Different Types of Financial Professionals

Last updated: April 13, 2016

There Are Four Common Types of People Who Will Help You Manage Your Money:

1. Brokers/Registered Representatives

A broker or a brokerage firm helps you buy and sell securities.

All brokers and brokerage firms doing business in Kansas must register with the U.S. Securities and Exchange Commission, FINRA, and the Kansas Securities Commissioner.

The securities products a broker can sell depends upon the licenses they hold.

  • Brokers come in two main varieties: full-service brokers and discount brokers.

    • Discount brokers leave you with most of the investment responsibilities.

      • They act merely as an access to securities. You tell them what to buy or sell and they do it.

    • But, full-service brokers can provide you with investment research and handle all types of financial transactions.

      • They can handle your investments for you, so you don't have to think about them.

    • Think about it like working on your car yourself versus taking it to a mechanic.

  • Today online sources of investment have begun to reduce the role of the broker of old. The general public now has much more access to trading and investment information.
  • Remember, a broker is not legally required to act in your best interest.

2. Registered Investment Advisers

These are also called asset managers, investment counselors, investment managers, portfolio managers, or wealth managers.

An investment adviser’s job is to manage and invest your money on your behalf.

  • They can offer investment advice and manage your investment portfolio.

  • In other words, they do your investment homework for you.

  • Unlike a broker, investment advisers must act in your best interest.

An investment adviser firm or representative must register with the Kansas Securities Commissioner or SEC.

  • Investment advisers are often also brokers: that way they can sell and buy securities.

3. Financial Planners

Financial planners help you manage your money outside of just investing.  Financial planners help you generally understand and manage your money.

  • They often have an area of finances that they specialize in or a people group they work with.

Financial planners, acting as financial planners, may not need government regulation or certification if they are not providing services as described under 1 and 2 above.

There are, however, several organizations that self-regulate, like the Certified Financial Planner Board or The American College of Financial Services.

4. Certified Public Accountants (CPAs)

Many CPAs provide tax services and most CPA firms perform public accounting and independent audit services. Some are trained to provide financial planning, and some register as investment advisers.

  • CPA's must pass a comprehensive national examination. But they may also obtain additional educational and PFS (Personal Financial Specialist) credentials to provide financial planning services.

Professional Designations Are Numerous.

Are you confused about the licenses a financial professional has? If they have letters behind their name (e.g. Jane Smith APMA GFS), learn what they mean here.

*The information on this page is credited to IPT and Kiplinger. Their original materials are made available on the Kansas Securities Commissioner's website.

This article is published on KansasMoney.gov. Find more information by contacting these state agencies: