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Best Financial Advisors in Colorado 2020: Fees and Services

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone and is not intended to be a source of investment advice. It may not have not been reviewed, commissioned or otherwise endorsed by any of our network partners or the Investment company.

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Choosing a financial advisor can be challenging, given the number of financial advisors in Colorado. Finding the right advisor for you has a lot to do with figuring out the proper fit, which means understanding your financial needs and goals and how much you’re willing to spend.

That being said, we understand comparing firms and data points can be difficult, so we compiled the most pertinent information to help guide your decision. To determine the best advisors in Colorado, we only considered firms that manage individual accounts and offer financial planning services. We then ranked these firms based on assets under management (AUM), which serves as a general metric for the firm’s size, and client-to-advisor ratio, which indicates how much attention you may get as a client.

Our ranking is not indicative of which firm may be best for you, but it can help make the shopping experience easier. Take a look at our list below for the top firms in Colorado and their key highlights:

financial advisor

10 best financial advisors in Colorado

Methodology and criteria

For our search, we looked at firms across the state of Colorado. All of the firms considered are bound by fiduciary duty, registered with the U.S. Securities and Exchange Commission (SEC) and offer individual account management and financial planning services.

The firms that met this criteria were ranked based on their AUM and client-to-advisor ratio. These criteria are weighted equally in our scoring metrics. Firms with a higher AUM and lower client-to-advisor ratios garner higher scores. Our ranking system is designed to help compare firms, but does not indicate which firm may be best for you.

In our reviews, we’ve listed several other key features that will help you determine which financial advisor is most fitting for your investing style and financial needs. It is important to note that we did not include disciplinary disclosures as a metric for our ranking. We have listed any disciplinary disclosures current as of September 17, 2020, but urge you to evaluate these firms on https://adviserinfo.sec.gov/.

1. Advised Assets Group, LLC

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  • City: Greenwood Village, Colorado
  • Individual investor to advisor ratio: 98:1
  • AUM: $48,524,968,952
  • Minimum assets required: Not listed
  • Fee structure: 
    • A percentage of AUM
    • Fixed fees

About Advised Assets Group, LLC

Founded in 2000, Advised Assets Group, LLC provides investment management and advisory services to retirement plan sponsors, plan participants and IRA account holders nationwide. Its services include asset allocation using mutual funds and exchange-traded funds (ETFs), managed portfolios from third-party investment managers and financial planning. The firm offers services on both a discretionary basis, in which it makes the decisions about buying and selling assets, and on a non-discretionary basis, in which the client makes the final decisions.

In addition to its Greenwood Village, Colo., headquarters, Advised Assets has an additional 14 offices located throughout the country. The firm is registered to serve clients in all 50 states, as well in the District of Columbia, the Virgin Islands, Guam and Puerto Rico. It is a subsidiary of Great-West Life & Annuity Insurance Company, which is also based out of Colorado.

Advised Assets Group, LLC investing strategy

Advised Assets Group focuses on achieving long-term returns, as opposed to attempting to predict the future performance of specific securities. It takes a similar stance on attempting to predict clients’ future income and expenses, instead choosing to focus on their current lifestyle.

With an emphasis on retirement planning, the firm’s recommendations are based on factors including the client’s account balance, expected retirement age and contribution rate, among others. Its stated goal is to “make retirement planning smarter and more accessible than ever before.”

Advised Assets Group, LLC disciplinary disclosures

Advised Assets Group, LLC has one disclosure on its record, related to an incident in which the Maryland Department of Insurance determined it needed to revise its buyers guide and policy summary to comply with state law; the firm has since done so, and a $6,000 fine was paid.

All registered investment advisors are required by the Securities and Exchange Commission (SEC) to disclose any disciplinary events — including civil, criminal and regulatory actions — on the Uniform Application for Investment Advisor Registration, commonly referred to as Form ADV. For more information, including access to the Form ADV, visit the firm’s IAPD page.

2. Mercer Global Advisors Inc.

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  • City: Denver, Colorado
  • Individual investor to advisor ratio: 38:1
  • AUM: $15,848,965,584
  • Minimum assets required: $500,000
  • Fee structure: 
    • A percentage of AUM
    • Fixed fees

About Mercer Global Advisors Inc.

Mercer Global Advisors was founded in 1985 by attorney Kendrick Mercer. Today, the firm has 50 offices across the United States. Its team of over 400 employees includes certified financial planners (CFP), certified public accountants (CPA), chartered financial analysts (CFA) and attorneys.

The firm provides comprehensive services, including investment management, family office services and financial planning, including tax planning and estate planning. Mercer Global Advisors caters primarily to high net worth individuals, and clients typically must have a minimum of $500,000 in assets.

