How to Choose a Financial Advisor in Canada

financial advisor in canada

The financial advisor in Canada is complicated, and it’s no wonder why many people seek the guidance of a professional. But figuring out who to trust, and how much their services cost, can be difficult for Canadians.

The term “financial advisor” is a broad one, encompassing anyone who helps with your money—like a bank employee, stockbroker or insurance agent—and the rules around what qualifications are required to call yourself an adviser vary by province. Ontario, for example, has regulations in place requiring financial planners to be licensed and have specific credentials like education, exams and codes of conduct.

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Other designations include personal financial planner (PFP)—which focuses on comprehensive planning across six practice disciplines, including tax, estates, risk, investment and retirement—and registered financial planner (RFP). In addition, some financial advisors specialize in managing specific areas of your finances, such as investing or debt management, while others focus solely on providing advice on investment options, such as GICs, mutual funds, stocks and bonds.

It’s also important to understand the fees that are associated with working with a financial advisor, and how they differ from firm to firm. These can include commissions charged on transactions, flat or hourly fees based on the number of clients an advisor has, or management expense ratios, or MERs, for managed investments such as mutual funds that are paid to a portfolio manager rather than directly to the client. These fees can add up, eroding the growth of your savings and investments over time.