Whilst there are similarities between the roles of financial planner and wealth manager, with both adopting a holistic approach and providing relationship-based services such as goal planning, investment management and some basic tax and estate planning, there are clear differences.
To summarise succinctly, a financial planner will manage the finances of those with a desire to get ahead, whilst a wealth manager handles literal wealth. Here we will explore the case for financial planner vs wealth manager in more detail.
What does a financial planner do?
The role of financial planner should not be confused with that of a financial adviser. The latter tends to deal with a specific need or goal, usually on a one-off assignment basis. This may be, for example, investing a lump sum.
A financial planner on the other hand will work with their clients on a long term basis. If you are planning for retirement for example, or have life goals in mind such as being able to support your children through higher education, or purchasing a holiday property once the kids have left home, then a financial planner will be able to help you create a roadmap that will steer you towards those goals.
Financial planning is very much goal-focused. The process will include a full evaluation of your existing financial situation and an analysis of your priorities and goals. It will usually culminate in a written plan, setting out the recommended next steps. The recommended strategies for meeting your goals will be based on your attitude to risk, your current financial situation, and the length of time available to reach your objectives.
Typically, financial planners will incorporate, where relevant, budgeting, cash flow planning, savings strategies, investment planning, tax mitigation, pension planning and estate planning. All in financial planners are focused on making a client’s money go as far as possible in order to meet the goals set.
Once you have taken time to review the recommendations made, the financial planner will work closely with other professionals such as investment specialists, tax advisers and legal experts as necessary to implement your strategies.
Once the financial plan has been set in motion, a periodic review will be carried out to ensure it is still on track to meet your objectives. This will usually be an annual review, although it may be more regular, depending on individual circumstances.
What does a wealth manager do?
The main difference when it comes to financial planner vs wealth manager is that a wealth manager will work with you more on an ongoing basis, taking care of all your financial planning and investment portfolio management requirements.
If you are seeking to protect and preserve your wealth, whether that is during your lifetime or after, a wealth manager is the professional adviser you need.
The goal of wealth management is to preserve and grow wealth. Wealth managers use the likes of estate planning, property preservation, trust creation, tax planning including Inheritance Tax mitigation strategies, risk management and family legacy planning to make sure that every eventuality is covered.
Working closely with other professionals in the legal and financial field, such as financial planners, tax advisers, investment and portfolio administrators and legal specialists, and also consulting with their clients’ own advisers such as an accountant, wealth managers will ensure that every aspect of the shorter and longer term plan are appropriately managed.
As with financial planning, wealth management will involve periodic reviews. These will, however, be required more regularly due to the typical complexity of a wealth preservation plan in comparison to a financial plan. Generally, a wealth manager will carry out a regular appraisal of investments and other strategies, the frequency of which will depend on the individual circumstances, goals and the scale and complexity of the portfolio being managed.
Wealth Management and Financial Planning Services from Partridge Muir & Warren
Partridge Muir & Warren has been trusted by the people of Surrey since 1969 for its expert, independent advice on all aspects of wealth management and financial planning. With our core aim being to protect the wealth of our clients, and our chartered status considered the gold standard in the UK financial planning industry, you can rest assured that you and your assets will be in the safest hands.
Whatever your financial goals, we are here to help you achieve them. To learn more about how we can assist you, please get in touch.