Dec 18, 2017
When keeping on top of your finances, taxes and wealth goals, you may be inclined to think that an accountant and financial adviser are one and the same.
Does it matter who you consult?
Actually, it really does. Your financial needs and plans determine which area of expertise will help you the most.
Both accountants and financial planners are experts in their field and carry different licencing requirements. Financial advisers can only provide limited taxation advice and must be appropriately licenced to give that taxation advice. In the same way accountants can only provide limited financial advice and must also be appropriately licenced to do so.
The Difference Between Accountants and Financial Advisers
An accountant is a trained professional who will assist you to ensure that you attend to your compliance obligations for tax and other statutory reporting obligations if you operate a business. Part of your accountants role can also be to assist you to ensure your cash flow meets your requirements while helping you save as much as possible and to help you make important business decisions. Accountants ensure that every penny is appropriately accounted for with detailed record keeping.
When you need advice on how to use your funds so that you see the greatest benefit down the road, then it’s time to consult a financial adviser.
Financial advisers can work with your accountant and continue the process of wealth creation by advising where to invest your funds and how to protect your income and your wealth.
After ensuring that you’ve paid out all you owe in taxes, you have to reposition your finances and goals for the upcoming year and beyond. Your accountant may not be the right fit, and may not be qualified, to help you decide how best to invest and plan for the future ahead. Financial advisers are trained, licensed and experienced in doing just that.
When Do You Need an Accountant Vs Financial Adviser?
Every person needs a hand with their tax return. And every business certainly needs the assistance of an accountant to ensure they meet all of their various statutory lodgement obligations. Business structuring and business advice is an important role of an accountant for business owners.
Once you’ve paid off anything you owe the tax man and made appropriate business decisions based on the qualified advice of your accountant, your remaining funds are yours to do with as you please.
A financial adviser will then to step in to help build a plan around your wealth goals, and explain multiple options for saving, investment and protection.
No one likes living paycheck-to-paycheck. So as an alternative to spending all of your disposable income, an adviser can help you find ways to use it to increase and protect your wealth.
Why Consult a Licensed Financial Adviser?
Some may think just meeting with an accountant should be enough to make smart financial decisions. But there are some financial decisions that require the assistance of someone with a different set of qualifications and experience.
To build and protect your wealth you’ll want to seriously consider seeking qualified financial advice in addition to your accounting advice.
Until 1 July 2016, an exemption allowed accountants to provide financial advice concerning Self-Managed Super Funds (SMSF).
Currently, accountants can apply for a license to provide limited financial advice, primarily related to SMSF, insurance products, securities and basic deposit products.
But without a license, an accountant can no longer legally provide that advice.
You should work with a team of advisors who can skillfully advise you on the full range of financial decisions you face.
Build Your Team
Your accountant absolutely has an important role to play, alongside your financial adviser. You may also need the services of a finance broker, if you have an interest in property. Ultimately, you need a team of trusted experts behind you.
Expert Financial Advice
For a no obligations discussion about your needs, reach out to our team here at Calder Wealth Management. Call on 08 8373 3333 today to schedule an an appointment.
- Ben Calder, Private Client Adviser
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