Mercer Global Advisors Inc. investing strategy

Mercer Global Advisors strives to maintain consistency while optimizing returns, with a focus on preserving capital and maximizing tax efficiency. The firm believes in broad, global diversification within assets and across asset classes, and it also uses alternative investments that may not perform in line with stocks or bonds.

Instead of a single advisor making investment decisions, Mercer Advisors has an investment committee made up of 16 members that oversee the firm’s policies, portfolios and managers. The firm has also signed the United Nations’ Principles Responsible Investment (PRI), which means it takes into account environmental, social and governance (ESG) factors when making investment recommendations.

Mercer Global Advisors Inc. disciplinary disclosures

There are no disciplinary events disclosed on Mercer Advisors’ Form ADV. Disciplinary disclosures include any civil, regulatory or criminal events against the firm, its employees or its affiliates. For more information, visit the firm’s IAPD page.

3. Crestone Asset Management, LLC

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  • City: Boulder, Colorado
  • Individual investor to advisor ratio: 5:1
  • AUM: $2,949,776,621
  • Minimum assets required: $25 million
  • Fee structure: 
    • A percentage of AUM
    • Fixed fees
    • Performance-based fees

About Crestone Asset Management, LLC

Crestone Asset Management, LLC was founded in 2001. It is a subsidiary of Crestone Capital, which is owned by The Eric J. Kramer Company, the company’s predecessor. Crestone Asset Management, LLC is only registered in the state of Colorado, and it has just one office location, which is its headquarters in Boulder.

The firm provides full-service wealth management, and it caters to high net worth and ultra-high net worth clients, typically requiring a minimum of $25 million in assets. Crestone also serves some corporations and legal entities.

Crestone Asset Management, LLC investing strategy

Diversification drives the investment strategy at Crestone Asset Management. To create diversified portfolios, the firm studies the long-term behavior of various assets. It uses investments in both traditional and alternative markets, such as private equity, hedge funds and real estate, and eschews traditional “buy and hold” investment models, as it does not believe they optimize potential returns.

When creating portfolios, Crestone works with clients to create an individual investment policy statement and to recommend an asset allocation. It then monitors and regularly rebalances client portfolios in accordance with these recommendations.

Crestone Asset Management LLC disciplinary disclosures

There are no disciplinary events disclosed on Crestone Asset Management LLC’s Form ADV. For reference, disclosures include any civil, criminal or regulatory actions against either the firm or its employees or affiliates. For further information on Crestone Asset Management, visit the firm’s IAPD page.

4. IWP Wealth Management LLC

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  • City: Denver, Colorado
  • Individual investor to advisor ratio: 5:1
  • AUM: $2,031,524,977
  • Minimum Assets Required: No minimum
  • Fee Structure: 
    • A percentage of AUM
    • Fixed fees

About IWP Wealth Management LLC

IWP Wealth Management was founded in 2004 by Charles A. Willhoit, who serves as the firm’s president. While Willhoit is the firm’s primary shareholder, all of its partners have equity. The firm has one office in Denver.

IWP Wealth Management is a small firm with less than 10 advisors and just about 50 clients. It caters primarily to high net worth individuals, providing family office, wealth management and investment management services. Additionally, the firm provides consulting services and access to concierge services for travel and entertainment.

IWP Wealth Management LLC investing strategy

IWP Wealth Management believes in diversification across asset classes as well as investment vehicles. The firm typically recommends portfolios that include a mix of ETFs, mutual funds, equities, options, fixed-income securities and private investments.

The firm states that it is risk-averse and more focused on maintaining wealth than pursuing aggressive returns. IWP Wealth Management also advises its clients to maintain adequate liquidity and access to cash, since markets can be volatile.

IWP Wealth Management LLC disciplinary disclosures

There are no disciplinary events — meaning any civil, regulatory or criminal events involving the firm, its employees or its affiliates — disclosed on IWP Wealth Management LLC’s Form ADV. For more information, see IWP Wealth Management’s IAPD page.

5. Colorado Financial Management LLC

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  • City: Boulder, Colorado
  • Individual investor to advisor ratio: 57:1
  • AUM: $1,576,994,626
  • Minimum assets required: $500,000
  • Fee structure:
    • A percentage of AUM
    • Hourly charges
    • Fixed fees

About Colorado Financial Management, LLC

Colorado Financial Management, LLC registered as an investment advisor firm in March 1999. It is officially registered under the name of Sargent Bickham Lagudis, LLC, but it does business as Colorado Financial Management. The firm is owned by Bradley Bickham, managing partner and chief investment officer, and Christopher Lagudis, Meagan D’Angelo, Luke Daniel and Joshua Miller, all of whom are principals and senior financial advisors at the firm.

