[imagesource: Worth Pointe Invest]
Know your friends’ strengths and weaknesses.
I have some friends, for example, that I will never trust to recommend a movie or series.
You do it once, you learn they have terrible taste, and you politely nod when they recommend something in the future.
Other friends offer sage travel advice, or legal advice, and even a little nudge in the right financial direction here and there.
That being said, planning for your future isn’t something you do on a nudge or a whim, which is where the financial experts come in.
To help us draw the line between a financial planner and a financial adviser, here’s IOL:
The financial planner… has a postgraduate qualification, offers a level of service similar to what you would expect from a family doctor or lawyer, and is bound by a professional code.
This is someone with whom you can establish a long-term relationship and who acts in your best interests to help you achieve your financial goals.
The best in the business have the internationally recognised Certified Financial Planner (CFP) designation, like the top dogs at Consequence Private Wealth, and help you with a tailor-made financial plan designed to help you reach those long-term financial goals.
At the same time, sometimes the goalposts shift, so those plans need to be flexible:
Your financial plan is a working document and is something that should be regularly reviewed and updated as you go through life – you might have a new baby, you might change your goals…
A planner may be likened to a medical general practitioner: while the planner should consider all your financial needs, he or she may refer you to a specialist when necessary.
This is where the financial adviser comes in, which, according to Investopedia, is a broad term for a professional who helps manage your money:
You pay the adviser, and in exchange, they help with any number of money-related tasks. A financial adviser might help manage investments, broker the sale and purchase of stocks and funds, or create a comprehensive estate and tax plan…
“Financial adviser” as a general term includes subsets of the financial adviser group, such as stockbrokers, insurance agents, money managers, estate planners, bankers, and more.
Think of the comparison between a financial adviser versus a financial planner like a funnel with the financial adviser on top. Continuing with this analogy of the funnel and going further down, a financial planner is a type of financial adviser.
If you’re unsure which works best for your needs, put together an outline of what you want to achieve, and your end financial goals.
Ultimately, you want somebody who understands that the consequences of decisions made today will bear fruit over the years based on the sound principles applied at their inception.
Good luck on your financial journey, wherever it takes you.
[sources:iol&investopedia]
