There is a big difference between investment advisors vs financial advisors. The primary difference is one of fiduciary. In general, an investment advisor has a fiduciary responsibility to his or her clients. As an investment advisor, this means you are expected to keep the best interest of your client at the forefront, and not your own gain you may receive from the business. If there is a conflict of interest, you are expected to disclose it fully. Examples of this occur when a particular investment may be riskier for a client, but more lucrative to you, as the investment advisor. In these cases, the investment advisor would be expected to adequately describe the risk, and state that they stand considerable gain from the sale of the investment, so as not to persuade a client in their own best interest.

Further, investment advisors generally are held to a higher standard than financial advisors, and are registered under the Investment Advisers Act of 1940. You may read more about registering as an investment advisor with the SEC here.

Financial advisors, on the other hand, may be licensed to sell securities, but they are not held to as high a standard as investment advisors. In some respects, a financial advisor is a salesperson who usually represents a company offering a variety of insurance products to help people plan for retirement, a college fund for children, long-term care, long-term disability, life insurance, or various types of insurance. Financial advisors provide financial planning through assessment of income, investments and expenses of an individual or family. Based on this assessment, a financial advisor offers products and services to take them where they want to go in 10, 15, or 20 years down the road. Financial advisors are usually very personable and good at talking to people. Most financial advisors are self-employed and make their connections through referrals and word-of-mouth.

When comparing investment advisors vs financial advisors, keep in mind that the job is what you make of it. There are plenty of highly skilled financial advisors who take their job and their duty to their clients very seriously, just as there are unscrupulous investment advisors. If you are interested in financial planning or investment management, you should consider earning the designation of Certified Financial Planner (CFP), Certified Financial Analyst (CFA), and/or Certified Investment Management Analyst (CIMA), in addition to getting one of these business degrees online .

Interested in learning more? Read about how to become an investment banker. or how to become a financial advisor. or use the DegreeTree School Finder to find the right online school and program to match your needs.

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