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Do I Need an Accountant or Financial Advisor? Thumbnail

Do I Need an Accountant or Financial Advisor?

Honestly, dear reader, you might need both. You need accounting services for financial statements, tax preparation, and financial forecasting. You need a financial advisor for wealth management, investment insights, and strategic advice. 

But what you might really be asking is this: do you NEED these services, or can you do-it-yourself? That question depends on your unique personal finances, your knowledge of math and finance concepts,  and your plans for the future. Let’s unpack why and when you need to hire a financial professional, and how to choose between an accountant, financial advisor, or both when the time comes. 

Which is Better, Financial Advisor or Accountant?

This isn’t a competition: both can be necessary. However, these jobs are very different and you need to understand the difference to get the help which is right for you!. It will be easier to figure out with more explanation of what they do. 

What Does a Financial Advisor Do?

A financial advisor helps clients build their wealth. That requires understanding how to manage risks, while also listening to the individual about their goals. An experienced financial advisor should explore your risk tolerance  and recommend investments accordingly. Whether you want to manage your investments for your own retirement, to leave for your heirs, or to achieve other goals, there will be financial advisors who specialize and are licensed in your needs. 

What Do Accountants Do?

Accountants help clients create, review, and maintain financial records. This includes tax preparation, payroll recordkeeping, compliance reporting, financial statements, forecasts, risk assessments, and more. Some accountants also work as bookkeepers, helping keep tabs on the day-to-day financials, while others do not provide bookkeeping services. Accountants also come in many different specialties and with unique certifications. 

Can an Accountant Act as a Financial Advisor?

Accountants often give advice about how to reduce expenses and grow income. But that is not the same thing as the advice a financial advisor gives. Financial advisors provide investment advice with regards to securities, where an accountant is not registered or licensed to act within the regulatory guidelines set forth by the SEC.

CPAs may provide limited financial advice that is incidental to their accounting tasks. CPAs are not licensed or experienced to provide comprehensive financial advice when it comes to securities. If the accountant is giving such advice in every meeting–and getting paid–then they are crossing into the danger zone from the compliance perspective. Going so far as to tell the client to buy or sell certainly crosses over into the realm of financial advising. Giving clients advice about whether or not to invest in securities like stocks, mutual funds, or bonds over other options is also considered “investment advice” under the SEC’s rules. Although a good CPA will provide tax advice as it pertains to investments, it is definitely a win-win solution to have both on your financial team.

In order to provide such advice and remain in compliance, the CPA would also need to be a registered and licensed investment advisor. Depending on how many assets they have other management, some accountants may register as financial advisors with their state, while others register directly with the SEC.

How Much Money Should You Have Before Using a Financial Advisor?

Many advisors require a minimum of $100,000 in investable assets before they meet with a client. This is because they need a nest egg to invest and grow, and don’t want to waste your time or expenses on fees just to tell you there isn’t enough to invest. If you are trying to grow your wealth to this point, you could hire an accounting firm which also has certified investment advisors to help. (Hint hint, we’re talking about us.)

Trust Delta Wealth Advisors to Grow Your Future

Delta Wealth Advisors has structured our business to have both in-house accountants and financial advisors, because again, we know you probably need both. A financial advisor needs the analysis from the accountants to guide the right decisions, and the accountants need financial advisors to keep the money coming in! 

We address every angle of your financial picture, sparing you the stress of being in the middle communicating with your CPA one day and your wealth manager another. All our employees are committed to winning our clients trust and building a partnership through the years. This is a long-term relationship with long-term benefits and so we take our work very seriously. We fight every day to give our partners the best service and win them the financial edge…because we know their secure and happy futures depend on it. 

Wondering and worrying about your financial future? Schedule a call with Delta Wealth Advisors and put the work in our hands.