What does a financial advisor do?

Financial advisors help clients with various aspects of their financial lives. Not all financial advisors offer the same services, but many assist with financial goals such as budgeting, retirement planning, investment management, taxes, insurance and estate planning. These areas are just some of what financial advisors do to help their clients.

Do I need a financial advisor?

Deciding whether you need a financial advisor or not can be a difficult decision. Working with a financial advisor can be expensive, so it probably only makes sense if you really need one. Hiring a financial advisor may make sense if you’re trying to develop an overall strategy, working through certain life events, or just lack the experience necessary to manage your finances on your own.

When should I switch financial advisors?

Not everyone hires the right financial advisor on their first try. It may be necessary to choose a new financial advisor if you aren’t getting enough attention from your current advisor, their fees are too high or if they push you toward certain investments that don’t make sense for your needs.

How much does a financial advisor cost?

Financial advisor costs can vary quite a bit from one advisor to the next. Some advisors charge a fee based on the level of assets under management, while others charge a flat rate or by the hour. In general, 1 percent is a good threshold to keep in mind when considering financial advisor costs. If you’re paying much more than that, be sure you’re getting plenty of service in return for your annual fee, or find another option for less.

What questions should I ask a financial advisor?

When you meet a financial advisor for the first time, there are some key questions you should get answers to. One of the most important is how they’re compensated and whether or not they’re a fiduciary. A fiduciary means they’re required to put your interests before their own or their firm’s. You’ll also want to understand how their firm evaluates them and what would happen to your account if they left the firm.

What is the difference between a financial planner and a financial advisor?

It can be hard to tell the difference between a financial planner and a financial advisor, and the two terms are often used interchangeably. However, there are some differences to keep in mind. Financial advisors typically focus on helping clients manage their investment portfolios and work toward goals such as saving for retirement. A financial planner is more likely to help with your overall financial picture and may assist with things such as budgeting or developing a comprehensive financial plan.

Should I choose a robo-advisor, online financial planning service or in-person financial planner?

Whether you choose a robo-advisor, online financial planner or an in-person financial advisor will depend on your own preferences as well as the level of service you are looking for from an advisor. In general, robo-advisors provide the most basic level of service, building you an investment portfolio based on your risk tolerance and financial goals. An online financial planner will provide a more personalized plan beyond investments and can help with questions you may have. An in-person financial advisor will likely offer the most complete level of service and can assist with several different areas of your financial life such as investments, retirement planning or even taxes. The fees and costs you’ll pay for each one varies, but typically increases with the level of service you’ll receive. Robo-advisors are typically the least expensive, followed by online financial planners. An in-person advisor will be the most expensive and may charge you more than 1 percent of your assets annually.

6 Best Financial Advisors of November 2024

Bankrate evaluated dozens of financial advisor firms based on various factors including:
- Assets under management: Bankrate considered how much a firm had in client assets to identify firms that had already established relationships with a large number of clients. A higher AUM level can sometimes translate to lower fees as well.
- Fees: Advisory fees vary widely depending on the advisor, but firms were given credit for having lower costs.
- Different services offered: Firms were given more credit for offering a greater number of services beyond basic financial advice such as estate planning, tax services and more.
- Investment minimums: The amount required to get started with an advisor can depend on the advisor and the specific program you’re using. Firms were given more credit for having lower investment minimums.
- Client satisfaction survey came from an independent market research firm.
To learn more, read our full ratings methodology for best financial advisors.

Vanguard

Vanguard may be best known for its plethora of low-cost fund options, but it also offers several different financial advisor options that will meet the needs of a variety of clients. Vanguard offers three different levels of service that allow you to speak with a financial advisor with minimum asset levels ranging from $50,000 to $5 million. All three service levels provide access to personalized financial planning, various investment options and automated tax-loss harvesting.

If you’re looking for a dedicated advisor to work with over time, you’ll need to choose Vanguard’s Personal Advisor Select program, which comes with a $500,000 investment minimum. Those looking for more complex financial advice such as estate planning or charitable giving advice will need Vanguard’s Personal Advisor Wealth Management services. All of Vanguard’s financial advisor options come with annual fees ranging from 0.30 percent to 0.40 percent, and the fees decline as your assets grow.

