16 Hire a Financial Advisor and 17 Build Wealth

What is the main difference between a financial planner and a financial advisor as described in the passage?

• Financial planners only give investment advice, while advisors create holistic plans.

• Financial planners help you come up with a comprehensive plan for your entire financial life, while financial advisors might be more limited to giving advice on investments.

• Financial advisors are not licensed, while planners are.

• Financial advisors only work with budgeting.

Fill in the blank: Financial planners are generally trained to help you come up with a comprehensive plan to help navigate your entire _________

• financial life

• work schedule

• diet plan

• travel itinerary

According to the diagram, both financial planners and financial advisors give you ________ advice.

• investment

• medical

• legal

• culinary

Which of the following is a responsibility of a financial planner according to the diagram?

• Holds specific types of investing licenses

• Helps with financial goals outside investing

• Only manages investments

• None of the above

A financial advisor is a broad term for someone who manages your money, investments, and other accounts.

• True

• False

Fill in the blank: A ______ is a person or organization that acts on behalf of another person to manage assets and is legally and ethically required to put their client’s best interests before their own.

• fiduciary

• beneficiary

• auditor

• shareholder

Fill in the blank: The ______ standard is a regulation that says a broker must make 'reasonable efforts to obtain information' on a client before making investment recommendations.

• suitability

• fiduciary

• disclosure

• prudence

What does it mean when advisors are independent?

• They can only recommend products from one company.

• They are free to recommend financial products from different companies.

• They are required to sell only Wells Fargo products.

• They are not allowed to recommend any products.

A brokerage firm only needs to abide by the ______ standard. (Fill in the blank)

• suitability

• fiduciary

• ethical

• prudent

A registered investment advisor (RIA) is legally required to act as a ______.

• fiduciary

• broker

• principal

• agent