What’s the Difference Between a Financial Advisor/Planner Vs. Insurance Agent?

It’s time for another edition of Dollar and Cents. This is where I answer one of your questions.

If you have a question, either use the contact form on the blog or use my Facebook Fanpage.

Recently, I was introduced to a new Financial Planner in my area. I asked all the right questions, but did not receive any of the right answers. I was becoming concerned. It turns out, the Financial Planner is not a Certified Financial Planner (CFP), let alone even registered with FINRA or the SEC. After doing some additional homework, I learned the Financial Planner is a insurance agent selling only annuities. But the Financial Planner walks, talks, introduces themself as a Financial Planner (not CFP — which can be unclear to thee uneducated client) and a full blown website talking about the merits of comprehensive financial planning . . . but really only selling Fixed and Indexed Annuities for one of the larger insurance companies. Can the agent call himself a financial planner? What’s the difference between a financial planner/advisor or life insurance agent?

Resources:

With each Dollars and Cents video we want to provide some follow up links where you can get some additional information on the topic. If you are interested in learning the difference between a financial planner, CFP, financial advisor and life insurance agent, here are some great reads:

  • 7 Financial Advisors I Would Like to Punch in the Face – I’m a nice guy, but there are 7 types of financial advisors that I cannot stand. They prey on their clients’ ignorance and lie, cheat, and steal along the way. A great read if you are looking for an advisor; I’ll show you what to watch for.
  • Fee-Only vs. Fee-Based Financial Advisor: What’s the Difference? – Two things to look for in this post: another great video and 3 different links to articles that explain the difference between these two types of advisors.
  • How to Become a Certified Financial Planner – The CFP designation is one of the hardest but most respected marks of the financial planning industry. The post talks about how to become one. Even if you don’t personally want to be a CFP it is important to know what is behind the designation and why it is so important to look for it when talking to financial advisors or financial planners.
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