Financial advisor meeting with clients.

What Is A Financial Advisor?

Carey Chesney8-minute read
February 21, 2022

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Looking to maximize the money you earn and reduce the risk of losing it? Well, that’s exactly what a good financial advisor can do for you. There are many types of financial advisors who offer a plethora of services, but to put it simply, they work with you toward achieving your financial goals. That means different things for different people, of course, so understanding your specific financial needs as well as the various services financial advisors offer can help you make an informed decision about hiring one.

What Does A Financial Advisor Do?

A financial advisor helps you manage your finances with both a short- and long-term view. Think of them as a coach who provides a game plan for how to reach your definition of financial success while at the same time giving you “in-game” coaching on major financial decisions. Whether it’s buying a house, deciding when to retire, saving for college, or deciding the best stocks to invest in, your financial advisor should be there every step of the way for your most important financial life decisions.

What Services Do Financial Advisors Offer?

Financial advisors are armed with skills and strategies that range across a variety of financial factors that affect your ability to meet the goals they set with you. Here’s an in depth look at some key services they offer:

Debt Management

Most of us know less debt is a good recipe for financial success, but a financial advisor can help explain the specific benefits of paying off debt that are unique to your situation. More importantly, they can arm you with the tools and strategies to pay off that debt, setting the foundation for reaching your financial goals.


Creating a personal budget can sit at the bottom of your to-do list because frankly, it’s not the most fun thing to do. A financial advisor can ask the right questions and take you through a step-by-step budgeting process that moves you toward the things you want, such as buying a home, saving for college, or securing your retirement.

Health And Long-Term Care Planning

No matter how well we plan for the future, unforeseen expenses can occur later in life. Whether it’s health care costs, assisted living needs, or financial costs associated with caring for a loved one, a financial advisor can help you prepare for events like these.

Estate Planning

Making sure your assets are protected and divided according to your wishes after you pass is an important part of financial planning. A financial advisor can lead you through this process to ensure your family is taken care of in the future.


Managing debt, building wealth and planning for current and future expenses are just a few of the ways a financial advisor can help you ensure your financial security for retirement. It’s never too early to start thinking about this, and the sooner you start, the more likely it is you’ll be able to achieve your retirement goals.


Inheriting money when a loved one passes can be a complicated process, especially when considering tax implications. A financial advisor can help you navigate this process to protect your inheritance and build your newfound wealth.

Tax Planning

Let’s be honest, filling out your taxes is an annual ritual most people dread, and wondering if you are paying too much or getting back too little is at the heart of that anxiety. A financial advisor can put you at ease by helping you come up with a plan for how you will file your taxes to get the most bang for your hard-earned buck.


Investing your money to help it grow toward securing your financial future is an important part of long-term financial planning, but it’s often tough to know where and when to invest. A financial advisor can help you wade through the litany of options and make the best plans when it comes to investing and growing your wealth. They have a ton of strategies for saving and investing toward your financial success, so be sure to leverage their expertise as much as you can.

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Types Of Financial Advisors

Like many professions, financial advising refers to a variety of people with varied areas of expertise who offer many different types of services. Choosing the right type of financial advisor who will meet your specific needs is critical to ensure you get the right kind of help you need. Here is a look at a few of the different types of financial advisors so you can think about which one makes sense for you. 


This term refers to digital services that offer low-cost investment management with minimal interaction with an actual person. They offer the benefit of being able to invest and manage a very small of funds, but are usually lacking when it comes to the broader wrap-around services, like short- and long-term financial planning.

Online Financial Planning Services

These services include many of the features robo-advisors offer and build on them by including the chance to consult with financial advisors as questions arise. This brings you closer to working with an in-person advisor, but through an online interface. They also differ from robo-advisors in that they often have minimum investment requirements that can be relatively high. These services are typically less expensive than working with an in-person advisor, but are more expensive than robo-advisors.

Traditional, In-Person Advisors

If you prefer a more hands-on, personal approach, an in-person advisor might be the right fit for you. This is the more traditional form of financial advising and includes a wide variety of services that help you handle various aspects of your finances beyond just investment accounts. In-person advisors are especially good for people with complex financial situations – investment accounts, a large net worth, complicated estate and retirement planning goals, etc. – as these require the thoughtful analysis of an experienced professional. That said, you can still hire a traditional, in-person advisor even if your financial situation is not very complicated. If you decide to go the in-person route, there are a variety of professionals uniquely qualified to provide the specific financial advising services you need. Below are a few of the specific job types and their definitions. Keep in mind that the same person can hold more than one of these titles: for example, a CFP may also be a stockbroker.

