Susan Mallin, CIM, CFP - Investment Advisor, Toronto and the Greater Toronto Area
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© 2012 Susan Mallin, CIM, CFP
Investment Advisor,
Toronto and the Greater Toronto Area.

Finding an Advisor in Toronto and Ontario

You would think that finding an advisor in Toronto would be relatively easy considering that it is Canada's financial hub. Nonetheless, many people are confused about the differences between the various categories of advisors and, as a result, occasionally find their needs for financial advice mismatched with their advisor.

Here is my basic breakdown of the four main advisor titles in Toronto and across Ontario. I have also included resources that you can use to help protect yourself from unregulated advisors, at the bottom of this article.

Finding an advisor involves identifying the appropriate advisor category:

  1. Finding a financial advisor - The title financial advisor is usually reserved for advisors that work in a bank. Within the context of a bank, a financial advisor is limited in terms of the products that he or she can recommend and none are allowed to discuss life insurance, in any great detail. Banks organize financial advisors according to how much money they manage. Most financial advisors receive a salary as well as a bonus, which is tied to sales targets.
  2. Finding a financial security advisor - The title financial security advisor is usually reserved for advisors that work for insurance companies. Financial security advisors, typically, have very good knowledge of life insurance products. Over the years, financial security advisors have evolved from their sole focus on insurance. Today, many financial security advisors also have their Mutual Funds License.
  3. Finding a financial planner - Be a little cautious here. Apparently, almost anybody can call himself or herself a financial planner. That being said, many financial planners are specialists and, as such, they are extremely competent at various aspects of financial planning. Financial planners will often provide very detailed holistic financial plans for their high net worth clients. A financial planner normally charges an hourly rate and may or may not have the license to make investment recommendations. Some financial planners have their Mutual Funds License and, in those cases, additional fees may apply.
  4. Finding an investment advisor - The title investment advisor is usually reserved for advisors who adhere to industry standards, examinations and training. An investment advisor is licensed with a provincial securities commission. It is, therefore, permissible for an investment advisor to recommend bonds, mutual funds and stocks. I know many investment advisors in Toronto (as I am one of them) and, although each individual advisor may specialize in something specific, most are generalists and take a holistic approach to building wealth for their clients. Almost all investment advisors in Toronto (and throughout Canada) are paid a form of commission for their investment services. A number of investment advisors will also offer additional services such as retirement planning, estate planning and education planning, at no extra charge.

Finding an advisor involves identifying the right fit:

As you will be entrusting your advisor to manage your money, you will want to find someone that offers the right fit beyond the appropriate advisor category:

  • The complexity of your financial needs will dictate your advisor's required level of experience and credentials.
  • In the case of unusual circumstances, you may prefer to work with an advisor that offers specific specialties.
  • For most, an essential benefit to working with an advisor is that it eliminates the complicated and onerous lifelong task of navigating the financial world, alone. When finding an advisor, consider whether or not you can express yourself and feel heard. Take care to find an advisor that enables engaging conversations rather than making your eyes glaze over, as he or she speaks in industry terms.
  • In order to maximize benefit from this relationship, you should find an advisor you see yourself working with over the long term. I have read studies as to how working with an advisor delivers better results over the long term. As such, once all qualifications are met, it would help if you also liked the person

Finding an advisor involves protecting yourself from unregulated advisors:

The key to finding an advisor in Toronto, and anywhere in Canada, for that matter, is to do a background check on the advisor and his or her firm. Professional bodies regulate all investment and insurance firms in Toronto (and across Canada) that provide a forum for advisors to sell investment or insurance products. These regulators are responsible, among other things, for setting rules and regulations for the industry including compliance standards for licensed representatives. In basic terms, anybody who is giving financial advice and implementing investments on your behalf should work for a firm that is a member of a recognized regulatory body in your province and the individual advisor should be licensed to conduct the business they offer. To protect yourself, you should not make any exceptions to this.

If you are dealing with an advisor in a properly regulated firm, it will afford you comfort of knowing that the advisor and the firm are held to a higher ethical standard, are regulated and are qualified to provide you with investment advice.

Finding an advisor in Toronto, Ontario, Canada - Resources

If you want to conduct further research as part of your process of finding an advisor, here is a list of regulatory bodies and consumer protectionists in the Canadian financial industry:
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