will be paying ongoing fees, and with a good RIA, you will be able to save on expenses through low-cost mutual funds, which are generally the best-performing funds.

Insurance Agents and Bankers

Even as insurance agents and bankers are not financial planners nor investment advisors, they are legally permitted to sell investment products like mutual funds, stocks, bonds, etc. As well, they may function as financial planning consultants.

Finally, whomever you decide to hire as an advisor or planner, it is best to pick one with certification. You should also ask friends or co-workers for referrals or at least read client reviews online before making your final decision.

On Accountants: My Experience Explained

News For This Month: Professionals

This entry was posted in Travel. Bookmark the permalink.