A financial advisor helps clients manage their finances. The work covers investments, retirement planning, tax strategy, insurance, and estate planning. Advisors meet with clients, assess their goals, and recommend products or strategies. Some manage money directly. Others provide advice only. The field is broad, and the quality varies widely.

Compensation models differ. Fee-only advisors charge a flat fee, an hourly rate, or a percentage of assets under management. They do not earn commissions on products they sell. Fee-based advisors combine fees with commissions. Commission-based advisors earn money when they sell financial products. The model matters because it shapes incentives. A commission-based advisor may be tempted to recommend products that pay well rather than those that fit the client.

Credentials also vary. The Certified Financial Planner designation requires coursework, an exam, and experience. Fiduciary advisors are legally required to act in the client's best interest. Others hold to a suitability standard, which is weaker. Choosing an advisor means checking credentials, compensation, and disciplinary history. Regulators publish this information. A good advisor is worth the cost. A bad one can cost far more than the fee. The relationship is built on trust, and trust must be earned.

Common credentials

• CFP: Certified Financial Planner
• CFA: Chartered Financial Analyst
• CPA: Certified Public Accountant
• ChFC: Chartered Financial Consultant
• Fiduciary designation