Knowing how to choose the right person to manage your money can be a complex process.
Plenty of Americans want financial help, but only about one third use a financial adviser, according to Statista. So what gives? As many as three in five say they simply aren’t sure where to look, according to a report from financial technology company IntelliFlo.
While financial advisers are equipped to help build a comprehensive fiscal plan, one of the first steps you may want to take before meeting with your new prospective money management professional is deciding what you, personally, hope to accomplish from this relationship. Establishing what you want to one day accomplish, as well as meeting your day-to-day financial needs, are just some of the factors to consider.
Here are some of the most common reasons to hire a financial adviser: Looking for a new financial adviser? This tool can match you to an adviser who meets your needs. Here are just some of the most common credentials financial advisers tack to their email signatures and Linkedin profiles to show their various qualifications:
A good resource to find background information on the brokers, brokerage firms, investment adviser firms and advisers you’re considering is a free tool from FINRA known as BrokerCheck. Just type in their name or name of the firm for a detailed history of their credentials, work history timeline and even possible violations.
4. What services can I expect an adviser to perform? What tasks or financial planning services can you expect from your financial adviser? Typically, a financial adviser specializes in providing investment management services, planning help for your financial future, and all things related to wealth management.
Investment adviser These advisers typically specialize in securities and provide clients with data analysis to pick and manage their investments. They also typically charge a fee to work with you and have a fiduciary responsibility to put your financial needs first. Investment advisers are also registered with the Securities and Exchange Commission if they manage more than $100 million in combined client assets.
Asset manager These financial professionals specialize in the day-to-day management of their clients investment portfolios, help clients acquire additional assets and maintain trade investments for their clients. Asset managers can either work for an investment bank, as a private contractor or with a number of financial institutions.
Financial coach Unlike a certified financial adviser or other credentialed financial professional, financial coaches are not required to receive any certifications to provide their services. If you see someone with this title, they often will charge hourly rates for helping you work towards a specific financial goal. These types of goals can usually include cutting back on spending, budgeting and saving.
Because they are typically less costly than working with a human adviser, they also charge lower fees and often come with lower investment requirements to get started. They can be used to manage your retirement accounts and even help build a comprehensive investment portfolio.
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