Financial Planner vs. Financial Advisor: What’s the Difference?

What Is a Financial Advisor?

"Financial advisor" is a catch-all term for financial professionals who can help you manage your money. That can include financial planners, but it can also include insurance agents, estate planners, private bankers, tax professionals, stockbrokers and more.

While financial advisors don't always act as financial planners, giving you a holistic approach to your finances, they can specialize in certain areas, which can be beneficial if that's all you're looking for.

Financial advisors need to be licensed to sell investment products and services, as well as insurance policies. There are a few different ways financial advisors get paid:

• Fee only: You'll pay a fee, typically at an hourly rate, but it could be an annual rate.
• Commission: You don't have to pay to consult with your planner, but they'll charge a commission for trades as they manage your investment account.
• Fee and commission: These advisors make money from a mix of fees and commissions.

Learn more: What Are the Different Types of Financial Advisors?

What Is a Financial Planner?

A financial planner is a professional who helps you build a comprehensive strategy for your entire financial life. They typically review your full financial picture—income, expenses, debt, savings, investments, insurance and long-term goals—and offer guidance across all major areas of money management. Some may be certified financial planners (CFPs), who must pass a rigorous exam and other qualifications set by the CFP board.

Many financial planners also function as financial advisors by offering investment guidance or managing your portfolio. If they provide specific products or services, such as investment management or insurance, they must hold the appropriate licenses to do so. They also typically get paid in the same ways as financial advisors.

Some planners specialize in fields like retirement planning, investing or estate planning, but most still provide holistic recommendations that tie your whole plan together. But because planners can have a specific focus area, be sure to work with one that aligns with your top priorities.

Financial Advisor vs. Financial Planner

A financial advisor typically focuses on specific financial tasks or products, while a financial planner builds a full strategy for your long-term goals. Here are the key differences:

• Scope: Advisors often help with targeted needs like investing, insurance or retirement accounts, while planners address your entire financial life.
• Approach: Advisors tend to specialize in certain areas, but planners take a holistic view that ties all financial decisions together.
• Services: Advisors may offer investment guidance or product recommendations, while planners help with budgeting, goal setting, taxes, estate planning, insurance reviews and more.
• Planning style: Advisors are a fit when you need focused support, while planners are ideal when you want a long-term roadmap.

If you're deciding between the two, consider whether you want help with a single financial area or broader guidance across every part of your finances.

Learn more: How to Choose a Financial Advisor

Should I Work With a Financial Advisor or a Financial Planner?

Choosing between a financial advisor and a financial planner depends on your goals, the type of guidance you need and how involved you want your professional to be in your long-term financial strategy. Each can play an important role, but one may be a better fit based on your situation.

When to Consider Working With a Financial Advisor

• You need investment management services. Advisors often specialize in building and managing portfolios, making them a good fit if your primary need is investment guidance.
• You want ongoing portfolio insight. If you prefer regular updates on market trends or your investment performance, an advisor can provide ongoing monitoring.
• You need help with a specific product. Advisors can help you select insurance options, annuities or other financial products that fit your needs.
• You want targeted support. When you only need help with one area, such as retirement investing or college planning, an advisor's specialized expertise can be enough.

Learn more: Questions to Ask a Financial Advisor

When to Consider Working With a Financial Planner

• You want a comprehensive financial roadmap. Planners can help you build a long-term plan that covers budgeting, savings, debt, investing, insurance and estate considerations.
• You're just getting started financially. If you want help laying a foundation for your financial life, planners can guide you through every key decision.
• You're preparing for major life changes. Events like marriage, buying a home or starting a family benefit from the full-picture guidance a planner provides.
• You want coordinated advice. Planners ensure that your financial decisions work together, reducing the chances of creating gaps or conflicts in your long-term strategy.

Frequently Asked Questions

Learn more: Fiduciary vs. Financial Advisor: What's the Difference?

The Bottom Line

If you're looking for financial guidance, both financial planners and financial advisors can offer valuable support. But while the terms are often used interchangeably, they aren't identical.

Start by considering your goals and the type of help you need. If you want broad, long-term planning, a financial planner may be the better fit. If you need targeted guidance—like investment advice or help choosing insurance—an advisor might make more sense.

Either way, take your time to vet professionals carefully. The right expert can make it easier to stay on track with your financial goals, but choosing someone who fits your needs and approach is key.