Follow Us
You may have heard the terms “financial advisor” and “broker” used interchangeably when it comes to financial planning. But, there are some key differences between the two.
A financial advisor is a professional who works on a fee-based model of pay. They provide financial information and give advice that is catered to individuals. Additionally, financial advisors often manage their clients’ investment portfolios, give financial retirement advice, and help their clients meet their goals. Financial advisors also deal with estate planning, wealth management, tax planning, and other finance-related topics. Financial advisors are not necessarily registered with the Security and Exchange Commission (SEC).
A broker is an individual or firm that acts as an intermediary between an investor and a securities exchange. Brokers act as a service between securities exchanges and investors. Security exchanges only accept orders from firms that are members of that exchange, letting the broker provide that service in exchange for compensation through fees, the exchange, or commissions.
Brokers can provide their investors with research whether that’s through investment plans or their own market research. Brokers may sell financial products that their firm offers to their clients. Additionally, they provide tailored solutions to those who have a high net worth. Historically, only the wealthy could afford a broker and make dealings through the stock market.
The difference between a financial advisor and a broker comes down to the services that they provide their clients and how they are paid. Financial advisors tend to work on fee-based payments while brokers are usually paid through commissions or selling products. A broker is licensed by FINRA and works to buy or sell securities.
Financial advisors have no legal requirements to call themselves that title, which is why we recommend to seek out a fiduciary advisor if looking for financial advice. Financial advisors do work with clients in the long-term, setting goals such as retirement, estate, and tax planning.
Generally, you will seek out financial advisor services if you are looking for long-term planning opportunities. Brokers act solely as investment middlemen and won’t help with general financial planning. If you are seeking out a fiduciary financial advisor, contact Senior Finance Advisor today.
Related Articles
How to Find a Fiduciary Advisor
With our trusted network of advisors, we’ll connect you with up to three established planners in your area.
With our trusted network of advisors, we’ll connect you with up to three established planners in your area.
The most reputable financial advisors for seniors are the ones who are not only knowledgeable and qualified about retirement planning and after-retirement financial strategizing, but also the ones you can trust. Learn 5 things to consider to help you find a financial advisor right for you.
Read MoreInvestment Management
Learn 7 steps to help you find the best financial advisor for you. From understanding the different financial service offerings to verifying credentials and understanding the compensation; learn how to find a financial advisor you can trust with your money.
Read MoreResources
Many Americans have wondered whether their financial advisor is a fiduciary as the investment world is plagued with conflicts of interest, obscure disclosure and an overall lack of transparency. A financial advisor who will act as your fiduciary can help eliminate many problems. Learn more.
Read MoreInvestment Management
Helpful Retirement Reads
Most Reputable Financial Advisors for Seniors How to Find the Best Financial Advisor Top 11 Questions to Ask a Financial Advisor Before Hiring What Are the Best Investments for Retirement? Do You Know About the Spousal Social Security Benefit? What are Discretionary and Non-Discretionary Spending? Is Your Financial Advisor a Fiduciary?Follow Us
Find an advisor nearby
© 2024 Senior Finance Advisor Inc. All rights reserved.
