Find the Best Financial Advisors in Tucson, AZ

Choosing a financial advisor in Tucson

Many people seek financial advisory services to deal with changes in their lives, such as marriage, divorce or retirement. However, money advisors work with clients at any stage of life.

Financial advisors use their expertise in asset management to assist you with investments, taxes and saving. Money advisors also save you time, so you can spend more time doing activities you enjoy instead of balancing your accounts.

Many retirement and financial planners in Tucson work with clients that have any amount of assets, while some only advise clients with a high net worth and an arbitrary minimum investment.

Types of financial advisors

There are many types of financial advisors in Tucson to help you manage your money. Two major distinctions separate these advisors and the first of which is between robo-advisors and human advisors.

• Robo-advisors. Also known as online advisors, robo-advisors are digital platforms that provide automated financial planning services and asset management with little to no human supervision. They are cheaper than traditional advisors but less precise.
• Human advisors. These traditional advisors work on an ongoing or temporary basis to manage client finances, including investing and estate planning, based on their education, experience and specific knowledge of the client. These advisors are more expensive but offer a level of custom service robo-advisors can’t match.

The second distinction that separates all financial advisors depends on the standard the advisor maintains.

• Fiduciary financial advisors. This type of financial planner abides by the fiduciary standard, which is a legal and ethical obligation to act solely in their client’s best interest.
• Non-fiduciary advisors. These advisors maintain the suitability standard, which only requires that their recommendations are beneficial and fit their client’s needs. This relaxed standard opens the door for conflicts of interest and a loss of potential earnings compared to a fiduciary, even if the advisor means well.

What is the cost of a financial advisor in Tucson?

The cost of a financial advisor in Tucson varies both in the amount you pay and how you pay it. Fee-only advisors, for example, average $150 to $300 per hour, whereas commission-based advisors receive 3 - 6 percent of the client’s investment transactions. Other advisors might charge a flat fee for one-off services or charge a fee of 1 - 2 percent of your account for long-term asset management.

Financial advisors refer to themselves as fee-only if they make their profits exclusively from client fees and fee-based if they accept both fees and commission. There’s a risk that advisors making any amount of commission will make unnecessary trades and purchases to pad their bottom line. This conflict of interest is why many people prefer fee-only advisors for asset management.

Before you settle on an advisor, determine what their compensation structure is and ask about any transaction fees you should be aware of so you know what to expect when you receive your bill.

What qualifications should a financial advisor have?

There are four qualifications that your Tucson financial advisors should have:

• College education, ideally an MBA
• Proper licensing and registration
• Professional designations, like Certified Financial Planner status
• Experience and positive reviews

Typically, these qualifications are available on their firm’s website, but it’s worth verifying your advisor’s credentials through the Securities and Exchange Commission or the Financial Industry Regulatory Authority’s BrokerCheck.

After you have checked their credentials, ask a few questions to decide if you are hiring the right financial advisor in Tucson:

• How do you make money?
• Are you a fiduciary?
• How do you communicate with clients?
• What other services do you provide?
• What is your investment philosophy?
• What investment benchmarks do you use?
• What are your regulatory controls?

It’s essential that you do your due diligence and research your financial advisor to make sure they’re legitimate. Be wary of exaggerated asset management claims or reports of market-beating performance. The SEC has online resources if you suspect that a fake advisor is targeting you.