Financial Advisor, Wealth Advisor, Investment Advisor: What's the Difference?

Once you've decided it’s time to get some professional financial help, you may be asking yourself: “Which type of financial professional is best for me?” From a financial advisor to an investment advisor to a wealth advisor, it’s helpful to know the differences between each category of financial experts before committing to a long-term engagement. According to the (Certified Financial Planner) CFP Board, “consumer use of financial advisors has increased significantly in the last five years,” going up approximately 10 percent in the span of just five years.¹ 

When advisors were surveyed about the benefits of cash flow management and budgeting, nearly 100 percent of them stated that their clients became more confident and secure about their financial futures after utilizing the service.²  Before you make a final decision, below are some of the key differentiators between each group so you can make your decision with confidence.

Financial Advisor

The most used term, a financial advisor is someone who helps you with one or more aspects of your financial life. Every financial advisor is different in what specific areas they specialize in and what services they provide, so if you are looking for help in one particular area, it is always best to ask. 

Another term or title you may see for a financial advisor is a financial planner. Financial planner may be a better title or description for a financial advisor who offers not just investment and retirement advice, but holistic comprehensive financial planning to help you achieve many other goals such as purchasing a home, college education for children, and other large purchases, as well as insurance planning, tax planning, estate planning, debt management, cash flow and budgeting, and many other areas that affect and are affected by your finances.

Investment Advisor

An investment advisor is a professional who focuses on just that - your investments. An investment advisor will manage your portfolio with the goal to get a higher rate of return over a longer time period. Before they begin designing your portfolio, investment advisors should evaluate your current financial picture, as well as determine your optimal risk tolerance, which may involve you filling out a questionnaire. 

After discussing your needs and goals with your advisor, they typically will then present an investment strategy tailored according to the unique aspects of your life. Some investment advisors actually manage your money and do the investing for you, others simple "advise" on what you should do, leaving you to implement the strategies on your own. 

Wealth Advisor

With more money comes more responsibility, and wealth advisors’ duties are catered specifically to those who have a decently-sized estate, often labeled as high-net-worth and ultra-high-net-worth individuals. Also known as wealth managers, some of the topics wealth advisors cover include risk management and estate planning.

Keep in mind, many firms may categorize their own business under more than one of these labels (they might say they are a "financial advisor" as well as a "wealth advisor"). Of course, the best course of action is always to contact any financial professional you are interested in working with directly and learn more about their business model and what services they provide to their clients.

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