  • Financial Advisor - A general term for a professional who provides financial guidance to clients.
  • Financial Consultant - A person who offers financial advice regarding a particular issue or goal.
  • Certified Financial Planner - An advisor who has completed education requirements and passed a test to become certified. They provide financial planning advice to clients.
  • Broker/Stockbroker - A person who purchases and sells financial products (stocks) on behalf of clients in exchange for a fee, commission or both. They must pass exams and register with the U.S. Securities and Exchange Commission in order to work.
  • Registered investment advisor - A person who provides investment advice and makes recommendations. They’re registered with the U.S. Securities and Exchange Commission or a state regulator. Some work with investment portfolios, while others focus on general financial planning.
  • Wealth Manager - A person typically employed by those with a high net worth, these advisors assist customers with wealth management.

How To Choose A Financial Advisor

The first step is to consider what types of services will fit your needs. Think about what keeps you up at night worrying or, better yet, what brings you joy when thinking about your future. Are you concerned about having enough money for retirement? Are you excited about the possibility of buying a new home? Questions like this will help you hone in on the right financial advisor for your specific goals and aspirations. Some might be better suited to help you manage a large amount of wealth. Others may have more expertise in helping you understand things you need to know about your credit.

Credit, in particular, can often bring up a lot of questions financial advisors can help with: How do different actions affect my credit score? How do I build my credit up? How do I remove errors from my credit report? How does applying for a loan affect my credit score? This list goes on and on.

The questions you face and the needs you have are unique to you. The skills of each financial advisor are unique to them. It’s all about finding the right match. Once you’ve determined the type of advice you need, think about how much you want to spend on these types of services. If your budget is lean and your needs are minimal, a robo-advisor might be your best bet. If you want to invest more in these types of services and have a variety of needs, traditional in-person advisors might be a better type to consider.

Also, be sure to investigate the specific person or service you’re considering. What are their qualifications? What do other customers say about them? What track record of positive results can they show you? Be picky during this process – it’s your money and your financial future that’s at stake.

Why Do You Need A Financial Advisor?

Handling your personal finances – both now and for the future – can be a complicated and daunting process. With so many financial tools at your disposal, regulations to abide by, tax implications to consider and much more, having an expert help you can go a long way in easing concerns and ensure you are maximizing your wealth. Financial advisors are trained in the laws, processes and various strategies involved. Because of this, the investment in them is usually well worth the returns.

Get approved to buy a home.

Rocket Mortgage® lets you get to house hunting sooner.

Financial Advisor FAQs

Let’s take a look at some of the most common questions people have when it comes to financial advisors.  

1.  How Much Does A Financial Advisor Cost?

Price varies based on the services you are looking for and can be in the form of a flat fee, an hourly fee, a per-plan fee or a commission-based structure. A comprehensive financial plan can be in the thousands and ongoing support can include a monthly retainer in the hundreds. This can be significantly more or less depending on the amount of work, the experience and credentials of the financial planner, and a number of other factors.  

2.  What Are The Benefits Of A Financial Advisor?

We’ve covered more than a few of the benefits already, including how a financial advisor helps you manage your money and plan for your financial future. In addition, one of the most important benefits a financial advisor can offer is giving you an unbiased opinion on your financial situation, particularly investments, and help you make the best choices.

3.  When Should You Hire A Financial Advisor?

A financial advisor can help you no matter what stage of life you’re in. Some of the services that benefit younger people include planning for large purchases like a down payment for a home, establishing good credit, dealing with debt or taking a long view into the future by planning for retirement. In the example of buying a home, there are a slew of financial factors at play beyond just your down payment including moving costs, tax implications, the use of seller concessions and so much more. Having an expert financial advisor work with you through this process can be invaluable.

For older adults, financial planners often focus on budgeting current finances to ensure financial independence and planning for distributing your wealth after you’ve passed away. At every stage of life, working with a financial advisor can give you the peace of mind that you’re making the financially sound decisions necessary to protect your future and that of your loved ones.

Regardless of your level of wealth, plans for the future, age or circumstance, thinking about your financial strategy to help you achieve your life goals is always a good idea. A financial advisor can help distill your specific needs into an action plan that can get you on the path to growing and maintaining your wealth now and into the future. Now that you’re armed with the knowledge of how to find a good one, go out there are start interviewing until you find the one who’s right for you!

Carey Chesney

Carey Chesney brings a wealth of residential and commercial real estate experience to readers as a Realtor® and as a former Marketing Executive in the fields of Health Care, Finance and Wellness. Carey is based in Ann Arbor and attended the University of Wisconsin-Madison, where he majored in English, and Eastern Michigan University, where he recieved his Masters in Integrated Marketing & Communications.