AUM: $118.9 billion in discretionary client assets
Account minimums: $50,000 to $5 million depending on level of advice
Fees: 0.30 percent to 0.40 percent

Charles Schwab

Charles Schwab offers one of the best online brokerage platforms, but you can also find financial advisor solutions that meet your needs. Schwab financial consultants are available for free to clients with $500,000 in assets, and they can help you build a financial plan and sift through different investment options. For those looking for an even more personalized approach, Schwab Wealth Advisory is available starting at $1 million in assets and charges an annual fee of 0.80, with the fees declining at higher asset levels.

Schwab can also help you find an independent financial advisor in your area through its website findyourindependentadvisor.com. Fees for these advisors may be significantly higher than those for Schwab’s wealth advisory business, however.

AUM: $563.9 billion in “advice solutions”
Account minimums: $500,000 to $1 million depending on level of advice
Fees: 0.80 percent; advisor network fees vary

Fidelity Investments

Fidelity has been around for more than 75 years and is one of the largest financial services companies in the U.S. The company offers a handful of options for clients looking to work with financial advisors. If you’re looking for a basic level of service such as developing an investment strategy and staying on track with your goals, you may want to consider Fidelity’s phone-based advisors. They’ll help you develop a retirement savings plan and tax-smart investing moves to help you reach your goals for an advisory fee of 1.1 percent and a minimum investment of $50,000.

If you want your own dedicated advisor, you’ll need at least $250,000 in assets and could pay up to 1.5 percent in annual advisory fees. For this higher fee, you’ll also get access to a broader array of services, such as insurance and estate planning.

AUM: $652.6 billion in discretionary client assets
Account minimums: $50,000 to $2 million depending on level of advice
Fees: 0.50 percent to 1.50 percent

Facet

Facet is one of the most unique financial advisor firms on this list in that it doesn’t charge an annual fee based on your level of assets, but rather charges a flat fee based on the complexity of your financial situation. You’ll get advice from a certified financial planner (CFP) who acts as a fiduciary, and your fee generally ranges from $2,000 to $8,000 per year. While this might sound like a lot, it actually ends up being quite reasonable for investors with $1 million or more in assets, and can even make sense for those with lower asset levels.

You’ll work with a dedicated financial advisor that you meet with via video conference. They’ll be able to help you with any number of financial issues such as retirement planning, taxes, buying a house, saving for college, insurance, estate planning and more. There are no investment minimums, so anyone can sign up, though the fees make the most sense for those who have already accumulated significant savings.

AUM: $2.1 billion in discretionary client assets
Account minimums: None
Fees: $2,000 to $8,000 per year

J.P. Morgan Private Client Advisor

You may know J.P. Morgan as the largest bank in the U.S., but it also offers financial advisory solutions at a reasonable rate, relative to most other financial giants. With J.P. Morgan Personal Advisors you can work with a team of advisors to help develop a personalized financial plan. These advisors are fiduciaries, so they’ll put your interests before their own, and the fees start at 0.6 percent for assets up to $250,000.

If you’re looking for a more personalized experience, J.P. Morgan Private Client Advisor allows you to work one-on-one with a dedicated advisor in your area. You’ll get a personalized financial strategy and an investment portfolio that’s tailored to your needs and goals. Fees for this service start at 1.45 percent annually, but decline as your portfolio grows. There may be additional fees based on how your portfolio is invested.

AUM: $196.5 billion in discretionary client assets
Account minimums: $10,000 to $100,000 depending on type of account
Fees: Maximum advisory fee of 1.45 percent; other fees may apply

Edward Jones

Edward Jones offers a traditional financial advisor experience, but its fees are below that of other well-known firms, which can often run over 2 percent each year. You can get started with as little as $5,000, but you’ll need at least $25,000 if you want your advisor to manage your portfolio for you. Fees start at 1.35 percent, but decline at higher asset levels. There is also a portfolio strategy fee for certain accounts that starts at 0.19 percent and declines to 0.09 percent for assets over $10 million.

Edward Jones has nearly 19,000 financial advisors with offices in all 50 states. The firm offers various services including retirement planning, education savings, estate planning, insurance and more.

