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Financial Consultant Defined

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Do you need help planning for your short-term or long-term financial goals? You might wonder exactly how to invest money that you may need 6 months — or even 30 years — down the road. You might also want to reduce debt or save for college and more. No matter your plans for the future, a financial consultant can support you. 

We’ve broken down exactly what a financial consultant does so you know whether you need one on your team to help you carry out your goals.

What is a Financial Consultant?

Financial consultant is an umbrella term for several different kinds of financial counseling — in fact, it’s another word for financial advisor.

 Consultants can:

  • Serve individual clients.
  • Focus on retail companies and businesses.
  • Work on budgets and tax strategies. 
  • Help clients invest in insurance, stocks, bonds or other types of investments.

The type of financial professional you work with will depend on your specific financial goals. 

Financial Consultant vs. Financial Advisor 

What’s the difference between financial consultant and financial advisor? Great question. Some sources point to a shift in the 1990s, when the term “financial consultant” morphed into “financial advisor.”

Others say that both roles are completely different — they diverge at the length of time spent with a client. Consultants are brought in for 1 specific issue during a period of time to offer advice. On the other hand, advisors work with you to achieve preset goals from the start of the relationship. An advisor may suggest bringing in a consultant for a situation-specific consultation during a rocky financial period. 

Regardless of which theory is correct, it’s most important to check your financial expert’s certifications. This will give you the best idea of his or her qualifications. 

What Certifications Does a Financial Consultant Have?

An expert’s specialty is determined by a combination of qualifications and experience. Here are a few common certifications you’ll see from a broad range of financial consultants: 

  • Certified financial planner (CFP): A certified financial planner will assess your entire financial profile from top to bottom and offer you a personalized plan for growing your money. Sitting for the exam requires a minimum of 3 years’ experience in the field and a bachelor’s degree. 
  • Chartered financial analyst (CFA): Finding a CFA is your best bet for success. This certification is one of the most difficult to gain thanks to its 3 exams that require mastery of 10 investment topics. The pass rate is below 50%. 
  • Chartered financial consultant (ChFC): This consultant focuses on budget planning and retirement savings. The certification test is the most comparable to the CFP, but it offers the opportunity to specialize in more niche topics. For example, you might need to find an expert in small business planning or divorce so you handle your money appropriately, and a ChFC could help you. 

Here’s a broad list of Benzinga’s top financial certifications. 

Aside from certifications, it’s also important to ask your financial consultant if he or she is a fiduciary. This means your consultant is legally obligated to put your best interests ahead of any personal gain as he or she invests your money. Working with a fiduciary guarantees you’ll be protected from day 1. For more information, check out Benzinga’s article on fiduciary financial advisors.

Personal Financial Consultant vs. Business Financial Consultant 

Do you need a personal financial consultant for yourself or your small business? A financial consultant can support either. The biggest difference between the 2 is the scale of your consultant’s activities and duties. 

A personal financial consultant might help you: 

A business financial consultant might help you:

  • Transfer your company to a different owner.
  • Predict and prepare your company for market shifts.
  • Locate and access fresh capital for new business endeavors.

Check your consultant’s resume to see where he or she has the most experience. Consultants’ specific certifications and specializations can help you find the right fit for your particular needs, whether it’s personal or entrepreneurial. 

How to Find a Financial Consultant 

Check your sources to manage your money. Here are a few suggestions: 

  • Check for referrals. Much of a financial consultant’s business comes via word of mouth. You want to know you’re meeting with an honest person. What better way to vet him or her than through a personal referral? Whether it be from friends, colleagues, family or an accountant or lawyer, referrals are a great way to make the first contact and see if you pair well with your potential financial consultant. 
  • Look up financial consultants through the Financial Planning Association (FPA). Whether you look for personal or business counseling, the FPA can help you locate a suitable advisor in your area. Go to onefpa.org or call 800-322-4237 for more information. 
  • Use SmartAsset’s free tool. SmartAsset can connect you with three financial consultants in your area and let you pick the one best suited for your situation.

What are Some Financial Consulting Firms?

There are thousands of financial consulting firms to choose from. However, here are some of the best-known firms for customer service and variety: 

  • Ameriprise
  • AXA Advisors
  • Capital Group Companies
  • Charles Schwab
  • Citigroup
  • Edward Jones
  • Fidelity Investments 
  • J.P. Morgan Asset Management
  • LPL Financial
  • Merrill
  • Morgan Stanley
  • Northwestern Mutual
  • PIMCO
  • Raymond James
  • RBC
  • Stifel Financial
  • UBS
  • Vanguard
  • Wells Fargo Advisors

Get the Best Financial Consultant for You

A financial consultant can offer lots of suggestions — but you’re the one who needs to feel confident in your investment choices. Don’t be afraid to ask questions! You’re paying your financial consultant for his or her services and expertise so you can continue to watch your money grow for years to come.

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