In addition to investment advisory services, the firm provides financial planning and consulting services on topics such as estate planning and insurance planning. The firm serves individuals and families, as well as businesses, pension and profit-sharing plants, trusts, banks, estates and charitable organizations.

Colorado Financial Management has its headquarters in Boulder, with additional offices in Denver and Loveland.

Colorado Financial Management LLC investing strategy

Colorado Financial Management LLC uses three primary investment strategies: Long-term purchases, short-term purchases and trading. It also recommends margin and/or options strategies, though less frequently, as they tend to be riskier.

The firm provides both discretionary account management, in which it makes the decisions about buying and selling assets, and non-discretionary account management, in which it provides advice but the client makes the final decisions. Generally, the firm uses fixed income, mutual funds and ETFs in client portfolios, with asset allocations based on each client’s investment objectives.

Colorado Financial Management LLC disciplinary disclosures

There are no disciplinary events disclosed on Colorado Financial Management LLC’s Form ADV. Disciplinary disclosures are defined as any criminal, civil or regulatory events involving the firm or its employees or affiliates. For more information on the firm, visit its IAPD page.

6. GHP Investment Advisors Inc.

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  • City: Denver, Colorado
  • Individual investor to advisor ratio: 61:1
  • AUM: $1,539,415,782
  • Minimum assets required: $500,000
  • Fee structure: 
    • A percentage of AUM
    • Hourly charges
    • Fixed fees
    • Performance-based fees

About GHP Investment Advisors Inc.

GHP Investment Advisors, Inc., began doing business in 1995. The firm’s primary shareholder is its president, Brian Jay Friedman, and it has just one office in Denver.

GHP Investment Advisors provides comprehensive financial planning services and investment account management on a discretionary basis (meaning it makes the final decisions on buying and selling securities) and a non-discretionary basis (where it provides advice but leaves decision making to the client). It serves individuals, high net worth individuals, pension and profit-sharing plans, charitable organizations, corporations, businesses and other pooled investment vehicles, such as hedge funds.

GHP Investment Advisors Inc. investing strategy

GHP Investment Advisors generally creates financial plans for its clients and prepares a long-term financial forecast before advising them on asset management recommendations.

The firm uses its GHPIA Valuation Benchmark to assess whether investments are overvalued or undervalued and high-risk or low-risk. It focuses primarily on long-term purchases, generally buying securities to hold for at least a year. It may also use options writing as an investment strategy, as well as investment in private funds.

GHP Investment Advisors Inc. disciplinary disclosures

GHP Investment Advisors has no disciplinary events to disclose, meaning it has a record free of any criminal, regulatory or civil actions against the firm itself or its employees or affiliates. For more information, visit the firm’s IAPD page.

7. Western Wealth Management, LLC

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  • City: Golden, Colorado
  • Individual investor to advisor ratio: 52:1
  • AUM: $1,496,806,934
  • Minimum assets required: $5,000 to 250,000, depending on the program
  • Fee structure:
    • A percentage of AUM
    • Hourly charges
    • Fixed fees

About Western Wealth Management LLC

Established in 2016, Western Wealth Management, LLC is owned by G.E. Buenning, who founded the firm and currently serves as a managing member. The firm provides comprehensive portfolio management and financial planning services. Its clients include individuals and high net worth individuals, charitable organizations, corporations and other businesses, investment advisors and pension and profit-sharing plans.

While Western Wealth Management is headquartered in Colorado, it has a network of more than 80 advisors across the country, with offices currently in California, Connecticut, Tennessee and Texas. These advisors registered with and supervised and overseen by Western Wealth Management, and Western Wealth Management provides them with financial products, services and support, but most operate independently under different names.

Western Wealth Management LLC investing strategy

After at least one meeting with clients to assess their resources, goals, financial situation and tolerance for risk, Western Wealth Management will propose an investment strategy for the client. Its investing strategies usually take into account current trends, trend reversals, historical data and other factors in order to forecast price directions. Portfolios commonly consist of ETFs, mutual funds and individual stocks.

Investment strategies typically used by the firm include both short-term purchases (securities sold within a year) and long-term purchases (securities held for at least one year), as well as trading, short sales, margin transactions and option writing.

Western Wealth Management LLC disciplinary disclosures

Western Wealth Management LLC discloses on its Form ADV that one of its advisory affiliates was disciplined by a self-regulatory organization or commodities exchange. For more information about the firm, visit its IAPD page.

