What Does A Wealth Management Advisor Do & How Can They Help You?

December 10, 2018 · 5 minute read

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What Does A Wealth Management Advisor Do & How Can They Help You?

Often day-to-day tasks take up so much of our focus, we might not be spend enough time thinking about the big picture. Like, will you have enough to retire well—or, even better— retire early?

Will you live your golden years in a resort beach town or choose to live near the mountains? Or if you have entrepreneurial aspirations, should you open a winery or a little tech startup that you hope will hit it big? Those are all life-sized questions that need comprehensive answers.

It’s never too early, or late, to start planning for your future. Actively planning for retirement is one of the smartest decisions you can make when it comes to meeting your financial goals. You wouldn’t put off seeking medical care for health issues, so why would you put off thinking about the financial health of your future?

Financial planning can be overwhelming and there are a lot of options to consider if you’re looking for some guidance when establishing a plan for retirement. One option is to invest with a wealth advisor (or manager), who can help hone your financial strategy.

Wealth Manager vs Financial Advisor

Wealth manager, financial advisor, investment advisor, financial planner—there are so many options, and terms, and titles. When you’re looking for financial advice, navigating the professional landscape can seem confusing.

Certifications and licenses are one of the reasons there are so many terms and titles used to describe people who provide advice related to personal finances. So it pays to do a little research to determine who would work best for you.

What Do Financial Advisors Do?

Financial advisor is the broadest of the terms. The phrase can describe anyone who advises you on a financial plan, investments, or tax strategy implications. Be wary, though: some financial advisors are incentivized to suggest certain investments for commission purposes. So your first step should be to understand which type of financial advisor you’re looking for.

Up to 46% of millennials don’t have a good understanding of what financial advisors do. But under that big umbrella of financial advisors, the two most common types are financial planners and investment advisors.

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Financial Planners

Think of financial planners as “lifestyle planners.” They’re most suitable for helping you set up a budget, plan for tax time, save for retirement, or to plan your child’s college education. They should have completed professional requirements for their CERTIFIED FINANCIAL PLANNER™ practitioner designation.

Some, usually in larger companies, earn their keep by selling you products: insurance, stocks, mutual funds, and the like. Fee-only financial planners don’t sell products; they’re paid for their advice—per hour or at a certain rate. Fee-based planners may charge a fee but also may earn a commission from certain products, like mutual funds.

Investment Advisors

Investment advisors also encompass a range of financial professionals. Probably the biggest difference between a financial advisor and an investment advisor is that a Registered Investment Advisor has a fiduciary responsibility to put his or her client’s interests first. And as the name implies, they must register with the SEC, and are subject to various oversight and record keeping rules, among other obligations.

You can even look up individual people, so you can review their credentials . In fact, some financial planners are also Registered Investment Advisors.

If you’re unsure of your advisors intentions, it’s always best to ask about their priorities before you start working with them. With a broker, for example, you’d want to know whether he or she has a fiduciary responsibility to you or if he or she is selling the latest trending stock for commission.

What Does a Wealth Management Advisor Do?

Wealth management is a subset of financial advising. A wealth manager comes with the caveat that they focus on managing the assets of high earners. Think of them as a quarterback with a team of professionals behind them who can provide services and products. They usually have a big picture view of all your assets, from your retirement fund, to your real estate investments.

Think of them as consultants whose main objective is to provide a customized solution for you. They might place your assets in markets to enhance earnings and shift them out when it’s risky. Once the parameters are set, and the wealth manager understands your individual needs, you can focus your energy on other aspects of your life. If you think wealth management is only for the affluent, there are opportunities to get great advice, service, and solutions from a wealth advisor at very reasonable costs.

A wealth manager’s role is generally far more comprehensive than offering just investment advice. While investment advisors and financial planners focus on one piece of your financial situation, wealth managers combine several areas of financial guidance.

They are able to provide financial advice that addresses the entirety of a person’s financial life; including investment management, accounting and tax strategy consulting, estate planning, retirement planning, and more. They work closely with you to establish a plan to grow and maintain wealth. Here are three areas a wealth advisor can help you:

Investment Management and Risk Management

A wealth advisor will work with you to assess your tolerance for risk and then provide an investment strategy to help you reach your financial goals. For example, if you’re beginning to plan for retirement early in your career, you may be more apt to take on risk than someone who may be nearing the end of their career and is much closer to retiring.

Part of any investment plan also includes managing risk over time. This includes having adequate insurance for your financial investments and diversifying your portfolio to minimize risk.

Tax and Estate Planning

What does a wealth management advisor do when it comes to your taxes? While wealth managers do not offer tax advice, they can often coordinate with your attorney or accountant to strategize and minimize the taxes you owe by planning for tax efficiency.

Many wealth advisors can also help with estate planning strategies. Estate planning often involves more than just wills. For instance, there are advantages for setting up trusts, especially if you have dependents that will need caring for. Working with a wealth manager for estate planning can help get your affairs in order to avoid any surprises for your family down the road.

Real Estate

If you own investment property, this is where the wealth manager vs financial advisor debate will be quite impactful. Wealth advisors usually have more experience and skills to help you manage portfolios with valuable real estate. Since approximately 30 million Americans have invested in real estate , choosing an advisor who can help with financial planning and real estate might make sense.

What is Right For You?

Wealth managers can help you navigate unforeseen hurdles and ease your investing worries. Plus, they can be a great asset when defining your financial goals.

If you’re ready to prioritize investing, and want some guidance without paying exorbitant fees, consider opening a SoFi Invest account. We offer competitive wealth management with low cost funds, competitive advisory fees, no administrative fees, low account minimums, and extensive access to a team of credentialed financial advisors.

If you’re ready to explore options to maintain and grow your wealth, take a look at SoFi. You can get complimentary, personalized advice from real advisors when you open a SoFi Invest® account.


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SoFi can’t guarantee future financial performance.
This information isn’t financial advice. Investment decisions should be based on specific financial needs, goals and risk appetite.
SoFi doesn’t provide tax or legal advice. Individual circumstances are unique. Consult with a qualified tax advisor or attorney.
Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Advisory services offered through SoFi Wealth, LLC, a registered investment advisor.
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