Paraplanning

AAA

DEFINITION of 'Paraplanning'

A relatively new position within the financial planning industry that involves the performance of the administrative duties of a financial planner. This function was created to allow financial planners to focus on the sell-side by working more closely with customers to identify their investing needs.

INVESTOPEDIA EXPLAINS 'Paraplanning'

Paraplanners do most of the grunt work (preparing plans and reports) for financial planners. Some large firms have developed new departments for paraplanners within their organizations, however, the cost of hiring paraplanners is extremely high, and as a result, this option may be unavailable to some smaller companies. This has led to the development of outsourcing companies who provide paraplanning services to companies upon request.

Working as a paraplanner is being utilized also by recent graduates to get a foot in the financial planning industry's door, where they can gain experience and move up to a financial planner themselves later.

RELATED TERMS
  1. Retirement Planner

    A practicing professional who helps individuals prepare a retirement ...
  2. Outsourcing

    A practice used by different companies to reduce costs by transferring ...
  3. Discount Broker

    A stockbroker who carries out buy and sell orders at a reduced ...
  4. Investment Advisor

    As defined by the Investment Advisors Act of 1940, any person ...
  5. Retirement Planning

    The process of determining retirement income goals and the actions ...
  6. Certified Financial Planner - CFP

    The CFP legal team has provided its official definition, along ...
Related Articles
  1. Options & Futures

    Shopping For A Financial Advisor

    Finding your perfect advisor is as simple as shopping for a car. Read on to learn more.
  2. Brokers

    Choosing An Advisor: Wall Street Vs. Main Street

    A high-profile brand name alone won't meet your personal investing needs. This article will show you what else to look for.
  3. Investing Basics

    Paying Your Investment Advisor - Fees Or Commissions?

    The way a professional is compensated can affect quality of service. Learn more here.
  4. Options & Futures

    The Alphabet Soup Of Financial Certifications

    We decode the meaning of the many letters that can follow the names of financial professionals.
  5. Credit & Loans

    How To Become a Mortgage-Backed Securities Analyst

    Specializing in structured or derivative credit products like mortgage-backed securities requires education and prior experience in the mortgage field.
  6. Investing

    What is Asset Management?

    In the investment world, asset management refers to active management of an investor’s portfolio by a financial services company – usually an investment bank.
  7. Professionals

    Are You An FA Looking For A New Job? Read This First

    The choice between a larger or smaller company may be decided by an advisor's experience or temperament. Find out the best size for you.
  8. Professionals

    Why Is Wall Street Dominated By Men?

    Find out why women in the financial industry are still lagging behind their male counterparts when it comes to pay.
  9. Personal Finance

    Mergers and Acquisitions Analysts: What They Do, How Much They Make

    Mergers and acquisitions analysts perform the the analysis and modeling to support buying, selling, restructuring, and combining companies.
  10. Personal Finance

    How You Can Become A Venture Capital Associate

    Venture capital analysts are the junior members of the venture capital firm. They receive compensation that is typically higher than other finance analyst positions.

You May Also Like

Hot Definitions
  1. Risk Averse

    A description of an investor who, when faced with two investments with a similar expected return (but different risks), will ...
  2. Fixed-Charge Coverage Ratio

    A ratio that indicates a firm's ability to satisfy fixed financing expenses, such as interest and leases. It is calculated ...
  3. Efficiency Ratio

    Ratios that are typically used to analyze how well a company uses its assets and liabilities internally. Efficiency Ratios ...
  4. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  5. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  6. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
Trading Center