8. IFAM Capital

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  • City: Fort Collins, Colorado
  • Individual investor to advisor ratio: 93:1
  • AUM: $1,273,726,304
  • Minimum assets required: No minimum
  • Fee structure: 
    • A percentage of AUM
    • Fixed fees

About IFAM Capital

IFAM Capital, formally registered with the SEC as Institutional and Family Asset Management, LLC, was founded in 2014 as the successor to IFM Capital Advisors, LLC. It is part of the Focus Financial Partners, LLC partnership. A public company, Focus LLC is traded on the NASDAQ. The firm has offices in Colorado in Fort Collins and Denver, as well as another office Sioux Falls, S.D.

The firm’s services include financial planning, wealth management and investment advisory services as well as retirement plan consulting services. It serves individuals and high net worth individuals, trusts, estates, charitable organizations, businesses and pension and profit-sharing plans.

IFAM Capital investing strategy

IFAM Capital uses the following methods of analysis to evaluate investment opportunities and make recommendations:

  • Fundamental analysis: Looks at the overall health of a company
  • Technical analysis: Looks at past market data
  • Cyclical analysis: Looks at conditions of both the market and the company over time

The firm also works with investment consulting firm Dimeo Schneider to get further research and recommendations regarding investments.

The primary investments the firm uses in client portfolios are mutual funds, ETFs and separately managed accounts via a third-party manager. Most services are provided on a discretionary basis, meaning IFAM Capital makes decisions about buying and selling assets on the client’s behalf without their express approval each time.

IFAM Capital disciplinary disclosures

IFAM Capital has no disciplinary disclosures, which include any civil, regulatory or criminal events involving the firm, its employees or its affiliates over the past 10 years. You can learn more about the firm on its IAPD page.

9. BSW Wealth Partners

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  • City: Boulder, Colorado
  • Individual investor to advisor ratio: 19:1
  • AUM: $1,237,125,570
  • Minimum assets required: No minimum
  • Fee structure:
    • A percentage of AUM
    • Hourly charges
    • Fixed fees
    • Travel reimbursement

About BSW Wealth Partners

Founded in 1992 by Debi Baydush, who is currently of counsel, BSW Wealth Partners is a public benefit corporation, which means that while it is a for-profit company, it has vowed to do good both in the world and for its stakeholders. The firm is owned by Baydush and eight other individuals, each of whom owns a varying percentage of the business.

The firm has its headquarters in Boulder, but it also has an office in the Denver metro area. It provides investment management and financial advisory services, including tax and estate planning, charitable gift strategies, college planning and retirement planning. There’s no minimum asset requirement to work with BSW Wealth Partners, and its clients include individuals, high net worth individuals, pension and profit-sharing plans, trusts and estates, corporations, plan sponsors, charitable and not-for-profit organizations and other businesses.

BSW Wealth Partners investing strategy

When determining an asset allocation, BSW uses a top-down approach, which looks first at the big picture of the economy, and then at the markets and individual assets. The firm primarily advises one of two strategies:

  • Growth strategies: May include equities, mutual funds, real estate and other assets
  • Fixed-income strategies: Include investments such as bonds, notes and certificates of deposit (CDs)

The firm works primarily on a discretionary basis, though in some cases offers non-discretionary services in which the client makes the final decision on buying and selling assets in their portfolio rather than handing that control over to the firm.

BSW Wealth Partners disciplinary disclosures

There are no disciplinary events disclosed on BSW Wealth’s Form ADV. This means the firm has a clean record, free of any civil, criminal or regulatory actions from the past 10 years. For further information, visit the firm’s IAPD page.

10. Transform Wealth, LLC

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  • City: Greenwood Village, Colorado
  • Individual investor to advisor ratio: 112:1
  • AUM: $1,233,311,844
  • Minimum assets required: $500,000
  • Fee structure:
    • A percentage of AUM
    • Hourly charges
    • Fixed fees
    • Performance-based fees
    • Other (asset on third-party platforms)

About Transform Wealth, LLC

Transform Wealth, LLC, formerly Weatherstone Capital Management, Inc., has been in business since 2011. It was acquired in April 2018 by Carnick & Group, LLC, and its name was changed to Transform Wealth, LLC in November 2019. It is part of Focus Financial Partners, LLC, which is a public company traded on the NASDAQ.

The firm offers investment advisory, financial planning and consultation services. Clients include individuals, pension and profit-sharing plans, trusts, estates, charitable organizations, corporations and businesses.

In addition to its headquarters in Greenwood Village, the firm also has offices in Colorado Springs, Colo., Denver and Houston.

