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Stockbroker Vs. Financial Planner

by Marilyn Lindblad, studioD

Working in a position that deals with money can be exciting, emotionally satisfying and financially rewarding. These occupations include banking, investing, accounting, finance, stock trading and financial advising, among others. Although stockbrokers and financial planners both work with investments and securities, their responsibilities and duties are somewhat different.

Buying, Selling and Trading

Stockbrokers buy, sell and trade securities, such as stocks and bonds, and commodities, such as gold, oil and beef. Many work long hours in stressful environments. Some brokers work on the trading floor of a stock exchange, but most sit behind a computer screen and keyboard, trading online. They receive extensive on-the-job training from their employers about types of securities and different buying and selling methods.

Counseling and Advising

Financial planners help people understand their financial options and plan for the future. They meet one-on-one with their clients and offer expert advice in tax planning, investing and estate planning. Some planners also sell products such as insurance policies and annuities. One type of planner, a fee-only advisor, provides advice only and does not sell products. Financial planners must have analytical skills to choose the best solutions for their clients' needs and communication skills to explain complex financial concepts in simple, understandable terms. They work whenever their clients are available. That means they may spend nights and weekends meeting with clients and developing leads.

Education and Certification

Stockbrokers and financial planners have similar educational and certification requirements. Most entry-level positions require a bachelor's degree in finance, business, economics or another related field. An MBA is usually required to advance in both industries. Stockbrokers must pass an exam and maintain ongoing training to be licensed by the Financial Industry Regulatory Authority. They may also become certified as Chartered Financial Analysts by passing three exams and working in the field for four years. Similarly, financial planners can earn a certification from the Certified Financial Planner Board of Standards by having a bachelor's degree, passing an exam, completing three years of relevant work experience and agreeing to follow a code of ethics.

Differences Between the Two Professions

There are many similarities between stockbrokers and financial planners. Both occupations involve similar education and training. Some stockbrokers help their buyers make strategic plans for their money, and some financial planners sell securities to their clients. However, these professions are also significantly different. Certified financial planners are bound by a code of ethics that does not apply to stockbrokers. In addition, fee-based planners earn money for providing advice, while stockbrokers are compensated based on sales commissions.

About the Author

Marilyn Lindblad practices law on the west coast of the United States. She has been a freelance writer since 2007. Her work has appeared on various websites. Lindblad received her Juris Doctor from Lewis and Clark Law School.

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