AUM: $252.4 billion in discretionary client assets
Account minimums: $5,000 to $500,000 depending on type of account
Fees: program fee starts at 1.35 percent; other fees also apply

Alternative option: Robo-advisors

Investors who are largely looking for help managing their investments may benefit from using a robo-advisor instead of a traditional financial advisor. Robo-advisors use algorithms to build a portfolio based on your goals and risk tolerance, and typically come with low investment minimums and fees well below that of most human advisors.

Both robo-advisors and human financial advisors can help with investment management, but human advisors typically offer a greater number of services and a deeper relationship, albeit at a higher cost. Some robo-advisors offer the option of working with a human advisor if that’s important to you.

Here are some of the best robo-advisors to consider if you decide you don’t need all the services offered by traditional financial advisors.

How to choose a financial advisor

Choosing a financial advisor can be intimidating and frustrating, so it helps to proceed methodically. Here are some key things to consider as you make your decision.

What kind of relationship are you looking for? You may need only a one-time planning session with an advisor to get you on the right track, or you may want an ongoing relationship where an advisor manages your portfolio and meets with you to provide regular updates. Understanding what you need from an advisor will help you identify potential fits.
Know how an advisor gets paid. How an advisor is compensated is one of the most important things to understand, because how they get paid can impact the advice they give you. You’ll likely want to work with an advisor who’s a fiduciary, which means they’re required to put your interests before their own or their firm’s. Advisors who earn commissions on the sale of certain products may push those products on clients even when they aren’t the best choice. Fee-only advisors don’t earn commissions on the sale of products, so their advice is more likely to be tailored to the needs of the client.
What are their credentials? You’ll also want to understand an advisor’s qualifications before hiring them. Advisors with professional certifications such as the Certified Financial Planner (CFP) or Chartered Financial Analyst (CFA) designations have gone through rigorous training and are well-respected in the industry.

Financial advisor FAQs

Financial advisors help clients with various aspects of their financial lives. Not all financial advisors offer the same services, but many assist with financial goals such as budgeting, retirement planning, investment management, taxes, insurance and estate planning. These areas are just some of what financial advisors do to help their clients.
Deciding whether you need a financial advisor or not can be a difficult decision. Working with a financial advisor can be expensive, so it probably only makes sense if you really need one. Hiring a financial advisor may make sense if you’re trying to develop an overall strategy, working through certain life events, or just lack the experience necessary to manage your finances on your own.
Not everyone hires the right financial advisor on their first try. It may be necessary to choose a new financial advisor if you aren’t getting enough attention from your current advisor, their fees are too high or if they push you toward certain investments that don’t make sense for your needs.
Financial advisor costs can vary quite a bit from one advisor to the next. Some advisors charge a fee based on the level of assets under management, while others charge a flat rate or by the hour. In general, 1 percent is a good threshold to keep in mind when considering financial advisor costs. If you’re paying much more than that, be sure you’re getting plenty of service in return for your annual fee, or find another option for less.
When you meet a financial advisor for the first time, there are some key questions you should get answers to. One of the most important is how they’re compensated and whether or not they’re a fiduciary. A fiduciary means they’re required to put your interests before their own or their firm’s. You’ll also want to understand how their firm evaluates them and what would happen to your account if they left the firm.
It can be hard to tell the difference between a financial planner and a financial advisor, and the two terms are often used interchangeably. However, there are some differences to keep in mind. Financial advisors typically focus on helping clients manage their investment portfolios and work toward goals such as saving for retirement. A financial planner is more likely to help with your overall financial picture and may assist with things such as budgeting or developing a comprehensive financial plan.
Whether you choose a robo-advisor, online financial planner or an in-person financial advisor will depend on your own preferences as well as the level of service you are looking for from an advisor. In general, robo-advisors provide the most basic level of service, building you an investment portfolio based on your risk tolerance and financial goals. An online financial planner will provide a more personalized plan beyond investments and can help with questions you may have. An in-person financial advisor will likely offer the most complete level of service and can assist with several different areas of your financial life such as investments, retirement planning or even taxes.

The fees and costs you’ll pay for each one varies, but typically increases with the level of service you’ll receive. Robo-advisors are typically the least expensive, followed by online financial planners. An in-person advisor will be the most expensive and may charge you more than 1 percent of your assets annually.

Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.

6 best financial advisors of November 2024

The Bankrate promise