Transform Wealth, LLC investing strategy

Transform Wealth places an emphasis on liquidity, diversification, risk analysis and cash flow when allocating client assets, and its investment strategy recommendations range from conservative to aggressive. In general, the firm takes a long-term perspective, and it states that it doesn’t believe in relying on just one strategy to outperform the market.

Transform Wealth, LLC uses fundamental analysis (an evaluation of the health of companies) and technical analysis (an evaluation of the health of the market) to make investment recommendations. Investments commonly used in client portfolios include individual equity securities, ETFs, mutual funds and other securities, though it also may offer advice on other types of investments.

Transform Wealth, LLC disciplinary disclosures

There are no disciplinary events disclosed on Transform Wealth’s Form ADV. For reference, disclosures include any civil, regulatory or criminal events against the firm, its employees or its affiliates. For more information, visit Transform Wealth’s IAPD page.

Financial advisors in Colorado: FAQs

The state of Colorado doesn’t collect any estate or inheritance taxes. Residents are, however, subject to federal estate tax and inheritance laws. Note that if you inherit property or assets from another state, it’s that state’s laws that apply. The individual income tax rate in Colorado is 4.63%.

When it comes to choosing a financial advisor, you want to pay special attention to the certifications they have. These certifications provide insight into the advisor’s education and skills. Certified financial planners (CFPs) and chartered financial analysts (CFAs) are two of the most esteemed certifications: They require extensive coursework to acquire, as well as adherence to ethical standards.

Whether it’s important to find an advisor in your area depends on how you want to interact with your advisor. Many people like meeting with their advisor in person, but some are fine with communicating remotely. Others don’t mind traveling out of state to meet with their advisor in person. While choosing a local advisor is generally the most convenient, the most important factor is that you find a qualified advisor who can best meet your needs.

While most financial advisor firms can help you with retirement planning, not all specialize in it and some only provide asset management services. If retirement planning is a priority for you, be sure to ask a financial advisor what services they offer and how much experience they have in the area in which you need assistance.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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What Is a Financial Planner and Do I Need One?

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone and is not intended to be a source of investment advice. It may not have not been reviewed, commissioned or otherwise endorsed by any of our network partners or the Investment company.

Written By

Reviewed By

Financial planners are professionals who have the skills and experience to help you map out a healthy financial future and course-correct along the way as needed. They can help you develop a strategic financial plan that takes into account your assets and goals in order to build and maintain your financial health.

When it comes to your finances, just winging it could cost you big time, so a financial planner could prove helpful. Here’s what you need to know about what they offer, how much they cost and how you can find one to work with.

What does a financial planner do?

As their title suggests, financial planners help people develop financial plans. These plans can range from simple budgets to more complex plans that include investments, retirement strategies and beyond. While each financial plan is unique, the goal is the same: to help clients achieve their financial goals both in the short and long term.

Financial planners start by evaluating a client’s current financial situation, helping them set realistic goals and then mapping out strategies to help them achieve those goals. Typically a holistic approach to one’s overall financial health, these plans may involve a variety of components including the following:

  • Budgeting
  • Evaluation of a client’s current financial situation and goals
  • Investment recommendations
  • Debt management
  • Tax advice
  • Insurance advice
  • Estate planning
  • Retirement planning
  • Education planning

While some financial planners can help you with any of these components, not all financial planners have the experience or credentials to provide some services. For example, if you want your plan to include estate or retirement planning, you want to make sure you hire a planner who can adequately guide you in these areas.

Also, not all financial planners can provide investment advice. Only those who have registered with the SEC or their state securities regulator are allowed to do so. To check a financial planner’s background, visit investment.gov.

Do you need a financial planner?

Almost anyone can benefit from working with a financial planner. That being said, the importance of hiring a financial planner can vary depending on a number of factors, including your age, income, assets and level of comfort with handling financial planning yourself.

In general, the older you are and the more assets you have, the more you may want to consider working with a financial planner. On the other hand, the sooner you have a financial plan, the sooner you can start reaching your goals, so it’s never too early to start.

There are also some significant life events that may make financial planning a priority. They include milestones such as:

  • Marriage and divorce
  • Inheriting money
  • Planning for the educational expenses of children
  • Buying a home
  • Incurring large debt due to illness, job loss or other circumstances
  • Changing jobs

However, there’s essentially nothing that a professional financial planner does that people can’t do themselves — especially with the plethora of free financial advice and online tools widely available today. Of course, doing so requires the time and willingness to learn, but some do it successfully.

In most cases, however, the years of education and experience that professional planners have can offer a valuable advantage to clients, particularly when they have more assets at stake or their circumstances are more complicated.

