Do You Need a Financial Planner or an Accountant? Understanding the Role Each Plays in Protecting Your Wealth
When you’ve built up significant wealth, you want to make sure it’s protected. It’s important to understand the role which accountants and financial planners play when it comes to protecting your wealth. Many clients are unsure who to approach when faced with this task, and oftentimes, when complex financial situations arise, both may be needed. The difference lies in the kind of support you are looking for.
Financial advisors and accountants can work together to share information and insights, develop investment planning, and work in sync on assessing financial goals. Although you don’t need to choose between a financial planner and an accountant to be able to protect your assets in a comprehensive and structured way, it's imperative to understand the differences between each and decide how their role is best utilised to ensure your wealth is protected.
The role of a financial planner
Financial planners typically work to help you manage your investments, superannuation, and insurance. They can provide sound advice on growing your wealth through managed funds, shares, exchange traded funds (ETFs), etc. They are licensed to give product advice and can model any future financial scenarios. They are paid through advice fees and management of investment portfolios and are proven to be most useful to you when you are seeking product-specific advice or investment strategies.
The role of an accountant
Your accountant is focused on how your wealth is structured, accessed and protected. They can provide tax-effective advice and are able to set up entities to help protect your wealth through companies, trusts and self-managed superannuation funds (SMSFs). Accountants can help you manage complex financial decisions around succession, capital gains tax, and intergenerational wealth.
Accountants are also experienced in working alongside lawyers and planners to ensure that your finances are aligned within a strategic and compliance sphere. While they do not sell financial products or provide investment strategies, their aim is to ensure you have the right platform to achieve your goals.
What is the difference?
A financial planner will be able to advise you on how to invest $5 million. Your accountant will be able to provide insight as to how to manage that investment and if it should sit within an entity such as a company or trust. An accountant will also be able to provide you with advice as to who should be the beneficiary of the investment, what the tax consequences will be, and how to support you in the long term so that you can be confident that your legacy is upheld.
How Accounting Heart can help
The aim is not to manage your money, but to help you make sense of it. The team at Accounting Heart’s role is to give you the confidence and clarity to manage how your wealth is held, accessed and passed on. We ask the right questions to support you through times of uncertainty and transition. Your advisor can collaborate with your financial advisor, lawyer, and other professionals to ensure your wealth is wholly protected and invested within the correct channels to preserve it.
Your advisor’s work is not tied to products or investments; it’s tied to your goals, values, and long-term visions of your financial future. Whether you are looking to work on the strategy, legacy, or structure of your wealth, Accounting Heart is here to help. Get in touch to find out more about how we can support you to protect your wealth and preserve your financial future.