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What is a Financial Advisor and Do You Need One? A Simple Explanation for Kids

What is a Financial Advisor & Do You Need One? Finance 101: Easy Peasy Finance for Kids & Beginners

Introduction to a Financial Advisor for Kids and Teens

This video explains the concept of a financial advisor in a simple, concise way for kids and beginners. It could be used by kids & teens to learn about financial advisors, or used as a money & personal finance resource by parents and teachers as part of a Financial Literacy course or K-12 curriculum.

What is a Financial Advisor and Do You Need One - A Simple Explanation for Kids Teens and Beginners
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Suitable for students from grade levels:

  • Kindergarten
  • Elementary School
  • Middle School
  • High School

The topics covered are:


What is a financial advisor?

Financial Advisor for Kids Teens and Beginners
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A financial advisor is a qualified professional who gives advice and guidance on financial matters to their clients.

The term “financial advisor” is very broad, and can describe many different types of people including brokers, insurance agents, tax professionals, estate planners, bankers, investment managers, and financial planners as long as they provide financial advice.

Registered financial advisors need to have a proper license before they can take on clients.

What does a financial advisor offer advice on?

Depending on their area of expertise, financial advisors can offer advice on money matters ranging across budgeting, saving, investing, retirement planning, tax planning, estate planning, and more.

Ideally all financial advisors should act in the best interest of their clients, also known as fiduciary responsibility, although this is enforced only for Registered Investment Advisors.

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Are financial advisors expensive? How much do they charge?

There are many different fee structures financial advisors use. Each fee structure is suitable for different situations and depending on what you choose, you may get investment management advice, a comprehensive financial plan, continuous plan monitoring or a combination of these services.

To give you an idea about the average fees, the amount charged can be a percentage of assets under management – from 0.25 to 1%, a flat yearly fee – from two to eight thousand dollars, an hourly fee – from two to four hundred dollars per hour, or a one-time Financial Plan fee between 1,000 and 3,000 dollars for creating a financial plan.

Do I need a financial advisor?

Financial Advisor - Fees Charges and Should You Hire One
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If you are disciplined when it comes to managing your money and are comfortable making decisions about taxes, estate planning, retirement, and investing; then you may not need a financial advisor.

But if you are not disciplined or need help with these topics, then you should consider hiring a financial advisor.

However, before hiring a financial advisor, it’s best to educate yourself about these topics so you can have an intelligent conversation with the financial advisor and ask the right questions.

Make sure to only hire a financial advisor with expertise in areas where you need help. Do not blindly hire a full service advisor if you are not going to use all their services, because they can be significantly more expensive.


Download Transcript: Ideal for Use by Teachers in their Lesson Plan to Teach Kids & Teens


What is a Financial Advisor and Do You Need One
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