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What is a financial adviser, and how does it differ from a certified financial planner?


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"Financial adviser" is a generic term whereas "certified financial planner" is specific:

Sort of. "'Financial adviser' is a generic term with no precise industry definition, and many different types of financial professionals fall into this general category," Investopedia explains

"Stockbrokers, insurance agents, tax preparers, investment managers and financial planners are all members of this group. Estate planners and bankers may also fall under this umbrella."

"It's unbelievable the scope or range of people that can consider themselves financial advisers or financial planners," Bob Gavlak, CFP and wealth adviser with Strategic Wealth Partners in Columbus, Ohio, told Business Insider. "The majority of time, if somebody calls themselves a financial adviser, usually all that means is that they're investment advisers — all they do is investment management."

Gavlak says a financial adviser might not have the training to help you with taxes, insurance, investments, and estate planning. 

On the other hand, you have the Certified Financial Planner (CFP). While it sounds similar to "financial adviser," it's not quite the same. "A lot of times people will look at financial advisers and certified financial planners and they think that they're all the same, but that would be like looking at a restaurant and saying McDonald's is the same as some really fancy steakhouse," says Gavlak.

Certified financial planners have to be certified by the Certified Financial Planner Board of Standards, Inc., which is why you'll often see a registered mark after their designation (CFP®).

To become certified, they have to complete what the board calls the four Es: education, examination, experience, and ethics. These planners are certified to advise on everything from taxes to insurance to estate planning, and are required to complete ongoing continued education requirements. One of the hallmarks of a CFP is that they have fiduciary responsibility when working on financial planning, which means they have to act in their clients' best interest.

Is paying a fee-based financial adviser worth it? Yes:

http://businessinsider.com/paying-for-a-financial-adviser-worth-it-2016-10

6 times an investing adviser is not a waste of money:

http://businessinsider.com/when-an-investment-adviser-isnt-a-waste-of-money-2016-11

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