Calculating Risk and Investing Wisely

Registered Investment Advisor: Why You Need It and How to Hire

Retaining a registered investment advisor is the best way to start your journey towards financial independence. Not only do they give you intelligent suggestions on how to improve your financial standing, but they also do it efficiently, taking your doubts and apprehensions into account and providing you with the best route to achieve your financial goals.

However, finding an advisor you can trust with your hard earned money can be challenging. This article will give you better insight and serve as your quick guide on finding the right registered investment advisor for you.

Discussing with a Registered Investment Advisor

What is a Registered Investment Advisor?

A registered investment advisor (RIA) is a professional who makes investment recommendations and does comprehensive financial planning.

  • RIAs have fiduciary obligations to their clients

This obligation means that RIAs must always act in their clients' best interests. They are legally obligated to avoid conflicts of interest and fully disclose any that exist.

  • RIAs register with state securities regulators or the Securities and Exchange Commission (SEC)

RIAs are registered with either (or both) the Securities and Exchange Commission and state regulatory authorities. An easy way to check out an investment professional is to use the free search tool available on, which will direct you to the SEC’s Investment Adviser Public Disclosure website (IAPD website). You can also visit the IAPD website directly, FINRA’s BrokerCheck program, and/or your state securities regulator. Both the IAPD and BrokerCheck databases will automatically redirect you to the other, if necessary. The searches are free and investment professionals or firms are not made aware of searches.

  • RIAs offer more than financial planning

RIAs can provide advice on many topics related to your financial life, like retirement planning, tax planning, estate planning and insurance issues.

Here are a few other things that RIAs can do:

  • Meet with you to discuss your current financial condition and long-term objectives
  • Create a comprehensive strategy that considers your main financial concerns like saving for college education, insurance, and retirement planning
  • Give guidance about unforeseen financial challenges
  • Create investment accounts and make investment recommendations

Why Do You Need a Registered Investment Advisor?

Hiring an RIA is a critical first step in your retirement planning.

1. They can help in assessing your financial goals

RIAs are experts at helping you formalize financial goals and preparing a plan to achieve them.

2. They can make a comprehensive plan for your financial concerns

Your assets, liabilities, taxes, and income are all interconnected. A financial advisor will create a comprehensive financial plan, that will include the many different components of your financial life.

3. They can help determine your risk and make investment recommendations

Your financial advisor will recommend an asset allocation (the division of your portfolio between stocks, bonds and cash) consistent with your need to take risk and your ability to tolerate that risk.  

How to Choose a Registered Financial Advisor?

Here are some tips for choosing an RIA.

1. Get recommendations

Accountants, lawyers and other professionals are often familiar with RIAs in their geographic area.  Ask them for recommendations.  

2. Check their credentials

Credentials for financial advisors can be confusing.  Some require years of study.  Others may reflect only a week-end course.  Here are examples of credentials that reflect intensive education and commitment:

  • Ph.D in Finance
  • Certified Financial Analyst (CFA®)
  • Certified Public Accountant (CPA)
  • Certified Financial Planner (CFP®)
  • Masters of Business Administration (MBA).

There are many fine RIAs who don’t have these qualifications, but this list is a helpful starting point.

3. Choose which financial advisor services you need

Your financial manager's services today may not be the same as what you will require in a few years. Therefore, evaluating the range of services your wealth manager provides is crucial. As your financial situation develops and evolves, an advisory firm that offers a broad range of wealth management capabilities will be better prepared to fulfill your needs.

4. Understand how financial advisors get paid

The fees charged by your RIA should be fully and transparently disclosed.

Prepare Your Future with a Registered Investment Advisor

The earlier you retain a registered investment advisor, the better you will be prepared for retirement.

Professionals at Daner Wealth have the expertise to assist you in reaching your long-term financial goals. Contact us today to get started!

Learn everything you need to know about hiring a registered investment advisor and how they can help you prepare for your future.


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