top of page
  • Writer's pictureStephen H Akin

Registered Investment Advisor Vs Stockbroker

If you are like many people you may not be confident in making financial and investment decisions on your own. Enter the investment professional.

There are two main categories of professionals who can help you: the Stockbroker and the Registered Investment Advisor.

They differ in two ways, A) their level of responsibility to you and B) how they get paid.

A stockbroker is an employee at a financial firm who is paid a commission based on what you invest. He/she is basically a sales person. The investment they sell you must be appropriate at the time of the recommendation but they have no further, on-going responsibility to you.

During the “know your client” conversations, the stockbroker learns many things about you and your financial needs, including

• How old are you?

• What is your investment time horizon?

• Is your investment intended for retirement, down payment on a home, your

child's future college expenses or something else?

• What is your profession?

• What is your annual salary?

Registered Investment Advisor, on the other hand, are fiduciaries, meaning your interests always come first. You will have a continuing relationship with your RIA. An RIA must register with the SEC or state securities regulator, depending upon the assets under management.

Financial Planners help individuals and corporations meet their short-and long-term financial goals. Services include asset allocation, estate planning, tax planning, retirement and more.

There are several methods by which you might pay an investment advisor, including a fixed fee, an hourly fee, or a percentage of the value of your assets they are managing.

It’s important to know what your options are when you select an individual to manage your finances. Asking these questions will help you find the right choice and make an informed decision.

bottom of page