Who do you go to when you need advice? Who do you go to when you need help?
We have found that the answer to the first question is often: Someone I trust. And, the answer to the second question is: Someone who is an expert.
When it comes to the financial world, we need both.
Personal finance has become increasingly complex. With so many different flavours of financial products on the market, it’s no wonder that we sometimes need help negotiating the array of options and choices that need to be made. Even those with prudent financial expertise need time to invest in keeping abreast of new developments. So, how do we know who is best equipped to provide financial guidance – do we need an adviser? A planner? A guru?
There is a clear distinction between a financial planner and an adviser. (While a financial guru is more of a self-proclaimed endowment than a certified career option.) Getting the right financial advice at the right time can have an immense long-term impact on your quality of life. So it is essential that we know we are getting the right advice, from the right person, for our specific needs.
As for the distinction, every financial planner is a type of financial adviser, but not every financial adviser is a financial planner.
A financial adviser is a broad term for professionals who help you manage your money. This list can include stockbrokers, insurance agents, estate planners, money managers, and more. There are also many financial adviser credentials they might hold, depending upon the services that are provided.
A financial planner is a professional who helps create a strategy to meet long-term financial goals. The financial planner might have a specific area of expertise such as investment, taxes, estate planning or retirement. Furthermore, the financial planner may hold various licenses or designations that require the completion of a set of education, examination and work history requirements. There are numerous financial courses and diplomas which are reputable. However, the CFP (Certified Financial Planner) qualification is widely regarded as one of the top industry qualifications internationally.
It is helpful to understand what you are paying for when hiring a financial professional to help you with your finances. Many planners and advisers may overlap and do the same thing. Find out what services they provide, their credentials, and see if they have specialised experience relating to the financial services you require.