Unsure Whether You Need a Stockbroker, Investment Advisor, or Financial Planner?

Best san francisco investment advisor

If you’ve been paying attention to the financial markets recently, you know that there is no better time to start planning for your future with smart investments. As Reuters writes, the Standard and Poor’s 500 index sits at record highs, and the Dow Jones industrial average maintains a healthy score at 16,434. In other words, the markets are back in good health, waiting for people like you to make your move and improve your financial security.

Of course, knowing that it’s time to strike and knowing how are two very different things. That’s why finding an investment advisor representative is increasingly important for all Americans looking toward the future. However, finding an investment advisor is often easier than done, if only because so many of us confuse terms and have no idea what we’re actually looking for. Some think that they need a stockbroker, others an investment advisor, and others still are left looking to find a financial planner. The problem? They’re not all the same, and they don’t all have the same knowledge or set of skills to help you succeed.

What Are the Differences Between Stockbrokers, Investment Advisors, and Financial Planners?

  • Stockbrokers
  • As written on Investopedia, stockbrokers are federally regulated financial professionals who work exclusively for retailers and clients at institutions. They take a cut out of each transaction. Unless you represent a larger organization, a stockbroker isn’t likely to offer what you’re looking for.

  • Investment Advisors
  • Investment advisors work with individual clients, aiming to advise them on the feasibility of investing in certain securities. Whereas stockbrokers are paid by taking a set percentage from each transaction, investment advisors work on hourly or set fees, or on a percentage of your managed assets. Some also work at set rates. Investment advisors go by many names, including wealth managers, asset managers, and investment managers, but all of these titles mean the same thing.

  • Financial Planners
  • As the name implies, financial planners work to offer clients a plan for reaching their financial goals. According to the U.S. Securities and Exchange Commission, this includes everything from managing taxes to insurance to retirement and estate planning. Of all the categories, answering “what is a financial planner” is the most vague because they’re known to do so many different things.

One Rule You Need to Keep in Mind for All Investment Professionals
Regardless of whether you need a stockbroker, investment advisor, or financial planner, there is one thing you need to be sure of before hiring them: credentials. As U.S. News and Money Report astutely suggests, each type of financial professional needs to have the proper credentials. Stockbrokers, for example, need to be registered with both the SEC and FINRA, have passed qualifying exams, and be working on the behalf of a brokerage firm.

Finding a professional advisor while the markets continue to rebound can be one of the best decisions you’ll ever make. Now that you know what to look for and what each title means, you can improve your chances of having a successful search. Reference links: San francisco investment advisor

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