Financial advisors can help you with your financial goals. You’ll find options from automated investment management to traditional services. We’ve considered the best financial advisors based on commissions, account services, portfolio management, and overall quality.
Axos Managed Portfolios offers automated investment with a low fee and customizable portfolio. Investors can easily track their goals and adapt milestones at any time. Plus, Axos rebalances your portfolio to keep your asset allocation on track with your goals at no extra cost.
M1 Finance allows you to invest all your money in any portfolio, or customize it to suit your needs. It then manages your account by maintaining your allocations within the selected Pie through automatic rebalancing. Although it doesn’t offer tax-loss harvesting, it has a feature called ‘tax minimization’ that enables you to sell asset positions in a tax-favorable way.
What we like
Automated investing with a high level of customization
No trading or management fees or commissions
No initial minimum deposit
You can trade fractional shares
Socially responsible investing portfolio option
What we don't
No tax-loss harvesting
No access to mutual funds, futures, forex, or options investing
Financial advisors are professionals who help people manage their money. They charge fees for their services, depending on the type of advisor you choose.
How do financial advisors work?
Financial advisors work in a variety of ways. Some are employed by banks and other financial institutions, while others are independent contractors working for themselves or a company that provides financial planning services.
Some financial planners work with clients hourly, while others charge a flat fee. Fees can vary widely based on your situation’s complexity and portfolio size.
Most financial advisors offer a service to help you manage your money. This may include setting up an investment portfolio or finding ways to save money on taxes or insurance premiums.
What can financial advisors help you with?
Here are ways financial advisors can help you:
Investment management: Financial advisors typically specialize in managing investments for clients. They may manage your portfolio themselves or recommend that you invest in mutual funds or exchange-traded funds (ETFs), which professional investment managers manage.
Retirement planning: Financial advisors can help you plan for retirement, such as determining when to start taking Social Security benefits, how much to contribute to your 401(k) and IRA accounts, and how much life insurance you need based on your age, health status, and current assets. They can also advise on supplemental income sources such as annuities and long-term care insurance, which can help pay for services such as assisted living care and nursing homes during retirement when medical costs rise substantially due to chronic illness or disability.
Financial planning advice: Financial planning advice is any service that helps you plan your finances in the future, whether it’s retirement planning or taking on debt. A financial planner will help you set goals, find ways to meet them, and offer guidance. For example, they may suggest what types of investments might be best for you based on your life cycle and situation.
Tax planning: Tax planning is a way to find ways to reduce your taxes. For example, your advisor may recommend adding funds in an IRA to delay taxes or selling securities to incur a capital loss to offset capital gains. There are multiple ways to approach tax planning.
Insurance advice: Insurance advice includes helping people choose the right insurance and coverage based on their needs. Advisors may sell insurance products directly or refer clients to an insurance agent who sells policies from several companies. They may also advise how much coverage each person needs and how much they could save by switching policies or making other changes.
Who are financial advisors best for?
Here are groups that might benefit from working with a financial advisor:
Small business owners and entrepreneurs: Entrepreneurs need to think about more than just their finances. They must also consider how decisions affect their employees, customers, and investors. That’s why it’s so important for small business owners and entrepreneurs to work with an advisor who understands their unique situation.
Newlyweds or young couples: The first few years of marriage can be exciting, but it can also be financially challenging. People newly married or starting on their own for the first time should consider talking with a financial advisor before making major decisions about their money, such as buying a home or saving for retirement.
People who want to plan for their children’s college education: A financial advisor can help you determine how much money you’ll need to save each month so your kids can attend college. They’ll also help you find a way to save that money in a tax-advantaged way.
People with multiple income sources: If you have multiple income streams — for example, if you’re self-employed or have multiple jobs — then a financial advisor can help smooth out your cash flow and ensure that all your money goes toward what matters most.
People who want someone else to manage their investments and taxes: Hiring a financial advisor means letting go of some control over what happens with your money — but it also means getting someone who knows what they’re doing when managing investments and taxes.
What are the benefits of using financial advisors?
The benefits of using financial advisors are numerous. Below are some of the most important:
Providing emotional guardrails: As markets tend to be volatile at times, financial advisors can serve as an emotional guardrail, which is particularly important for people who are new to investing or don’t have much experience managing money.
Avoiding unnecessary taxes: The tax code is extremely complicated, and many taxpayers fail to take advantage of all the tax deductions available. A good planner can help you avoid unnecessary taxes.
Creating a long-term financial strategy customized to you: Financial advisors can help you create a long-term financial plan customized to your needs and goals. They’ll also help you make specific steps so you’re able to reach your goals. This is especially important since it’s easy to get confused about finances. It’s hard to know how much money you should save or how much debt you should pay off each month.
Using data-driven decision-making: Financial advisors use data-driven decision-making when determining whether or not an investment opportunity is worth pursuing. Data helps them evaluate risks and potential rewards and allows them to make smarter investment decisions in line with their client’s overall financial goals and objectives.
How to choose the best financial advisors
Here are some tips for finding the best financial advisor:
Find a real fiduciary: A fiduciary is required to act in your best interests. If an advisor is not required, they are likely working on commission or incentive-based compensation. This may make it hard to know whether they have your best interests. A fiduciary will be upfront about compensation and fees and never put their interests ahead of yours.
Check those credentials: You should also ensure that the advisor you’re considering has the proper credentials and licenses. Certified Financial Planners (CFPs) must pass a comprehensive exam covering many personal finance areas, including investments, taxes, and insurance. They must also abide by a code of ethics that prohibits conflicts of interest, such as recommending products that pay them higher commissions than others with similar features or risk profiles.
Understand how the advisor gets paid: Not all advisors charge the same way, so it’s important to understand how they get paid before you hire them. Some advisors charge an hourly rate, while others charge by commission or a flat fee. Flat fees are often lower than commission-based compensation, but other fees may come into play later. Look for advisors who offer transparent fee structures and who don’t sell products that aren’t in your best interest.
Search for clarity: Look at your investments and ensure no hidden fees or commissions are associated. If there are, find out how much they cost and if they’re worth it. It’s also important to know what kind of investment strategy your advisor is using — passive or active, for example — and whether this strategy is based on research that has been proven over time, and if so, how long.
Look for experience: An experienced advisor will likely know more about tax laws and regulations and industry trends that could affect your portfolio over time. They should also be able to offer guidance on managing your investments in different market conditions to help you achieve your goals.
This website contains information about various financial products and services, and we attempt to keep the information up to date. Certain information is provided by our partners and can be subject to change at any time without notice. Our editorial team spends a significant amount of hours on research, but the information is not legal or professional advice. The information provided is for educational purposes only. We earn a commission from our featured partners, but commissions do not affect our opinions or evaluations. Any opinions, analyses, reviews, or recommendations expressed are those of the author’s alone and have not been endorsed by any of our network partners.