Types of Financial Advisors

Asset managers and investment managers, financial planners and financial coaches: It’s enough to make you want to bury your money in the yard. But don’t fret. Below are the most common types of financial advisors and what they do.

9 types of financial advisors

1. Investment advisors

An investment advisor is a person or company who is paid to provide investment advice to clients or manage assets for clients.

While "investment adviser" is the legal term to denote a financial professional who must register with the U.S. Securities and Exchange Commission, it is also a job title — and is more commonly spelled "advisor."

2. Brokers and broker-dealers

A broker-dealer buys and sells securities (such as stocks, bonds and mutual funds) for clients (in which case, they’re acting as a broker), for their own account (as a dealer), or both. In addition to registering with the SEC, broker-dealers are also usually members of FINRA.

The financial products that a broker-dealer employee can sell depends on their licenses. For example, someone who has passed the Series 6 exam is limited to selling mutual funds, variable annuities and related products. A Series 7 license allows the person to sell additional securities^[0]

3. Certified financial planners (CFPs)

Financial advisors who are CFPs have met the CFP Board’s training and experience requirements, have passed the certification exam and have agreed to follow certain ethical standards. CFPs have a fiduciary duty to their clients, which means they must act in the client’s best interest rather than in their own best interests or in the best interests of their employers^[0]

Financial planners generally don’t need licenses or certifications to offer guidance on how to pay down debt, plan for retirement or create a budget, but some are also investment advisors (meaning they help clients decide which investments to buy and sell).

» Take the quiz: Should you get a financial advisor?

4. Financial consultants

Financial consultant is a general term anyone can use. But some financial consultants hold a chartered financial consultant (ChFC) designation. Chartered financial consultants have completed education requirements similar to CFPs. ChFCs have a fiduciary duty and must adhere to The American College’s code of ethics. You can verify a ChFC's credentials here.

5. Financial coaches

Financial coaches are often the most beginner-friendly financial professionals. Financial coaches focus on the basics of financial literacy, such as how to save money or reduce spending. Financial coaches can help their clients build wealth that an investment advisor may help them manage in the future.

6. Portfolio, investment and asset managers

Asset managers, portfolio managers and investment managers manage client investment portfolios. Some may deal strictly with investment portfolios, but others might offer other financial planning services too.

These advisors typically give investment advice in return for compensation and thus usually have to register with the SEC or the state. You should always double-check that they’ve done so through BrokerCheck.

7. Wealth advisors

Wealth managers and wealth advisors typically work with high-net-worth clients. They usually offer holistic financial planning services as well as investment guidance. Advisors specializing in wealth management can often help their clients with every area of their financial life, such as estate planning, tax help, charitable giving and insurance reviews. Wealth advisors may have high minimum investment requirements (think: in the millions).

8. Robo-advisors

Robo-advisors are inexpensive automated investment management services. They use algorithms to create and manage investment portfolios based on the customer’s goals. They are less expensive than traditional financial advisors but typically offer little human involvement and usually focus only on deciding what to buy and sell rather than on more comprehensive financial planning.

9. Financial therapists

Financial therapists combine behavioral therapy and financial coaching to help improve mindset. Financial therapists recognize that budgeting, saving and investing can trigger difficult emotions, and they can help with trauma and other negative feelings surrounding money.

» Ready to take the next step? Check out NerdWallet’s picks for the best financial advisors

Financial advisors vs. planners vs. consultants

SEC rules state that any financial professional or firm that engages in the business of providing advice to others or issuing securities reports or analysis for compensation is technically an "investment adviser" and must register with either the SEC (or their state, depending on the size of the advisor’s assets under management)^[0]

But other titles and forms of advice are largely unregulated, and that makes it the investor’s job to know what to look for. Here are four guidelines that will help you figure out which types of financial advisors to use and which to avoid.

1. Understand the difference between financial planners and advisors (and other titles).

Not everyone who uses an official-sounding title has specific training or SEC registration. Using the term "financial advisor," for example, doesn’t require having any specific credentials.

But some titles do have requirements.

• Investment advisors (including robo-advisor firms) and brokers are required to register with the SEC or a state authority^[0]

  U.S. Securities and Exchange Commission. SEC Adopts Reforms Relating to Investment Advisers Operating Exclusively Through the Internet. Accessed Apr 22, 2026.

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• People with CFP or ChFC designations have a fiduciary duty to clients, meaning they must act in the best interests of their clients rather than in their own interests or in the interests of their employers. 

• Asset managers and wealth managers frequently do work that also requires them to register with the SEC or state as advisors and/or fiduciaries, although those titles themselves are not legally regulated.

Keep in mind there is little to no regulatory oversight on who can use the other titles described above, such as "financial coach" and "financial therapist."

2. Know what kind of advice you need.

Identifying what you want from an advisor can go a long way in finding the right fit for you. For example,

• If you only want automated investment management, a low-cost service like a robo-advisor might be the best fit. (Learn more about how to choose a financial advisor.)

• If you want non-investment advice, such as estate planning, debt counseling or insurance planning, you may opt to work with a financial planner (including CFPs), consultant (including ChFCs), wealth manager or financial therapist. They tend to offer holistic financial advice. Many of the other titles described above, such as asset managers and robo-advisors, are generally only allowed to give investment advice.

• If you need tax help, look for an advisor who specializes in taxes and has a CPA license or other certification to match. 

3. Find a fee-only fiduciary.

Some financial advisors have a fiduciary duty to their clients, meaning they are obligated to act in their client’s best interest rather than their own. We prefer licensed, registered fiduciaries — preferably ones who are fee-only, which means the advisor is paid directly by you and not through commissions for selling certain investment or insurance products.

4. Vet your advisor.