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12 Types of Services Provided by Financial Advisors

03/20/2023 - Effective Saving, Planning for Retirement

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Most people have some emotional connection to their money or the things they buy with it. This emotional connection can be a primary reason why we may make poor financial decisions. A professional financial advisor takes the emotion out of the equation by giving objective advice based on knowledge and training. Learn the types of services available before attempting to hire a financial advisor.

12 Types of Services Provided by Financial Advisors

As you go through life, there are financial decisions you will make that might be made more easily with the guidance of a professional. Whether you are trying to lower your debt load or want to start planning for some long-term goals, you could benefit from the services of a financial advisor. Here is a list of the types of services a financial advisor could provide for you.

1. Investment Management

The basics of investment management include buying and selling financial assets and other investments, but it is more than that. Managing your investments involves understanding your short- and long-term goals and using that information to make thoughtful investing decisions. A financial advisor can provide the data necessary to help you diversify your investment portfolio to match your desired level of risk and meet your financial goals.

2. Budgeting

Creating a budget is an important aspect of managing your finances. Budgeting gives you a guide to how much money you can spend and how much you should save each month. Following a budget will help you reach your short- and long-term financial goals. A financial advisor can help you outline the action steps to take to set up and maintain a budget that works for you.

3. Debt Management

Most people borrow money for large purchases like a home or a vehicle. Sometimes a medical bill or home repair can unexpectedly add to your debt load. A professional debt management plan helps you pay off that debt in the most financially advantageous way possible. A financial advisor can help you analyze your debt, prioritize a debt repayment strategy, provide options for debt restructuring, and outline a holistic plan to better manage debt and meet your future financial goals.

4. Cash Flow Analysis

Usually applied to business finances, cash flow analysis helps you balance money coming in with expenditures and savings plans. Personal cash flow analysis can tell you when you can afford to buy a new car or how much money you can add to your savings each month without running short for necessary expenses. A financial advisor can help you clearly see where you spend your money and then apply that insight to help you understand your financial well-being and how to improve it.

5. Risk Management and Insurance

Risk, when not managed properly, can be very expensive. Risk management services identify potential risks to your home, your vehicle, and your family, and they help you put the right insurance policies in place to mitigate those risks. A financial advisor can help you develop a strategy to protect your earning power and reduce losses when unexpected things happen.

6. Long-Term Care Planning

What would happen if you become disabled or develop a chronic illness and cannot take care of yourself? One of the largest expenses you could face later in life is long-term care. With the right plan in place, you can have peace of mind knowing that you will have the care you need if that day ever comes. A financial advisor can help you understand the different options available to you for long-term care planning and how those options can prepare you and your family to manage the future costs of aging.

7. Tax Planning

One key to investment success is developing a tax efficient strategy – one that minimizes the amount of taxes you have to pay on the money your investments earn. Reducing your taxes leaves more money to contribute to your investments. A financial advisor can help you use charitable giving and investment strategies to minimize the amount you must pay in taxes, and they can show you how to withdraw your money in retirement in a way that also minimizes your tax burden.

8. College Planning

Some people begin to make a plan for paying college tuition as soon as their child is born.. Even if you didn’t start early, college planning can help you put your child through college without facing unexpectedly large expenditures. A financial advisor can guide you in understanding the best ways to save for future college costs and how to fund potential gaps, explain how to reduce out-of-pocket college costs, and advise you on eligibility for financial aid and grants.

9. Retirement Planning

Making sure you have enough money to live on after you retire is an important part of financial planning. Planning and saving for retirement usually begin early in your career, but as retirement day gets closer, you’ll want to review and possibly revise the plan. If you didn’t start early, it’s not too late to plan for a comfortable retirement. A financial advisor can help you quantify and prioritize retirement goals, make a plan to accumulate and invest your money, explain how to use that money in retirement so that it will last, and create strategies to reduce the effect of taxes on retirement savings.

10. Estate Planning

Making decisions about how you will be taken care of if you become incapacitated and what will happen to your assets when you die are essential parts of your total wealth strategy. The estate planning process involves creating financial and legal documents and can begin when you are young. A financial advisor can help you create a robust estate plan and regularly review that plan to ensure that it reflects your wishes and goals specific to how you want your wealth transferred.

11. Charitable Planning

Charitable planning services help you make educated decisions about how to support the causes that are important to you. With the right plan in place, your money can go further to help the organizations whose missions are aligned with your values. A financial advisor can help you define your charitable giving goals and incorporate them into your financial plan. They can also advise you in appropriate ways to maximize your giving and tax deductions.

12. Business Succession Planning

Similar to estate planning, business succession planning involves making decisions about what will happen to your business if you are no longer able to work or when you decide to retire. If your business is a partnership, you will want to go through the succession planning process together. A financial advisor can help you and your partners understand the important components in business succession planning, determine the value of the business, create shareholder agreements, establish a compensation structure for successors, outline transition options, and much more.

Working with a financial advisor can be a smart way to protecting your finances. The key is finding the right financial advisor for your situation; you may end up engaging different advisors at different stages of your life. Try contacting your financial institution for recommendations.

Content is for informational purposes only and is not intended to provide legal or financial advice. The views and opinions expressed do not necessarily represent the views and opinions of WesBanco.

While we hope you find this content useful, it is only intended to serve as a starting point. Your next step is to speak with a qualified, licensed professional who can provide advice tailored to your individual circumstances. Nothing in this article, nor in any associated resources, should be construed as financial or legal advice. Furthermore, while we have made good faith efforts to ensure that the information presented was correct as of the date the content was prepared, we are unable to guarantee that it remains accurate today.

Neither Strategy Academy nor its sponsoring partners make any warranties or representations as to the accuracy, applicability, completeness, or suitability for any particular purpose of the information contained herein. Strategy Academy and its sponsoring partners expressly disclaim any liability arising from the use or misuse of these materials and, by visiting this site, you agree to release Strategy Academy and its sponsoring partners from any such liability. Do not rely upon the information provided in this content when making decisions regarding financial or legal matters without first consulting with a qualified, licensed professional.

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