{"id":487,"date":"2020-10-08T00:00:00","date_gmt":"2020-10-08T04:00:00","guid":{"rendered":"http:\/\/staging-prblog.paladinregistry.com\/blog\/?p=487"},"modified":"2021-02-15T01:31:45","modified_gmt":"2021-02-15T06:31:45","slug":"differences-between-financial-planner-financial-advisor","status":"publish","type":"post","link":"https:\/\/www.paladinregistry.com\/blog\/advisors\/differences-between-financial-planner-financial-advisor\/","title":{"rendered":"What are the Differences between a Financial Planner and Financial Advisor?"},"content":{"rendered":"\n<div class=\"wp-block-image\"><figure class=\"alignleft\"><a href=\"http:\/\/blog.paladinregistry.com\/wp-content\/uploads\/2013\/03\/financial-planners-advisors.jpg\"><img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"174\" src=\"http:\/\/blog.paladinregistry.com\/wp-content\/uploads\/2013\/03\/financial-planners-advisors-300x174.jpg\" alt=\"financial planners advisors\" class=\"wp-image-5100\" srcset=\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/03\/financial-planners-advisors-300x174.jpg 300w, https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/03\/financial-planners-advisors.jpg 620w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a><\/figure><\/div>\n\n\n\n<p><a href=\"http:\/\/blog.paladinregistry.com\/advisors-2\/why-select-a-certified-financial-planner\/\">Financial planners<\/a>&nbsp;provide a number of planning services that help you manage your financial life. Financial security is the number one goal for planners, but college, retirement, and estate plans are also included in the planning process. <a rel=\"noopener noreferrer\" href=\"http:\/\/blog.paladinregistry.com\/advisors-2\/financial-advisor-for-real\/\" target=\"_blank\">Financial advisors <\/a>are focused on the investment of your assets. They provide several services that include investment policy, asset allocation, manager selection, and performance reporting. Financial planner and financial advisor appear to provide distinctly different services, but that is not the case. <\/p>\n\n\n\n<p>Some planners provide investment advice and services. Some advisors provide planning advice and services. So a financial professional\u2019s title may not depict what the professional actually does.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Planning to Advising<\/strong><\/h2>\n\n\n\n<p>Why do so many financial planner provide investment advice? The answer is they make a lot more money. The planning business is intensely competitive and a lot of planners provide planning services for free (more about that later). And, obtaining new clients is an expensive, time-consuming process. The more revenue they generate from clients the more income they produce for themselves.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Advising to Planning<\/strong><\/h2>\n\n\n\n<p>So why do advisors also provide planning services? Everyone needs planning so it reduces sales resistance if they lead with planning versus investment advice. Equally important is their investment recommendations that can be imbedded in their financial plans so the plans do the selling for them.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Insurance<\/strong><\/h2>\n\n\n\n<p>There is also a major insurance element in most financial plans \u2013 for example, estate plans when insurance is used to pay inheritance taxes. In the past, 70% of all <a rel=\"noopener noreferrer\" href=\"http:\/\/blog.paladinregistry.com\/advisors-2\/is-your-financial-planner-an-insurance-agent-upd-oct-2014\/\" target=\"_blank\">financial planners were insurance agents<\/a>. That\u2019s because there was a major stigma associated with the title insurance agent. There still is, but a lot of agents have gone covert by calling themselves financial planner.<\/p>\n\n\n\n<p>Make no mistake there are a lot of insurance applications in a financial plan: Life, Annuity, Long-Term Care, Disability Income, Health, and other forms of insurance. Most planners are reluctant to refer their clients to insurance agents who may sell against them or sell low quality insurance products to their clients. Consequently, the financial planner sell insurance products themselves and keep the commissions.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Fee &amp; Commission<\/strong><\/h2>\n\n\n\n<p>When you add it all up, a simple financial plan can produce four types of income for the planner: <a href=\"http:\/\/www.paladinregistry.com\/articles\/why-pay-fees-for-financial-advice\" target=\"_blank\" rel=\"noopener noreferrer\">Planning fees, investment fees<\/a>, investment commissions, and insurance commissions. Even relatively small plans can produce thousands of dollars of compensation for financial planners and financial advisors.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>The Free Lunch<\/strong><\/h2>\n\n\n\n<p>Be very cautious when planners and advisors claim they will produce a financial plan for free. What they are really saying is there are no separate fees for their planning advice and services. Instead, they have wrapped the planning expense into an asset-based fee or they are being paid commissions by third parties. Then the third parties mark-up their fees to you to cover the commissions they paid financial planners and financial advisors. One way or another, these commission expenses are passed through to you.<\/p>\n\n\n\n<p><strong>About the Author<\/strong><\/p>\n\n\n\n<p><em><a href=\"https:\/\/www.paladinregistry.com\/blog\/author\/jack-waymire\/\">Jack\u00a0Waymire<\/a> worked in the financial services industry for 28 years before he left to found the Paladin Registry (<a rel=\"noreferrer noopener\" href=\"http:\/\/www.paladinregistry.com\/\" target=\"_blank\">www.PaladinRegistry.com<\/a>) in 2004. This investor education website was based on the Principles in\u00a0Jack\u2019s first book:<\/em> <em>&#8220;Who\u2019s Watching Your Money?\u00a0The 17 Paladin Principles for Selecting a Financial Advisor.&#8221;\u00a0<br>The Registry also has a free service that matches investors to advisors who meet Paladin\u2019s minimum requirements for competence and trustworthiness.<\/em><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Financial planners&nbsp;provide a number of planning services that help you manage your financial life. Financial security is the number one goal for planners, but college, retirement, and estate plans are also included in the planning process. Financial advisors are focused on the investment of your assets. They provide several services that include investment policy, asset allocation, manager selection, and performance reporting. Financial planner and financial advisor appear to provide distinctly<\/p>\n","protected":false},"author":2,"featured_media":5100,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[325],"tags":[],"class_list":["post-487","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-advisors"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Differences between Financial Planner and Advisor - Paladin Registry<\/title>\n<meta name=\"description\" content=\"A financial planner and a financial advisor appear to provide distinctly different services, but that is not the case. 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The title may not depict actuality.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.paladinregistry.com\/blog\/advisors\/differences-between-financial-planner-financial-advisor\/\" \/>\n<meta property=\"og:site_name\" content=\"Paladin Registry Blog\" \/>\n<meta property=\"article:author\" content=\"https:\/\/www.facebook.com\/PaladinRegistry\" \/>\n<meta property=\"article:published_time\" content=\"2020-10-08T04:00:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-02-15T06:31:45+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/03\/financial-planners-advisors.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"620\" \/>\n\t<meta property=\"og:image:height\" content=\"360\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Jack Waymire\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@PaladinRegistry\" \/>\n<meta name=\"twitter:site\" content=\"@PaladinRegistry\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Jack Waymire\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/differences-between-financial-planner-financial-advisor\/\",\"url\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/differences-between-financial-planner-financial-advisor\/\",\"name\":\"Differences between Financial Planner and Advisor - Paladin Registry\",\"isPartOf\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/differences-between-financial-planner-financial-advisor\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/differences-between-financial-planner-financial-advisor\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/03\/financial-planners-advisors.jpg\",\"datePublished\":\"2020-10-08T04:00:00+00:00\",\"dateModified\":\"2021-02-15T06:31:45+00:00\",\"author\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/4f94af521e23212d5ffd08618ecb46c0\"},\"description\":\"A financial planner and a financial advisor appear to provide distinctly different services, but that is not the case. 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