What is a CPA vs. a financial advisor?

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What is a CPA?

A certified public accountant (CPA) has a license to practice accounting and auditing-related services in their state. CPAs can do what non-licensed accountants do, such as prepare tax returns and help with internal audits for businesses. However, because they have licenses, they're legally allowed to complete other tasks, like auditing a public company and representing clients before the IRS.

A CPA works with individuals, accounting firms, public entities, or private companies. These professionals can be employed by a firm or company or work as independent contractors with multiple individuals or companies as clients.

Licensing and credentials

CPA licensure requirements vary by state, but generally include:

• A bachelor's degree or a total of 150 credit hours from an accredited college or university
• One or two years of professional experience
• Passing scores on all four sections of the Uniform CPA Examination
• Passing score on an ethics exam

In 2025, several states began passing laws with additional pathways toward licensure. For example, Pennsylvania and South Carolina now allow candidates to have just 120 credits if they complete two years of professional experience rather than one.

Typical CPA services

CPAs and firms may focus on one or more types of financial services, but their offerings typically fall into one of the following categories:

• Accounting: Accounting services might include bookkeeping, financial statement preparation, and income and expense tracking.
• Advising: CPAs can consult businesses on their budgets, financial compliance, and business growth strategies.
• Auditing: Audits ensure the accuracy and compliance of financial records and procedures.
• Tax: CPAs can take over all tax services for an individual or company, including preparing and filing tax returns and monitoring tax compliance throughout the year.

Self-employed CPAs may charge clients for these services hourly or on a project basis. Meanwhile, accounting firms and businesses tend to pay CPAs annual salaries to provide these services.

What is a financial advisor?

Financial advisors give personalized financial advice to individuals and businesses. These professionals usually have deep knowledge of several financial areas, including retirement, estate, and tax planning.

An advisor first learns a client's financial goals, risk tolerance, and time expectations before building a customized plan. The plan may include insurance coverage strategies or cash flow management suggestions, for example. Regular reviews ensure that the plan continues to align with the client's goals as their life and priorities change. Financial advisors also give clients financial education and market perspective.

Types of financial advisors

Financial advisors can take on different roles and specialties. Some of the most common types of financial advisors include:

• Behavioral financial advisor: A BFA uses behavioral science to help clients recognize and manage the emotions that influence their money decisions.
• Certified financial planner: A CFP completes training and a financial certification exam to offer comprehensive financial services based on strict ethical standards.
• Investment advisor: Investment advisors offer guidance on securities and may directly manage client portfolios.
• Personal financial advisor: Personal financial advisors work with individuals, assessing their financial needs and overseeing their investments, taxes, insurance, and retirement planning.
• Retirement financial advisor: Retirement-focused advisors recommend savings strategies and income and investment plans that adjust as clients near retirement.
• Wealth management advisor: Wealth management advisors offer holistic wealth and investment management.

How financial advisors earn money

Financial advisors can work for an organization, financial institution, or brokerage firm that sets a salary. Some financial advisors work independently. Depending on the type of employment, a financial advisor can earn money in the following ways:

• Wages: Financial advisors employed by banks, brokerages, or other institutions may receive an hourly wage or salary determined by their employer.
• Fee-only: Some advisors charge directly for their services through flat fees, hourly rates, or as a percentage of assets under management.
• Commission-only: Advisors using this model earn income based on the financial products they sell. This structure is common among brokerage firms.
• Fee-based: Fee-based financial advisors combine fee charges and commissions or referral earnings.

Educational pathways for CPAs and financial advisors

The educational paths for a CPA vs. a financial advisor differ. Although financial advisors don't necessarily need a degree, many get one to build the skills they'll need to sit for Financial Industry Regulatory Authority (FINRA) exams and work with clients. On the other hand, CPAs must earn a college degree to qualify for licensure.

Understand time commitments

Financial advisors must pass exams to register with FINRA and legally guide others in making investments. These exams do not require a degree, although some employers might prefer college-educated advisors. A bachelor's degree in finance or a similar subject is standard, taking about four years to complete. FINRA exam scheduling is flexible, so the test doesn't add much to the total time commitment.

The time it takes to become a CPA varies by state. In most cases, CPAs need to complete a 120-credit program and two years of experience, or 150 credits with one year of experience. Then, they must pass all four sections of the CPA exam, usually within 18–30 months of passing the first section, depending on the state.

Review admission requirements

To pursue a bachelor's degree in accounting, finance, or a similar discipline to become a financial advisor or CPA, you'll typically need a high school diploma or equivalent to apply. Many schools are ACT- and SAT-optional, but some may require English proficiency test scores.

If you want to continue your education with a master's degree to meet your state's CPA requirements, you must have a bachelor's degree. Some schools require your undergraduate degree to be in accounting or include the foundational coursework necessary for CPA licensure.

Compare CPA vs. financial advisor costs

Whether you're interested in becoming a CPA or a financial advisor, you might consider enrolling in a bachelor's program in accounting or finance. Costs can vary significantly by school, delivery method (online vs. on campus), and pacing (part or full time). Generally, tuition falls between $300 and $700 per credit, or between $36,000 and $84,000 for the entire program, although out-of-state students sometimes pay more than in-state students. You may also have additional costs for books, housing, and fees that your school doesn't include in tuition.

Schools commonly charge higher per-credit tuition for master's degree programs than undergraduate programs, but you'll also have fewer credits to complete with a master's. Expect to pay between $20,000 and $50,000 for the entire program, depending on whether you're an in-state or an out-of-state student.

Contrast coursework

Coursework for future financial advisors focuses largely on financial markets, investments, asset management, and micro/macroeconomics. In contrast, aspiring CPAs explore more accounting-focused concepts, such as cost management, accounting information systems, auditing, and federal income tax.

CPAs must also meet a specific number of credits in accounting, auditing, tax, and business topics, although state requirements vary. A bachelor's degree in accounting may satisfy state requirements. However, some candidates pursue a master's degree in accounting in addition, which includes more advanced accounting topics, such as managerial accounting and business law and taxation.

CPA vs. financial advisor: Which should you choose?

Ultimately, choosing between becoming a CPA vs. a financial advisor depends on your skills, interests, and the time and money you have available for educational, experience, and testing requirements.

Before deciding, consider the long-term rewards of each role. CPAs tend to work within a more structured framework with clear advancement paths in firms, corporations, or government agencies. Financial advisors often have more flexibility in their growth and client base diversity, especially if they work independently.

Salary and job outlook might also influence your decision. In 2024, accountants and auditors earned a median salary of $81,680, with the top 10% earning more than $141,420, according to data from the Bureau of Labor Statistics. Meanwhile, per the BLS, financial advisors earned a median salary of $102,140, with the highest 10% earning over $239,200.

The BLS also projects a stronger job outlook for financial advisors with 10% growth from 2024–34, compared to 5% growth for accountants and auditors during the same period. However, both careers are projected to grow faster than the overall average of 3% from 2024–34 across all occupations.

As you weigh your options, ask yourself:

• Do you enjoy detailed compliance work or guiding others toward long-term financial goals?
• Are you willing to invest more time in education and experience to obtain a license, or would you prefer to enter the workforce sooner?
• Do you see yourself working primarily with businesses on accounting or tax issues, or directly with clients to offer holistic financial plans?

Reflect on your answers to the above questions, and consider the following scenarios to explore which choice might be right for your future career.