Choosing Between a Financial Advisor and an Investment Consultant

Before choosing a financial advisor, you must be aware of some of the differences between these two professions. Among them are their certifications, fees, and personality. However, you should be sure to consider your own needs when deciding which professional to hire. The following are some tips to help you make the right choice. A financial planner may have limited expertise in non-security investments, while an investment consultant may focus on more traditional security investments. In addition, financial planners may only be able to recommend a specific range of products, while investment consultants might have a wider scope of options and expertise.

Fiduciary duty

Browse next article.  A fiduciary is someone who acts in a client’s best interest. A financial advisor or investment consultant with this role must not use their client’s assets for personal gain. These individuals may be a banker or financial advisor, or a trustee, board member, or executor. The duty of care extends beyond the financial world. The SEC has a database of RIAs.

Certifications

Financial advisors can earn a variety of professional designations. Typically, these require extensive study, many years of experience, and a substantial financial investment. The process of earning these credentials can strengthen an advisor’s expertise and marketability. Certifications also require ongoing education, which helps credentialed advisors keep up to date on industry trends and practices. Additionally, advisors are held to rigorous ethical standards, which can help clients feel more comfortable with their financial adviser.

Fees

There are pros and cons to each, and the choice is really a matter of personal preference. One type of financial advisor works with clients on a flat fee, while the other works for a percentage of the total assets managed. An hourly fee can vary anywhere from $150 to $400 per hour, and the price doesn’t change based on the size of the portfolio. An hourly fee may require an up-front retainer, but the benefit of an hourly service is that it is not tied to investments.

Personality

The personality of a financial advisor is not entirely unlike that of a general population. The two are both conventional and timeless, and both are susceptible to being driven away by compliance requirements. However, there are some notable differences between these two occupations. Personality tests have shown that men are generally more conscientious than women, and vice versa. These differences can have significant implications for the types of financial services offered by both professions.

Criminal record

There is a difference between an investment consultant and a financial advisor when it comes to their criminal record. While stealing from former clients may be considered a major offense, there are a lot of smaller crimes that you should keep in mind. Check this out. The average age of an investment consultant is over 50 years old. A person who has been charged with a crime can be convicted of a misdemeanor or a felony.