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What Does a Financial Advisor Do For You?


A financial advisor is a broad term that covers a lot of people and types of work. Financial advisors are people who can offer individuals guidance on their finances, or in some instances, handle their finances for them. A financial advisor might handle your investments, or they might simply offer you information on different types of estate plans.

Before you hire anyone to be your financial advisor, it’s crucial that you understand exactly what you really need done in your finances. From there, you can find our what a financial advisor can do for you, and determine if they fit into your money plan.

What A Financial Advisor Does

What a financial advisor does for you is a tricky question to answer simply because there are a plethora of financial advisors out there. A financial advisor is a catch all phrase for everyone from an investment manager to a Certified Financial Planner, to even a robo advisor.

What these people can do for you depends on which type of financial advisor you talk to. That’s why it’s important to be in touch with your finances before seeking someone else out. Having a baseline understanding of what is going on with your money will help you see the areas where you’d like help and where you wouldn’t.

Speaking broadly, a financial advisor will review all your finances, like your assets and investments, your debts, your income, and your monthly expenses. From there, they’ll make a plan for you depending on your financial goals.

An investment manager will be more attuned to giving you investment guidance, and may even handle your investments themselves. You’ll give them permission to buy and sell investments on your behalf.

A CFP may offer a broader financial plan, where they help you to figure out a debt pay off plan as well as an investment plan, and help you draw up an estate plan for your money.

To an extent, you can choose which services you want based on the type of advisor you select. I most cases, a credentialed, in person financial advisor will charge an ongoing hourly fee (or perhaps a percentage fee based on your portfolio), and provide ongoing advice and money management services.

A robo-advisor, as an automated portfolio manager, is a lower cost financial advisor. An algorithm will determine things like your investment risk tolerance and how much money you should have in an emergency fund.

What to Do Before You Meet With a Financial Advisor

Before meeting with a financial advisor, sit down and review your finances.

  • Organize all paperwork related to your assets. This can include any investment accounts, trust funds, property you own, or cash on hand. It might also include things like valuable pieces of jewelry or art.
  • Create a list of all your debts. Everything from student loans, mortgages, personal loans, medical, auto and credit card debt should be included.
  • Sketch out a five and ten year plan for yourself and your finances. What is it that you’re interested in doing with your money? What direction do you want your life to go in? Putting your goals, hopes, and ideas onto paper will help guide your conversation with any financial advisor.

Say for example that you want to have children in the next two years. You may want to begin saving for their college expenses right away- a financial advisor can help you determine what type of accounts are best for that and how to start funding them.

Taking the time to organize your finances and outline your hopes for your future puts you in the best position to meet with a financial advisor. If you meet with someone without understanding what kind of position you’re already in, you could waste time on financial topics that don’t matter to you. In a worst case scenario you could be taken advantage of.

What to Consider in a Financial Advisor

Since not all financial advisors are created equal, and not all of them can do the same thing for you, let’s talk about what to consider in a financial advisor.

The first thing to consider is that this is a person that you’ll be working with for years on a very intimate part of your life. You’ll want a financial advisor that you trust and that you can be around.

If someone interrupts you a lot and you find it very annoying, it’s probably not a good fit. Regardless of what their credentials might be, if you can’t stand them, they are not going to serve you in the best possible way.

The second thing to consider are those credentials. Are they certified? Are they licensed? Where did they get their financial education? Make sure to do your research on any financial advisor. Anyone handling your money should be someone you vet thoroughly.

Finally, consider the logistics of working with a financial advisor at this point in your life. Ask yourself questions like these:

  • Do they offer online or phone consultations, or only in person? And which do you prefer?
  • Do you plan on remaining in this area for the long term? If not, is there a branch of this advisors office in the area you plan to move to?
  • Does this advisor have the capacity to handle major changes in your money? For example, if you receive a large inheritance, or if you have triplets, will they be able to advise these drastic changes to your finances?

Final Thoughts

A financial advisor is someone who is able to help guide you through financial decisions and provide financial assessments over the course of months or years. If you decide you’d like a financial advisor, do your homework.

Get clear on your own finances and what you’d like to do with your money. From there, research the different types of financial advisors available to you. Then find one that you like and trust to provide sound financial guidance.

Your money is a huge part of your life, and you want to make the best decisions for yourself today, and your future self.

About the author

Kara Perez

Kara Perez

Kara Perez is the founder of Bravely Go, a feminist financial education company. Bravely focuses on bringing actionable and accessible financial education to people via pop up events and online community. Read more

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