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Financial Consulting Agreement

2 signers
1 Consultant
2 Client
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Set Your Business Relationships with a Financial Consulting Agreement

A financial consulting agreement is a document provided by a financial consultant, financial advisor, or duly authorized party to a client. It serves the purpose of creating a financial consulting services agreement that is deemed legal by a legal authority.
financial consulting agreement template

This consultant, independent contractor, or another party can perform tax planning, give investment guidance, as well as give a monthly budget plan to the client to reach financial goals. One can trade secrets; provide services; and ensure compliance in the field of financial consulting. To exhibit injunctive relief, demonstrate legal authority, and other valuable consideration, it would make sense to use a financial consulting agreement to protect such information.

An example use case would be a consultant creating a profitability improvement plan by making a client’s business model more streamlined.

Financial consulting is also known as financial advising. In such practice, a financial advisor provides advice to clients and companies in order for them to plan their financial strategies and reach their financial goals.

The two parties hereto will have multiple exchanges where discussions will be held to come up with tailored plans for daily expenses, education, retirement, and pension, as well as large-scale investments. The consultant will also have access to confidential information such as annual reports. If the advisor is licensed, he or she may even be permitted to buy and sell financial products to clients. These products may take the form of stocks, insurance policies, bonds, etc.

What is a consulting agreement?

A consulting agreement is a partnership between a consultant and a client such as when doing a joint venture. In such partnerships, there is always a client who aims to retain consulting services. In such an agreement, the specified time and a specified rate of compensation are also indicated. As the financial statements, applicable laws, and services hereunder are to be provided contains confidential information, prior written consent of both parties are required for the agreement to be legally binding.

The importance of having a solid consulting agreement

To protect intellectual property

Through the possession of a consulting agreement, individuals will be able to identify if a certain party such as a consultant or client has rights to intellectual property. Information of which rights and all types of cross-party arrangements regarding the usage, sharing, selling, and reproduction of the relevant intellectual property are also present in the entire agreement.

To define the business relationship between the advisor and client

It is without a doubt that the relationship between the two parties should be clearly defined. It should be kept in mind that a consulting agreement addresses specific, important information such as the scope of work, intellectual property rights, payment terms, and the way the two parties define their consultant-client relationship.

The difference between a consultant and a financial advisor

The two vary in terms of their purpose when brought to a client. Consultants are brought in by clients to address specific challenges or help management reach certain financial goals. Consultants do not meddle in financial or business affairs while financial advisors do. Financial advisors evaluate companies and provide internal-focused financial advice to clients.

Definition of the scope of work to be done

To identify which services based on the agreement shall be included in the consultant’s scope of work is important for the client. It would be a good idea for the two parties to note which services are to be performed and not performed to ensure compliance.

Setting up payment terms

A good consulting agreement should contain the payment amount, the frequency of payments, and the schedule of these payments. The consultant should also make sure that payments sent by the client are consistent with the set terms and that a return receipt is requested. Income statements, annual reports, and other key items fall under this category.

FAQs regarding Financial Consulting Agreement

A financial consulting agreement is a document provided by a financial consultant, financial advisor, or duly authorized party to a client. It usually outlines details on payments.
There is no actual requirement that financial consultants are licensed. However, they require various licenses to sell certain investment products or provide advice.
The two vary in terms of their purpose when brought to a client. Consultants are brought in by clients to address specific challenges or help management reach a certain goal. Consultants do not meddle in financial or business affairs while financial advisors do.

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