Clients sign paperwork in front of their financial professional

The Different Roles of Financial Professionals in Your Life

To keep your financial journey pointed in the right direction, it takes an entire team of rockstars working on your behalf. Learn which types of financial professionals you should have in your corner, the different roles they play, and the qualifications to look for.

Published by Motley Fool Wealth Management Tue, May 14, 2024

read time 4 min read

Book a call with one of our experienced Wealth Advisors

• Learn about unique investment solutions
• Increase the potential to obtain your financial goals

When you hear the term “financial professional,” what comes to mind? Most people might associate it with a financial advisor or accountant. In reality, you’ll likely come into contact with a whole variety of financial professionals throughout your lifetime — each serving a specific and important role in your financial journey. 

Let’s take a look at some of the most common professionals who could play on your financial “team” now and in the future.

Financial Advisor

A financial advisor is often compared to a quarterback since they typically coordinate and communicate with other professionals you’ve hired onto your financial team. A financial advisor is a unique player though, as they’re the only professional who will have a full, birds-eye view of your financial picture. 

Your financial advisor can help you identify your short- and long-term goals (such as home-buying, paying for college, or saving for retirement) and develop a tailored financial plan that aligns all aspects of your wealth with those goals.

When interviewing potential financial advisors to work with, you may want to ask if they’re held to a fiduciary standard of care. That means they are required to work in your best interest by putting your needs above their own. Advisors who act as fiduciaries must avoid (and disclose) conflicts of interest, like receiving commissions or kickbacks.

Education and Certifications: Most financial advisors have a Bachelor’s degree at minimum, though there is no specific degree or education requirement to become an advisor. They are, however, required to pass certain exams by the Financial Industry Regulatory Authority (FINRA). There are many optional certifications and designations advisors may pursue, including the Certified Financial Planner™ (CFP®) designation, Chartered Financial Analyst® (CFA®), Retirement Income Certified Professional® (RICP®), and more.

Insurance Agent

Insurance is a broad topic, with policies to cover just about every aspect of your life — home, car, health, life, income, and the list goes on. While a financial advisor provides ongoing guidance based on your goals and needs, your work with an insurance agent may be more transactional by nature since you’re purchasing a policy, as opposed to obtaining advice.

Even if you purchase coverage online, you still may need to communicate with an insurance agent to review policy offerings, provide additional information, or discuss a claim.

Some financial advisors do offer insurance policies to their clients when the situation warrants it, but typically this is limited to things like life insurance, long-term care, and disability insurance.

It may be helpful to keep in mind that not all insurance agents are fiduciaries, meaning they aren’t obligated to suggest policies that are necessarily in your best interest. They are, however, held to the “suitability standard,” meaning the recommendation must be suitable when they make it. In some cases, agents may be incentivized by large commissions or bonuses to offer policies that are suitable but may not be optimal for the policyholder. For that reason, you may want to work with a fiduciary financial advisor first to review your options before approaching an agent to purchase the policies.

Education and Certifications: Insurance agents must have at least a high school diploma or GED, but a college degree is not required. Agents need to obtain an insurance license from the state they operate in, which typically involves courses and a licensing exam.

Tax Professional

A tax professional, as you can likely deduce, helps address just about anything and everything relating to your tax obligations.

Beyond preparing and filing your tax return, an accountant or other tax professional can help with a business’s bookkeeping, conduct audits, consult on tax planning strategies, and more. If you’re preparing your estate plan, for example, your accountant or other tax professional can help you understand the tax liability involved in certain transfer strategies (like estate or inheritance tax). 

If you’re a business owner, you may also work with a bookkeeper, who can help create your profit and loss statements, pay bills, process payroll, and more.

Education and Certifications: The primary certification for tax professionals is the Certified Public Accountant (CPA) designation. To obtain this designation, tax professionals must meet the educational requirements of their state, as well as pass a CPA examination.

Real Estate Agent

If you’ve ever bought or sold a house, you’ve likely worked with a real estate agent. They can help you view homes, appraise your own, list it on the market, negotiate, and complete the final sale. Your real estate agent can also connect you with other homebuying professionals, like mortgage lenders, appraisers, lawyers, and even contractors or handypeople. 

