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Financial Health

Different Types Of Financial Planners

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Types of financial planners

The type of financial planner that is best for you will depend on your needs, life stage and budget.

Robo-advisors

If you’re just starting out, a robo-advisor may be enough to meet your needs. Automation has enabled traditional firms like Vanguard and Fidelity, as well as online-only companies like Betterment and Wealthfront, to substantially lower the price of portfolio management. These companies are ideal if you need investment management, but not holistic financial planning.

Robo-advisors build and manage a portfolio of low-cost investments suited to your financial goal for a small fee — many top choices charge 0.25% or less of your account balance. The investment mix is determined by a computer algorithm and is automatically adjusted when needed. At the basic account level, you can start investing with $500 or even less.

The low-cost, easy-entry nature of robo-advisors reduces barriers to working toward your financial goals. That’s important because avoiding the market can starve your retirement. You can start with a robo-advisor and add a human advisor later on if needed.

How effective will this vaccine be in the general population?

Although there’s a strong protection against COVID-19 after receiving the vaccination, there’s still a chance that one could get the virus after being vaccinated.

The vaccine takes time to provide protection, and no vaccine is perfect.

The Pfizer vaccine is said to be 95 percent effective, according to evidence released by regulators. The Moderna vaccine appears to be about 94 percent effective.

But even after getting these vaccines, it may take several weeks for the body to start building immunity after the vaccination. This means that someone could get sick with the virus just before or even just after getting the vaccination.

Traditional, in-person financial planners

For those with complicated or ongoing planning needs, a traditional, in-person financial planner may be a better fit. A CFP can provide holistic, one-on-one advice for the most complex financial situations. The official CFP designation indicates that a provider has gone through a rigorous formal training and testing process.

A fee-only CFP typically charges by the hour (usually $200 to $400) or by the task (a flat $1,000 to $3,000 fee, for example). Some might charge based on the size of the investment portfolio they are managing for you; this is called an assets-under-management fee and is typically 1% of your portfolio balance per year. The initial consultation to discuss your needs and their services is usually free.

Before you enter a relationship, ask whether the person you’re considering is a fiduciary, a term that means they’re obligated to put the client’s best interests first.

Online financial planning services

There are several online planning services that combine computer-driven portfolio management with access to living, breathing financial planners. In many cases, you’ll get a dedicated financial planner and a comprehensive financial plan, but you’ll meet with that advisor via phone or video conference rather than in person. Online planning services like this typically charge more than a robo-advisor but less than a traditional financial planner.

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