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Comprehensive Financial Planning Versus Investment Management

Comprehensive Financial Planning Versus Investment Management

30 Jun 2022

Investment management and financial planning might seem fairly similar yet there are substantive differences between the two. In particular, truly comprehensive financial planning is significantly different from investment management. You need and deserve an experienced fee-only, fiduciary CERTIFIED FINANCIAL PLANNER™ Professional 

to perform comprehensive financial planning on your behalf.  

 

In Akron-Canton investment management is time-tested and investment strategies are managed by the McGervey Investment Committee.

 

The Difference Between Portfolio Management and Financial Planning

Though portfolio managers and financial planners have similar designations, their roles and daily work responsibilities are quite different. Portfolio managers manage the subtle nuances of investing on a client’s behalf. Financial planners take more of an overarching macro view of a client’s finances, creating financial aims to strive toward and the plan of action necessary to reach those goals.  

The best financial planners provide holistic financial planning in which the entirety of a client’s personal finances are accounted for. This includes their current financial standing, risk tolerance, and nuanced benchmarks for success. Though a financial advisor can perform active investment management on a client’s behalf, they do not always delve as deeply into the level of investing detail as portfolio managers.  

The best CERTIFIED FINANCIAL PLANNER™ Professional should ground their relationship with clients in financial planning for the long run, meaning they develop a sound plan for the ensuing decades rather than merely establishing an initial projection. Each and every financial decision made by our financial planners is tailored to your unique preferences and goals with the aim of long-term financial success. 

This is opposed to advancing our own revenue through commission-based sales. Our client-centered approach sets the stage for building wealth in both bear and bull markets in the short-term and across posterity.

You Need More Than a Portfolio Manager

There is a common misconception that investment management is all that is necessary for financial planning. Investing is an integral component of the overarching financial picture, yet it’s only one piece of the puzzle to building a nest egg that helps you live the good life in retirement. True financial planning encompasses everything from budgeting to saving, insurance, the strategic payment of debt, setting financial milestones, and plenty more.  

An Akron-Canton financial advisor will help you develop a plan for saving, investing, creating an emergency fund, attacking your debt, and investing. Meet with one of our CERTIFIED FINANCIAL PLANNER™ professionals, and tell us about your specific financial goals, be it buying a car, starting a family, saving for college, or early retirement. We will develop a financial plan suited to your unique aims and current financial standing.  

We will factor in your current financial assets when creating your financial plan for the future. This means all assets including current investment accounts, savings accounts, retirement accounts, real estate, and even debt will be accounted for. Our financial planners will actively manage your investments on your behalf based on your tolerance for risk, financial goals, and economic dynamics here at home and abroad.

a graphic of a maze with the words portfolio management in the center

Investment Portfolio Management

Investment portfolio management is performed by financial professionals who form investment portfolios consisting of securities ranging from stocks to exchange-traded funds (ETFs), mutual funds, bonds, and other investment vehicles. Investment portfolio managers create portfolios based on each unique client’s investment aims and preferences.  

Active investment portfolio managers perform ongoing analysis and make trading decisions accordingly. However, some portfolio managers are passive, meaning they perform comparably infrequent adjustments. Such professionals rebalance investor portfolios as time progresses to ensure holdings are aligned with the investor’s preferences and tolerance for risk.  

Investment management should be viewed as a component of financial planning, meaning it is incomplete in and of itself. Though everyone can benefit from the guidance of a professional who understands how to invest hard-earned money, investing alone will not suffice when it comes to financial success. Opt for the assistance of a CERTIFIED FINANCIAL PLANNER™ Professional and he or she will weave investment management into your entire financial plan, creating a whole that is greater than the sum of its parts.  

Read: The 4-Step Investment Process

You Need and Deserve a Fiduciary’s Duty of Care

Most people are aware of the fact that attorneys have a fiduciary duty of care to their clients. However, few people are aware that that same duty of care is available in the context of financial services. Choose a planner who is a fiduciary and earns a fee as opposed to a commission.  

Our CERTIFIED FINANCIAL PLANNER™ Professionals are laser-focused on advancing your financial interest, meaning we refuse to accept commissions from investment service or product providers. The end result is comprehensive financial planning that builds your financial nest egg with the best securities and tools available as opposed to those that add to our own bottom line.

a graphic depicting synonyms for the word detailedEveryone Needs Comprehensive Financial Planning

Even if you are in debt or have no savings, you will benefit from financial planning.

Alternatively, if you don’t have any money available for investing, there is no sense in paying for the services of an investment management specialist. Meet with a professional for comprehensive financial planning and this professional will help develop a roadmap to financial success, setting the stage for you to tap into the expertise of an investment guru.  

Even if you are just starting out in life, deep in debt, or suffered a significant financial setback that leaves you without money for investing, you will greatly benefit from comprehensive financial planning. Our CERTIFIED FINANCIAL PLANNER™ Professionals perform deep dives into clients’ finances, making decisions based on a detailed modeling of each individual’s distinguishing financial situation.  

We provide active investment management yet we also provide additional components of financial planning for those who aren’t yet ready to invest or simply lack the savings necessary to invest. Meet with an investment advisor on our team and we will develop a financial plan for success that is uniquely yours.

 

Get started today by scheduling a meeting to discuss your long term financial goals.

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More About the Author: Michael McGervey

Michael serves as a resource to executives and business owners, assisting them in making proactive and informed personal financial decisions. He is also a member of McGervey Wealth Management’s Investment Committee and is responsible for investment research as well as the execution of the firm’s portfolio strategies.