What’s the difference between a financial adviser and a financial planner?

There’s no shortage of financial professionals to help you manage your money. However, two of the most common designations are that of financial adviser and financial planner.

Many people believe that the terms are interchangeable, but this is inaccurate. In reality, all financial planners are financial advisers, but not all financial advisers are financial planners.

Financial advisers
Financial adviser is an umbrella term for professionals who help their clients manage their money. They may be bank employees that help their clients understand the range of products they offer of professionals who work independently. They often specialize in handling investment portfolios.

Financial planners
A financial planner is an adviser who specializes in helping individuals and companies create programs to meet their long-term financial goals. They assess the client’s whole financial situation in addition to any investments they currently hold. The strategies they create may include estate and retirement planning, education funding, insurance and risk management and taxation.

When hiring a financial professional of any kind, make sure they have the proper education and expertise. Almost anyone can take on the title of financial adviser. This means that while the person you work with may have extensive knowledge and training, they may also simply be a salesperson for the bank.