One of the main functions of a financial planner is to help people pay less in taxes. This is something that most people want since it means they get to spend more money on themselves. However, there’s one little detail that can make this a little bit of a challenge to explain to an outsider.
Essentially, if free financial advice Perth is meant to help reduce taxes, what’s the difference between an adviser and an accountant? It’s not that odd a question since people don’t know what makes one distinct from the other.
So here’s a brief overview of how they line up and how they differ.
First off, an accountant will assist with things like tax returns. They are there to help you avoid more taxes than you need to pay. They’re also there to minimize tax liabilities. The work is in hindsight, which means that they only come into play once everything has been said and done.
By law, they’re not allowed to provide extensive financial advice. Even this is possible only if they have licenses, and only in the context of self-managed super funds.
Oh the other hand, financial planners are about working in the future. The objective of their work is to plan out your financial situation, weaving a strategy that will carry you going forward.
In the case of financial planning, tax plans are just one piece of the puzzle. The advice covers more than just taxes. They delve into things like asset protection, superannuation, estate planning, investments, and more. A strategy is a key part of the game here, along with regular reviews.
Adjustments are also important.
Being kept updated is part of the service of a planner. The adviser can update you frequently, checking in and making sure that any changes to the plan are approved by you. The best will make sure you understand exactly how things are and what impact will happen if you make a change.
Now, let’s take a moment to check where the line blurs. After all, the divide between the two seems pretty cut and dry, doesn’t it?
One issue is that many financial planners are also accountants. A number of accountants are also financial planners. Even if the two aren’t one and the same, there is a strong tendency for one to work with the other. Others might refer you to each other.
Be sure to check on the Financial Services Guide when you consult either one. This will give you a clear overview of what areas they are licensed to provide expertise in.