A financial adviser or financial planner is someone who gives financial advice to potential customers based on their current financial circumstances. In the United States, financial advisers must meet certain licensing requirements and typically must complete special training if they wish to offer advice to individuals. Financial advisers can provide a wide range of advice for people of all ages including retirement, investing, estate planning, and more. Some advisers to work directly with individuals, while others work through agencies such as pension or investment firms. Regardless of whether an individual goes through a bank, broker, or other financial professional, they are advised to seek financial advice from a financial adviser at some point in their lives.
The United States Department of Labor requires registered financial advisors to meet certain standards. According to these regulations, all registered financial advisors should have either a fiduciary standard or a qualified performance organization. Both the standard and the qualified performance organization are designed to ensure that investment advisers provide reliable and accurate advice to their customers. Registered representatives should also be certified with an expertise level of three out of five. Additionally, all registered representatives should be insured against errors and omissions. As a minimum, financial advisors will need to pass a certification exam from the National Association of Securities Dealers (NASD) and a fee-based examinations from the FINRA or Financial Industry Regulatory Authority.
Depending on the type of financial advisor provided and the business they serve, there are many different areas that they can focus their services. There are a variety of areas in which a financial advisor provides financial advice to their clients including asset protection, estate planning, retirement planning, and asset allocation. In addition, many financial advisors provide tax planning and investment management services for their clients. Regardless of the area of specialization that a financial advisor provides, they should have a thorough understanding of how all of these areas fit together and should be willing to discuss all of their products and services with clients.