Financial planner vs. financial advisor: What’s the difference?

The difference between a financial planner and a financial advisor is subtle, but important nonetheless. A financial planner is, in fact, a type of financial advisor — financial planner is just a more-specific designation.

Services offered: In general, a financial advisor focuses primarily on investments, while a financial planner takes on the entire scope of a client’s finances, including components like retirement planning, estate planning, budgeting and more. If you just want to put some money in the stock market or make other investments, then a financial advisor can likely meet your needs, but if you want to take a look at your entire financial picture and map out a course for the future, which may include investments, then you likely want to seek out a financial planner. After a financial planner maps out that course, then you may want to hire a financial advisor to help you navigate the investment portion of the plan or you can choose to do so yourself.

Certifications and licenses: There are also differences in the certifications they hold. While a certified financial planner (CFP) designation is the gold standard for financial planners, financial advisors must have a license through the Financial Industry Regulatory Authority (FINRA) in order to process investments.

It’s important to understand the difference between titles and licenses when it comes to financial professionals. There’s nothing stopping anyone from calling themselves a financial planner. It’s the licenses, however, that tell you how much training they have and the standards to which they’re held. While some licenses are awarded by trade groups or other private entities, there are legal protections that are only afforded to you if your advisor is registered with federal or state authorities.

What qualifications and certifications do financial planners have?

There are several certifications that financial planners can earn, but the CFP certification is the main one to look for when you’re considering financial planners.

Becoming a CFP requires passing a rigorous test and agreeing to continued financial education on an ongoing basis. CFPs are also held to a fiduciary standard, which requires them to put their clients’ best interests before their own. CFPs are governed by the CFP Board, which is an independent group rather than a government agency. While the CFPs are ultimately overseen by the U.S. Securities and Exchange Commission (SEC), the CFP Board may set standards that are even higher than what federal law requires.

Aside from the CFP designation, other certifications that financial planners have may include:

  • Chartered financial analyst (CFA)
  • Chartered financial consultant (ChFC)
  • Certified investment management analyst (CIMA)

Each governing organization has its own set of standards that individuals must meet in terms of testing and education to receive their credentials. While some organizations require their members to meet a fiduciary standard, none are overseen by a government agency.

There is a call by many in the industry for the SEC to adopt a fiduciary standard for all financial advisors but currently there isn’t one. That means it’s important to thoroughly investigate the background of a financial planner. For a complete list of professional financial designations and what they mean, check out FINRA’s Professional Designations tool.

How much does a financial planner cost?

Average Financial Planner Cost By Fee Type
Fee TypeAverage Rate
A percentage of assets under management0.50% to 1.25%
Fixed fee$1,500 to 7,500
Hourly fee$100 to 400

The cost of professional financial planning can range widely according to the scope and complexity of the services provided.

Some people may just need one-time financial planning services to help them create a plan that they will then execute themselves. In this case, financial planners typically charge either a one-time fixed fee, which can run from $1,500 to $7,500, or an hourly rate ranging from $100 to $400 per hour, depending on the work required.

Other clients may hire a financial planner to provide ongoing support on a limited basis or more extensive support on an ongoing basis. These types of services are typically billed either at an hourly rate or as a percentage of the assets you’re asking them to manage, with the rate usually ranging from 0.50% to 1.25% of assets under management. Some financial planners may receive a commission, typically between 3% and 6% of the price of the financial products they sell or recommend to clients.

Fee-only vs fee-based financial planner

Another key distinction when it comes to financial planners’ fees relates to the ways in which they are compensated. There are two basic camps: Fee-based financial planners and fee-only financial planners.

Fee-only financial planners receive payment in fees only from their clients. Fee-based financial planners, on the other hand, receive payment from their clients as well as from other sources, which may include commissions from products they sell to their clients.

Since fee-based planners are incentivized by commissions, it’s possible for them to encounter conflicts of interest and, potentially, put their own financial gain ahead of their clients’ best interests. For example, fee-based financial advisors may be financially incentivized to recommend a higher-priced product to you to increase their earnings when an equally good, yet less-expensive, product may be available.

