Every industry (including Defence) employs jargon which is familiar to its regular users, but a mystery to everyone else. Financial services is no exception.
We’ve noticed the term ‘financial adviser’ and ‘financial counsellor’ are often confused. That’s understandable because they are so similar. But in fact, they are a world apart.
The term ‘financial adviser’ (also known as a ‘financial planner’) refers to a person who is licensed to offer ‘personal financial advice’ under an Australian Financial Services Licence issued by the Australian Securities and Investments Commission. Such a person is licensed to provide advice on financial products (e.g., superannuation, life insurance, managed funds). A ‘financial adviser’ engages in a commercial process which is usually called ’financial planning’ on which fees, commissions and other forms of remuneration are charged to clients.
The term ‘financial counsellor’ refers specifically to a person who is authorised by the Australian Securities and Investments Commission to offer advice (‘counselling’) to people who are experiencing major financial difficulties. This is always a free service and does not involve product advice and ’financial planning’ in the sense described above. Typically, a ‘financial counsellor’ is employed by a charity and looks after disadvantaged members of the Australian community or people who cannot afford the services of a ‘financial adviser’ due to their financial circumstances.
Should you consult either of the people described above, they are likely to ask detailed questions about your personal financial affairs, including your income and expenses. One of the best ways to get a handle on these is to prepare a budget. You can access our recommended template at adfconsumer.gov.au/budget-calculator/