“What is the difference between a Wealth Manager, Financial Adviser and Financial Planner?”

If you’re looking for professional help with your finances, one of the questions you may be asking yourself is ‘what is the difference between a Wealth Manager, Financial Adviser and Financial Planner?’

This short blog will help you to understand:

• Financial adviser vs Wealth Manager vs Financial planner

• How to pick a financial adviser

What’s the difference?

The truth is all of these terms can be used to describe the providers of regulated financial advice, and are often used interchangeably.

Some may dispute this, but – in my opinion – the terms are more about branding, than the type or quality of service that is offered. 

The term ‘Wealth Management’ in particular, is designed to project a certain image and appeal to a wealthier client base. It’s also an attempt by ‘Wealth Managers’ to distinguish themselves from the traditional title of ‘Financial Adviser’, which may have negative connotations particularly with older clients who remember past scandals from the days of low regulation and high commission.

There is more substance to the term ‘Financial Planner’.  Financial Planners aim to provide broader, goal-based financial advice; often using cashflow planning software to gain a fuller understanding of clients’ financial situations.  There is an emphasis on planning, rather than financial products which ensures that advice is focused on the needs of the client (rather than the fees of the adviser).

But none of these terms are protected titles, and so regulated firms and individuals can call themselves whichever they chose.

With this being the case, how should you choose between the financial advice professionals out there?

Here’s what I believe are the 4 key differentiators:

1.      Independence - Independent Financial Advisers (IFAs) are free to advise clients on whichever products or investments they feel best suit their client’s needs.  On the other hand, ‘Restricted’ advisers can only offer a limited range of products or investments.

2.      Qualifications – there are different levels of qualification, ranging from A-Level to post-graduate standard, and advisers can choose to specialise in certain areas. 

3.      Fees – From 2013, the Retail Distribution Review (RDR), banned commission payments from investment and pension products to regulated financial advisers.  Advisers now charge explicit fees for their services, the structure and size of which varies widely between firms.

4.      Character – financial advice can have a huge impact on your life and the relationships between advisers and their clients can last decades.  It’s therefore important that you chose to work with someone you trust and respect.

Get in touch

If you’re looking for an independent, highly qualified financial planner near Bath or just want further information, please get in touch. Email daniel@wiltshirewealth.com or call 01225 699790.