How to find a financial planner

Comparison of the Different Types of Financial Planners

Type of financial planner

Typical servicesBest for...
Traditional financial planner Full range of servicesThose who like a more personal experience and have more robust and/or complicated financial needs
Robo-advisorPrimarily handles investmentsThose who are comfortable with technology and don’t need a personalized experience; also for those who want to save on fees
Online financial planningFull range of servicesThose who want a bit of personalization but don’t mind working online

When it comes to choosing a financial planner, you shouldn’t just settle on the first name you come across. Beyond the types of certifications the planners have and how they charge clients, you’ll also want to consider the way in which you want to interact with them. In particular, there are three primary types of financial planning services to consider:

  • Traditional financial planner: A traditional financial planner will typically meet with you in person. They can offer a one-time plan or ongoing support at a level of your preference. They typically offer the most personal experience for those who want a one-on-one relationship and generally charge the steepest fees because of this higher level of service.
  • Robo-advisor: If a personalized experience isn’t as important to you, then a robo-advisor may be an option to consider. While these automated advisors primarily focus on investments, they may also provide some tools to help you develop a financial plan, save for college and more. There’s little to no human involvement in the process, though some may provide access to a human advisor, usually at an extra cost, if you request it. The fees for robo-planners are typically lower than those of traditional planners.
  • Online financial planning: If you don’t need as extensive of guidance as that typically offered by a traditional financial planner, but aren’t quite sure you’re ready to automate all your planning, online financial planning can offer a happy medium. Online financial planning still offers personalized advice as opposed to relying on algorithms, but interactions occur mostly online or over the phone. These planning services are typically less expensive than traditional financial planners but more costly than robo-advisors.

While all three types of financial planners can help you map out your financial future, your unique financial circumstances and personal preferences will help you choose the right one for you. Beyond that, you want to make sure your planner has adequate qualifications and abides by fiduciary duty, and that you understand their means of compensation. Checking these boxes is a good way to ensure you’re working with a financial planner who can help you plan your best financial future.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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What Is a Fiduciary Financial Advisor?

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A fiduciary financial advisor is a financial advisor who is legally and ethically bound to act in their clients’ best interests at all times. What’s surprising to many, however, is that not all financial advisors are fiduciaries, meaning some are legally allowed to make a profit at their clients’ expense.

Here’s what you need to know about the differences between fiduciaries and non-fiduciaries, how recent regulations impact them and how the financial advisor you choose may affect your investments.

The fiduciary standard for financial advisors

So what is an investment advisor’s fiduciary duty? Generally speaking, financial advisors bound by fiduciary duty must put their clients’ best interests before their own.

Currently, all financial advisors who are registered with the Securities and Exchange Commission (SEC) — known as Registered Investment Advisors (RIAs) — are bound by fiduciary duty. However, not all financial advisors are RIAs, and therefore some don’t adhere to the fiduciary standard. That means that some financial advisors are legally able to put their own interests ahead of their clients’ and recommend investments that make them a profit at their clients’ expense.

Changing regulations around fiduciary duty

In recent years, there have been attempts to bring more conformity to the industry in terms of how and to whom fiduciary duty applies.

Department of Labor’s fiduciary rule: In 2016, under President Barack Obama, the Department of Labor’s fiduciary rule went into effect. It required all financial services professionals providing advice on retirement accounts, such as 401(k) plans and individual retirement accounts (IRAs), to follow fiduciary standards. In 2018, however, the rule was struck down by a federal court after a change in the administration.

Regulation Best Interest: After that, the Securities and Exchange Commission (SEC) took matters into their hands and created a new rule, called Regulation Best Interest (Reg BI), which took effect in June 2020. It differentiates between RIAs, who are financial advisors that only provide advice, and broker-dealers, who provide advice and sell products and investments from which they may earn a profit.

Previously, only RIAs were required to meet fiduciary standards, while broker-dealers were required only to follow the less-stringent suitability standard (see more below). The new rule doesn’t go as far to require broker-dealers to follow the fiduciary standard, but it does require them to make recommendations in the best interests of their clients and sets out requirements that are more stringent than the suitability standard.

Under Regulation Best Interest, brokers may no longer call themselves advisors if they aren’t following the fiduciary rule. RegBI also lays out stipulations they must adhere to, including the following:

  • They must provide clients with an explanation as to why they’re making the recommendations they are making.
  • They must put their customers’ best interests ahead of their own.
  • They must take steps to prevent conflicts of interest and disclose any that are related to their recommendations.
  • They must craft their own policies and strategies to comply with the new rule.

Additionally, both RIAs and broker-dealers must now disclose important information about their company in a document: a new client (or customer) relationship summary, also known as Form CRS. This includes information about their fees, any conflicts of interest and which standard of conduct they follow.

The fiduciary standard vs. the suitability standard

The fiduciary standard

The suitability standard

  • Advisors must put the client’s interest above their own
  • RIAs are required to follow it, but brokers aren’t
  • Overseen by the federal government
  • More stringent than the suitability standard
  • Advisors may make client recommendations for their own personal gain
  • Broker-dealers follow it
  • Overseen by FINRA, a private industry group
  • Less stringent than the suitability standard

Currently, RIAs are the only financial advisors required to adhere to the fiduciary standard. Broker-dealers follow the less-stringent suitability standard, which only requires that they make recommendations that are “suitable” for the customer based on factors including their tax and financial status, objectives and risk tolerance. What’s suitable, however, doesn’t always necessarily mean what’s best for you.

