3 Types of Financial Advisors and How to Pick One

26 Nov 2019
Managing your finances can be hard, but you don’t have to do it alone. Here are 3 types of financial advisors and how to pick the one for your needs.

Did you know that a mere one out of four Americans feels prepared for retirement? And almost 80% of people feel the best savings strategies aren’t accessible to them.

There are many challenges when it comes to saving for retirement. Don’t let confusion about the types of financial advisors be one of them. 

Managing your finances is difficult but there’s lots of help available. Here are three types of financial advisors and how to pick the best one for you. 

1. Computer Robot Advisor

Computer robot advisors, called Robo-advisors, are online digital services. They offer low-cost management for your investments. 

After answering a series of questions, a computer algorithm builds a custom investment portfolio. The algorithm bases your portfolio based on your risk tolerance and goals. 

The Robo-advisor monitors your portfolio and rebalances your investments on a regular basis. Robo-advisors are a good first step in financial planning. 

2. Virtual Financial Planning Services

Are you ready for a step up from the Robo-advisor? Virtual financial planning services offer online access to personal financial advisors. These services are like Robo-advisors but more comprehensive. 

With an online service, an individual financial planner answers your questions. She’ll also guide you in creating a comprehensive financial plan.

You don’t understand portfolio diversification? Don’t worry, your advisor helps by creating a plan that works for your retirement goals. 

3. Traditional Financial Planning Services

There are many specialists under the broad umbrella of financial planning services. 


A broker or stockbroker buys financial products for you for a fee. Sometimes stockbrokers work on commission and sometimes they get a fee plus a commission. 

Make sure your stockbroker is on the registry with the United States Securities and Exchange Commission. 


A CFP is a Certified Financial Planner. If your advisor has CFP after his name, he went to school, passed a difficult set of exams, and has work experience. 


A Registered Investment Advisor takes a fee for providing financial advice and recommendations. An RIA is also registered, either with a state regulator or the U.S. Securities and Exchange Commission, depending on the company’s size. 

Wealth Managers

Wealth managers work with affluent clients. They require a minimum amount of money deposited into an account. The smallest amount required for an account is usually $1 million or more. 

No matter who you choose, always read the fine print on any agreements you sign and always check the advisor’s credentials

Choosing Between Different Types of Financial Advisors

There are many types of financial advisors. Choose the advisor that works best for your needs.

If you’re starting out and don’t have a lot of money, try a Robo-advisor. You’ll get a low-cost, streamlined system. Opening one of these accounts doesn’t mean coughing up thousands of dollars. 

Is your financial situation a little more complicated? Do you need more advice when it comes to insurance and estate planning? Try an online or virtual service. 

Are you uncomfortable with online services? Consider a more traditional financial planning service. 

Whatever you choose, it’s crucial to start saving for retirement as early as possible. Don’t let investment fears keep you from earning more on your money today!

Are you in need of financial planning services? Please contact us today!


Daryl Seaton