Investment Manager vs. Financial Planner: What’s the Difference?

Investment Manager vs. Financial Planner: What’s the Difference?

If you are getting close to retirement, you might hear two job titles that sound almost the same: investment manager and financial planner.
Both help with money, but they solve very different problems. Knowing the difference can help you choose the right help and avoid paying for services you don’t need.

What an Investment Manager Does

An investment manager looks after your accounts like RRSPs, TFSAs, or non-registered portfolios. Their main job is to decide how your money is invested and make changes when needed.

Before they invest, they will usually give you a risk tolerance questionnaire. This is a discussion and set of questions to find out how comfortable you are with market ups and downs. Your answers guide how much of your money goes into safer investments like bonds or growth investments like stocks.

Example:
Susan, 58, has an RRSP and a TFSA but hasn’t checked them in years.
She worries about losing money if the market drops just as she retires.
An investment manager reviews her accounts, checks her risk tolerance, and adjusts her portfolio to better match her age and comfort level.
Now she knows someone is watching her investments every day.

Typical Costs in Canada:
Most investment managers charge a fee based on a percentage of the investments they manage. It’s often around 0.5% to 1% per year of the total account value.
For example, if you have $500,000 invested, the cost might be $2,500 to $5,000 per year. The fund company will also charges a cost. The costs may be separated or included in the MER(management expense ratio).

What a Financial Planner Does

A financial planner looks at your whole life, not just your investments. They help you answer questions like:

• When can I retire and still live the life I want?

• How much income will I need each year?

• How do I lower taxes on RRSP withdrawals, CPP, OAS, or a business sale?

• Should I pay off debt, save more, or spend on experiences?

A good planner doesn’t just run numbers. They will talk about your values and goals—the things that bring you happiness and purpose. This might include family, travel, volunteering, or part-time work. By understanding what matters most, the planner creates a retirement plan that supports both your finances and your well-being.

Example:
David and Marie, both 60, have RRSPs, a paid-off house, and a small business they plan to sell.
They want to retire at 63 and travel every winter.
A financial planner explores what will make them happiest, runs retirement income projections, and shows a tax-smart way to draw from RRSPs and TFSAs.
They leave with a clear plan that matches their values, not just their bank balance.

Typical Costs in Ottawa:
Financial planners may charge a flat fee for a plan (often $2,000 to $5,000), an hourly rate, or an ongoing advice-only retainer (for example, $150 to $250 per month).
Some planners also offer investment management, but many advice-only planners charge only for planning and do not sell products.

Choosing the Right Help

Some Canadians hire just one professional. Others use both. The choice depends on your needs:

• If you need someone to manage and monitor your investments, an investment manager is the right fit.

• If you need a complete retirement plan that connects your money to your values and happiness, a financial planner is the better choice.

• If you want both the plan and the day-to-day management, you may work with both; just make sure you understand the costs so you’re not paying twice for the same service.

Retirement is more than numbers on a page. Whether you hire an investment manager, a financial planner, or both, the most important step is to choose help that keeps your money working for you and supports the life you want to live.

Ready to Plan Your Next Step?

If you live in Ottawa or anywhere in Canada except Quebec and want a clear, objective plan for retirement, I offer a free 45-minute planning review.
We’ll talk about your goals, your values, and what matters most to you without any pressure to buy products.

If I don’t see it, did I really spend it

It is common to hear the advice, save up for it before you buy it, but we live in a world of instant gratifcation and the deck is not stacked in our favour. You often get hit with ads buy now, pay later or there are only two left, or my personal favorite, you will never see this price again (It’s my favorite because three weeks later you see the same price again.). There are points programs on credit cards rewarding our spending with free groceries or free travel. The average balance on a credit card in Canada in Q4 2024 was $4681 and delinquencies are on the rise.

Why the points programs? The credit card companies are for profit organziations so if they are giving you something for free, is it really free? Credit card companies know two things:

1. Usining a credit card means you will spend more than if you paid cash(one study found it to be 160%more).

2. You are twice as likely to make an impulse purchase using a credit card then using cash.

The reasoning is simple, when you pay with a credit card, you feel less pain. Should you stop paying witrh a credit card? Not necessarily. The trick is to trigger the same pain you would feel if you paid cash. The four suggestions I have are:

1. Remove apps from your phone that you make purchases from. It places an extra step to make the purchase. You need to log into your laptop or desktop to make the purchase.

2. Immediately after you make the purchase, make the payment. This way you get your points, you don’t need to carry cash, and you still feel like you spent money.

3. This is my recent discovery and what prompted this blog, use a credit card that shows up on your online banking profile so that everytime you log into online banking, you see your balance. If your credit card is separate, you can avoid looking at it until the bill comes due and it allows the balance to creep up without you feeling it.

4. If you are making a purchase that isn’t a necessity, contribute the same amount to your investment account. This gives you confidence that you can afford the purchase and reward your current self and it also looks after your future self.

We live in a world of ease and comfort and it is usually a good thing. Spending painlessly is not good and can, and is leading to cashflow and debt issues for many Canadians.

Need help getting your cashflow under control, book an hourly seesion we can review it together.