As of June 2020, however, broker-dealers must also act in their clients’ best interest. Previously, broker-dealers could recommend products that would earn them the highest commission, even if they weren’t necessarily the best ones for their clients. Now, they must act in their clients’ best interest, but only at the time they make a transaction recommendation. Those who abide by the fiduciary standard must act in their clients’ best interest at all times, including while providing ongoing advice and monitoring client accounts.

What does it mean to have fiduciary duty?

The duty of a fiduciary financial advisor is to hold their clients’ trust by making decisions in their clients’ best interests. The importance of fiduciary duty lies in the confidence it provides a client so they don’t have to second-guess the motive for the advice they’re given. They can be rest assured that they are being given the best, most objective advice that the advisor has to offer. They don’t have to wonder if they’re being steered in a direction because their advisor stands to make a larger commission.

Think of it like going into a shoe store to purchase a pair of shoes. Under fiduciary duty, the salesperson would advise you to purchase the pair of shoes that fits you best and looks best on your feet. Without fiduciary duty, the salesperson might try to convince you that the too-small, odd-looking pair is amazing, because it’s a more expensive shoe that will mean a bigger commission for them. Of course, there’s no fiduciary rule when it comes to shoe sales, but it illustrates the point as to the difference between working with a fiduciary financial advisor as opposed to a non-fiduciary.

Is fiduciary duty required by law?

As of now in the financial industry, only RIAs are required by law to meet the fiduciary standard. Financial advisors aren’t, however, the only professionals who are bound to fiduciary duty by law.

Other professions that involve trust with their clients, such as real estate agents, clergymen, physicians and attorneys, are also fiduciaries. While the precise rules vary by profession, in general, they all require that the professional act in the best interest of their clients.

What is a breach of fiduciary duty?

A breach of fiduciary duty involves an action in which the fiduciary puts their own interests before a client’s. In the case of a financial advisor, a breach of fiduciary duty would involve the advisor making recommendations that earn them a profit at a client’s expense. Examples of breach of fiduciary duty may include actions like charging excessively high commissions, misrepresenting potential conflicts of interest or any cases in which a client loses money due their advisor’s fraudulent or negligent actions.

If a client believes there has been a breach of fiduciary duty, they can sue the advisor for damages, including trading losses and well-managed account losses.

Why should you choose a fiduciary financial advisor?

According to the National Association of Personal Financial Advisors (NAPFA), non-fiduciary advisors cost investors up to $17 billion a year. That’s a lot of money, which could have been in the pockets of individual investors.

The fees and services that fiduciaries and non-fiduciaries offer may be similar, but it’s the missed opportunities that can result in this loss to investors. For example, a non-fiduciary may advise you to purchase a “good” product because they will receive a larger commission or another incentive, such as a prize, for selling that product. However, there may be a better product that would have benefited you more financially that they didn’t recommend because it didn’t offer an incentive for them.

That doesn’t mean that all non-fiduciaries are going to provide bad financial advice, but choosing a fiduciary provides extra assurance that your financial best interest is that advisor’s biggest priority. You don’t have to worry that their advice may be costing you potential cash.

How to find a financial advisor who is a fiduciary

There are a number of factors to consider when choosing a financial advisor, but determining if they’re a fiduciary is one of the most important. While Regulation Best Interest provides more assurance that all advisors are working in your best interest, the fiduciary rule is the most-stringent standard, and fiduciaries provide the most reassurance that you’re getting your best advice possible.

So, how do you find a financial advisor who is a fiduciary? There are a number of ways to find an individual or firm that abides by fiduciary duty:

  • SEC search tool: The SEC offers a search tool that allows you to look up relationship summaries, which includes information about how they’re registered, their professional background and more. If you already have an advisor, then they have to provide you with a copy of this information.
  • IAPD: You also can visit the SEC’s Investment Adviser Public Disclosure (IAPD) website to determine which advisors are RIAs and which are registered as a broker with FINRA (Financial Industry Regulatory Authority). You can also access an advisory firm’s Form ADV here, which provides information on its services, fee structure and any disciplinary disclosures.
  • Professional organizations: Another option when searching for a fiduciary advisor is to visit the websites of professional organizations that require their members to be fiduciaries. This includes the NAPFA, the Fee Only Network and the Alliance of Comprehensive Planners.

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