Is it planning or advising?

In our complex world of financial products, markets, consulting, advising, planning and processing fiduciary requests, we often get asked what the difference is between financial planning and financial advice.

And, with all the fees, jargon and lollygagging that can sometimes be experienced in our profession – this is a fair question.

Financial planning and financial advice are both important tools for managing your finances, but they are not the same thing. Financial planning is a comprehensive and long-term process for creating a roadmap for achieving financial goals. In contrast, financial advice is a service provided by a professional financial adviser that focuses on specific financial products and strategies.

Even though the two are distinct concepts in the world of finance, they are often used interchangeably, which can lead to confusion. It is helpful to understand the differences between the two to make informed decisions about managing your finances.

Financial planning is a process that usually involves an in-depth analysis of an individual’s financial situation, including their income, expenses, debt, and assets, to determine their current financial status and to identify areas for improvement.

Financial planners then create a customised plan that considers the individual’s financial goals, risk tolerance, and time horizon. The journey typically includes strategies for minimising taxes, estate planning, reducing debt, increasing savings, and investing for the future. The ultimate goal of financial planning is to help individuals achieve financial stability and independence.

On the other hand, financial advice is a service provided by a professional financial adviser. The adviser provides recommendations and guidance on specific financial products and strategies to help individuals meet their financial goals as outlined in the financial plan. For example, a financial adviser may recommend a particular investment product or a specific portfolio of investments based on the individual’s risk tolerance and financial goals.

Having worked in Africa for over ten years, being based in Toulouse, France, and advising clients in over 20 countries worldwide, I’m uniquely qualified and experienced to help you with both your financial planning and the crucial advice needed to put that plan into play. No matter where you are in the world, or where you are on life’s journey, let’s chat.

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