Managing your finances can be challenging at times. There are specialists who can help you make informed decisions. Two such experts are financial planners and financial advisers.
Both work with clients to help them achieve their financial goals. But, there are key differences between the two.
These differences might not seem that important, but they really are. Good financial planning can make a huge difference to the outcome you get as well as your experience. If you already have a Planner or Adviser then check below to see if the service you receive matches the fees you are paying. If not have a discussion with them.
Independent financial planners will help you create a thorough financial plan. This plan takes into your income, expenses, assets and expenses, as well as long-term goals and objectives. The results of your plan are used to help shape your financial planning. The aim is to create a plan that gives you security & independence.
Most planners use sophisticated software to help develop plans for their clients. Consilium Asset Management has invested in the best UK-based financial planning software to help our clients. All correspondence is sent to you securely to protect you and your finances.
At Consilium Asset Management, we consider ourselves personal financial planners. We provide advice on a wide range of financial issues. This could include retirement, investment management, estate and tax planning.
One of the key benefits of receiving advice is peace of mind and progress with your finances.
Having someone that is impartial allows you to ask questions knowing you will get a straightforward answer.
Clients often know the direction of travel they wish to take. They are often looking for advice in financial matters, guidance and reassurance that they are on the right course.
We help you take an overall view of your finances. The focus is on creating a long-term plan to help and guide you.
Most financial planning firms provide holistic financial advice. This is advice that covers all aspects of your finances, and it will include investment, retirement and tax planning. Most aspects of financial advice are interlinked—for Example, Investing and Inheritance Tax. We can help review all aspects of financial advice. Most modern planning companies use technology to help their clients and their finances. This can include secure communication as well as using digital signatures. We aim to simplify things for our clients as much as possible.
A financial adviser in the UK usually advises on a specific topic. Advice could include pensions or investment advice. They may help their clients review their pensions and investments, and they might provide advice on life assurance and mortgages.
A Financial Adviser does not normally take a holistic approach to your financial plan. Financial advisers may be Independent or restricted. Restricted advisers can only advise on a limited range of products. The Financial Conduct Authority (FCA) authorises Independent Financial Advisers and Restricted advisers.
Most financial planning and advisers belong to a professional body. The two main bodies are the Chartered Insurance Institute and alternatively CISI. Some advisers use the Personal Finance Society designation. Whilst others use Certified Financial Planners cfp.
A financial advisor is not just someone who manages your investments. They can provide advice on a range of products and services, such as pensions, life assurance, and mortgages. Advising on one area of advice is not holistic financial planning.
We sometimes get asked to explain the differences between a financial planner vs financial advisor.
The primary difference is the breadth of the advice they offer. Planners provide a service covering all aspects of your finances.
Financial Planning firms prefer to work with clients on a long-term basis. The aim is to understand what is important to the client. They will help clients develop their plans over the long term to help them achieve their goals and aspirations. Financial Planning firms typically meet their clients twice a year to develop their plans and adjust when required.
The aim of the financial planning firm is to ensure the outcome for the client is better and meets the client’s needs. This can also include financial coaching and in-depth discussions on finances. Strategic tax planning and tax reduction are also one of the main areas they can help you on.
At Consilium we offer planning as well as financial advice.
For Example, this could include early retirement or how to minimise pensions tax charges.
Most Independent Planning firms provide cashflow planning, which helps with investment, retirement and estate planning.
Financial advisers, on the other hand, focus on advice. The advice can include investment management, pensions advice, mortgages and life cover, and they look at single aspects of financial advice.
The amount a planner might charge for advice can vary. In the UK, many firms charge adviser fees of 1%per annum as a percentage-based fee, and we feel this level of financial adviser fees is too high. The Financial consultation on Consumer duty will be implemented in July 2023, putting ongoing charges of 1% under pressure. A fee based on a % of assets might be suitable for some clients.
But a fixed fee option would be better if you have substantial savings. In the UK, the Average percentage-based fee is 0.8%. For example, for a portfolio of £3m, the cost could be £24,000 p.a
We offer a percentage or fixed fee approach. Our fixed fee approach is for High Net Worth Investors. A portfolio of £3m would be about £7,000 per annum financial adviser charge, which is over 60% less.
If a client wishes to pay for advice on a pay-as-you-go basis, we can charge an hourly rate.
In most cases, hiring a planner is better value for money. You will receive a full review of all areas of your finances. In addition, your plan will cover a review of your tax, pensions & investments. They can advise on how to improve your finances.
Financial Advisor and Financial Planning firms will offer advice that could help you. For straightforward issues, an advisor that offers a simplified advice service would be the best option. Financial planning is the way to take control of your finances.
Our experience is that most people think they want a financial advisor. In reality, they need a financial planner. There is no point in investing money for the sake of it.
Most people need help and guidance. This is true for complicated areas such as pensions. We can show you where you are today & where you want to be.
If you live in the Bristol area, then Consilium is your local financial adviser that specialises in Investment and Retirement Advice. If you want to know more, please book an online appointment.
Hiring a planner can be wise, especially if you need help managing your finances. They can help you create a long-term plan to secure your future and guide you in making critical financial decisions. Expert financial advice can be beneficial at key moments in life. For example, when you get a promotion, retire or receive an inheritance.
A financial advisor is best if you need advice in one area. They can provide assistance and guidance on financial products. If you want a long-term plan, working with a planner is best.
Using a financial advisor isn't mandatory. You do not need to use an advisor to manage your retirement. But it can make sense to hire a financial planning specialist. For example, UK pensions are complex and complicated.
Knowing how and when to take income needs to be correct. A planner can help you make the best decision.
We work with our clients on a long-term basis. The initial plan might only take a few weeks to build. We will keep your plan up to date as it will change each year.
With some clients, there becomes a point when advice is no longer required. When you no longer need advice, we will discuss the options with you.
Our clients have at least two review meetings each year, which can be at our offices, at home or online. We also have our own portal so you can securely contact us and review the valuations of your investments online. We also issue a monthly newsletter and a Bi-monthly online magazine called smart money.
It all really depends on the complexity of your finances. This is important due to the cost of regulation in the UK. If you have a straightforward set of circumstances then probably £100,000. If your financial situation is more complicated then a minimum of £300,000
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This article is not intended to be financial advice. It is important to consult a professional when considering Investing. The value of investments can change, and it is possible to lose money.
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