If you’re interested in diversifying your portfolio with real estate, an agent can help you find potential investment properties as well. 

Keep in mind as you’re working with a real estate agent that they are financially incentivized to help you buy or sell your home, as they’ll earn a percentage of the sale price — and they have no fiduciary or suitability standards to uphold. However, due to changes in the industry, you may be able to negotiate lower commissions.

If you’re trying to understand how homebuying will fit into your financial picture (i.e. “How much house can I afford?”), you may want to talk to your advisor first. 

Education and Certifications: Requirements vary by state, but real estate agents typically must complete pre-licensing courses and pass an exam before applying for their real estate license. 

Mortgage Broker

If you need to obtain a mortgage during the homebuying process, a mortgage broker can work as a liaison between you (the homebuyer) and the lending company.

In some cases, the mortgage broker may work for an independent mortgage company, meaning they have the flexibility to help you shop around to find the best rate or terms. If they aren’t independent, then they can only offer you the terms and rates provided by their employer. They can also collect all necessary documents and information from you and give you tips to increase your odds of getting approved.

If you have questions about applying for a mortgage, the approval process, or what your monthly payment will likely look like, a mortgage broker can help answer these questions.

Education and Certifications: Education requirements will vary by employer, though many mortgage brokers have a finance-related degree, such as accounting. To become a broker, an individual must pass the SAFE Mortgage Loan Originator Test after completing a prelicensing course.

Estate Attorney

Also called an estate planning attorney, this professional can work with your advisor and accountant to create, update, and oversee your estate plan. They can help prepare critical estate planning documents including your will, power of attorney, healthcare directive, and more. 

Estate attorneys are good resources for addressing any estate planning-related questions like:

  • How can I avoid the probate process?
  • Should I establish a trust?
  • Are there tax-efficient ways to transfer property to my kids while I’m still alive?
  • Who should I make the executor of my estate? What about my beneficiaries?
  • What estate planning documents am I forgetting about?

While a financial advisor can help you (and your surviving loved ones) with many of the financial aspects of estate planning, an estate attorney has the legal expertise needed to craft and file legally binding documents that can dictate your final wishes after your passing. 

Education and Certifications: While there isn’t a specific undergraduate degree, most attorneys obtain their Bachelor’s degree in legal studies, tax, accounting, finance, or another related field. They must then be licensed to practice law in their state. There are some certificates relating to estate planning, such as the Accredited Estate Planner (AEP) designation and Chartered Trust and Estate Planner (CTEP) designation.

Human Resources Professional

If your employer offers benefits (health insurance, 401(k), disability insurance, etc.), you likely have access to a human resources person or team. While you may not need to speak with them often, it’s important to remember that they’re available to answer questions about your benefits.

Remember, a human resources professional can provide you with facts and answer questions about your benefits, but they can’t help you make decisions about your finances. For example, they can tell you how much your employer matches your 401(k) contributions, but they won’t tell you how much you should contribute — that’s a decision your financial advisor can help with.

Education and Certifications: A degree in human resources is typically a minimum requirement for HR positions at a company. Additional certifications include the Associate Professional in Human Resources (aPHR), Professional in Human Resources (PHR), and Certified Staffing Professional.

Addressing Every Aspect of Your Financial Life

As you can see, it takes an entire team of knowledgeable professionals to keep your financial journey moving in the right direction. But we believe at the center of that team should be your financial advisor, as they strive for total alignment in every facet of your wealth — from insurance coverage to homebuying, estate planning, and more.

Back to Insights home
sign up today

Like what you're reading?

Join the thousands of readers getting stories like this delivered straight to their inbox every Thursday — for free. Give it a spin, enter your email to sign up.

Next steps to consider

Create your Investor Profile

Create your Investor Profile

Let's see what we'd recommend for you. Create your Investor Profile online right now — for free. It's secure and only takes 10 minutes.

Create your profile
Schedule a call

Talk to a Wealth Advisor

Schedule a 30-minute call with one of our Wealth Advisors and get a financial roadmap at no cost or obligation.

Pick a time
6 Sources of Retirement Income

Download our latest special report

6 Sources of Retirement Income: Must-read tips and tricks we believe all retirees should know. Download your copy today – for free.

Get your copy