Is Wealth Management different than Financial Planning?

 October is Financial Planning Month and Center Partner Tim Wyman takes this opportunity to bring us back to the basics. In this blog 5-part series he clarifies some general questions about financial planning and the financial planning process. 

The financial planning profession is still a relatively new profession and continues to develop and mature. In the last ten years or so, some firms have begun using the phrase “Wealth Management” to describe their services.  Essentially, some firms wanted to differentiate themselves to higher income and higher net worth clients.  In many cases, Wealth Management and Financial Planning are synonyms.  There are many fine financial planners and firms in the country, unfortunately financial planning to many companies in the financial services industry is not a process; rather it is a tactic used to sell financial products.  From my perspective, the use of other names such as “wealth management” is for marketing and positioning reasons. 

In the end, financial success, like anything worthwhile, takes patience and persistence. Financial planning or wealth management done right is the process of assessing your financial goals and then developing appropriate strategies to accomplish those goals without taking unnecessary risks.  Simply stated, the purpose of financial planning is to efficiently allocate your current and future financial resources. Proper financial planning requires an ongoing series of decisions made on your part, based on interaction between you and all your advisors.  Lastly, regular updates and reviews are necessary to keep you on course and to provide you with the opportunity to make any necessary adjustments as financial conditions change. 

In my next blog, we’ll discuss who needs a financial plan and in the final installment of this series find out how to prepare your financial plan and how much it will cost. 

Timothy Wyman, CFP®, JD is the Managing Partner and Financial Planner at Center for Financial Planning, Inc. and is a frequent contributor to national media including appearances on Good Morning America Weekend Edition and WDIV Channel 4 News and published articles including Forbes and The Wall Street Journal. A leader in his profession, Tim served on the National Board of Directors for the 28,000 member Financial Planning Association™ (FPA®), trained and mentored hundreds of CFP® practitioners and is a frequent speaker to organizations and businesses on various financial planning topics.

Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.  Every investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment.  Clients should evaluate if an asset-based fee is appropriate in servicing their needs.  A list of additional considerations, as well as the fee schedule, is available in the firm’s Form ADV Part II as well as in the client agreement.