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Registered Investment Advisor vs. Broker: What’s the Difference?

December 22, 2017

Wondering whether you should consult a registered investment advisor for your investment needs or a broker? Depends on your individual portfolio.

Wondering who you should consult for your investment needs? You have a few options...

The benefits of holistic planning

One thing to pay attention to when selecting an advisor for your investment needs is whether or not this person is a holistic wealth management advisor.

What exactly does holistic planning entail? Well, essentially it’s a money management philosophy that digs beneath the surface to uncover all areas in your financial situation that need to be considered for successful retirement planning. In short, holistic wealth management looks at more than just the numbers.

Often times, advisors will zero in on only one aspect of your financial circumstances. A holistic wealth management advisor, on the other hand encompasses all aspects of your financial circumstances (ex. your debt, your investment portfolio, insurance protection etc.) to deliver the most helpful advice. Holistic wealth management is governed by traditional solutions rather than synthetic or hybrid products that can at times be even difficult for an investment advisor to understand.

A comprehensive financial plan needs to include both the different components of your financial circumstances as well as your personal goals and a strategy and solution to accomplish them.

So....who should I hire?

Registered Investment Advisor?

RIAs follow the fiduciary standard- This requires that an advisor place the client’s interest first. This is the standard that is enforced by the Securities Exchange Commission (SEC). RIAs manage relationships from a holistic perspective, i.e. they factor in multiple financial topics before providing any advice.


  • Clients have direct access to the “decision maker.”
  • Investments and allocations decisions are made in a coordinated effort between advisor & client. RIAs must give full disclosure to the client.


Brokers, on the other hand follow the suitability standard. The suitability standard requires that a broker makes recommendations that are “suitable” based on a client’s specific situation. The key here is that this standard does not necessarily require the recommendation given to be in the client’s best interest. Brokers, or registered representatives, are held to this suitability standard which is enforced through a self-regulatory organization called the Financial Industry Regulatory Authority (FINRA).

Long story short, if you’re looking for someone to help you build, manage, and preserve your wealth, a broker might not be able to provide you everything you need to grow. RIAs are likely to be experienced in many different areas, and can consult bankers, trust officers, attorneys, and other advisors when a problem arises of which they are not familiar.

Questions? Contact us.

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