How to get financial advice
Learn when you would need it, why it could help you, and how to find an adviser that is right for you.
Table of Contents
- How to get financial advice
- Why get financial advice?
- Different types of financial advice
- Difference between financial advice and financial guidance
- What to consider before meeting a financial adviser
- How to find a financial adviser
- How to choose a financial adviser
- How do I know if I’m getting the right financial advice?
- Checklist of things to do at your first meeting with a financial adviser
- How much does financial advice cost?
- How do I make a complaint about my financial adviser?
- Get financial advice from TheWealthPoint
- FAQs
How to get financial advice
If you’re unsure what to do with your money or how to make the most out of your finances now and in the future, financial advice can be invaluable.
Financial advice can help you make informed decisions about your money. It can help you to create a budget, save for retirement, invest your money, and protect your assets.
But this is where you might get stuck because there are thousands of different financial advisers offering thousands of different financial products, each with different outcomes.
In this article, we’ll explore everything you need to know about how to get financial advice that is right for you.
Why get financial advice?
Financial advice can be a valuable resource for people of all ages and income levels. There are so many reasons why you might want to seek professional financial advice:
- You need help creating a budget or getting out of debt.
- You want to save for retirement, but you don’t know how much to save or where to invest your money.
- You want to invest your money, but you don’t know what to invest in or how to manage your portfolio.
- You want to protect your assets from estate tax or long-term care costs.
- You’re going through a major life change, such as getting married, having children, retiring, or divorcing.
- You’re purchasing a property.
- You have a lump sum of money, such as a redundancy payout or inheritance.
Your financial journey is unique, and your financial advice should be too. By seeking professional financial advice, you can make informed financial decisions that can help you achieve your financial goals.
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financial advice?
Different types of financial advice
Whether you’re planning for retirement, saving for a deposit on a house, or simply trying to get your finances in order, there’s a type of financial advice that can help. Some of the most common types of financial advice include:
Retirement planning
Retirement planning advice can help you create a plan to achieve your retirement goals. This includes estimating your future income and expenses, choosing the right investments, and understanding your retirement options.
Investment planning
Investment planning advice can help you choose the right investments for your risk tolerance and financial goals. It usually means helping you understand the different types of investments you could make, developing an investment strategy, and managing your portfolio.
Mortgage advice
Mortgage advice can help you choose the right mortgage for your needs and circumstances. It typically includes helping you understand the different types of mortgages available, comparing mortgage rates, and getting approved for a mortgage.
Protection advice
Protection advice can help you choose the right insurance products to protect yourself and your loved ones from financial hardship. This includes life insurance, critical illness insurance, and income protection insurance.
Tax planning
Tax planning advice can help you reduce your tax liability and maximise your wealth. This includes understanding different types of taxes, claiming tax breaks, and planning for capital gains tax.
Estate planning
Estate planning advice can help you create an estate plan to ensure your assets are distributed according to your wishes after you die. This includes drafting a will, appointing an executor, and setting up trusts.
Difference between financial advice and financial guidance
Before we get any further, we need to quickly explain the difference between financial advice and guidance. While financial advice and financial guidance are both services that can help you make informed financial decisions, there are distinct differences between them:
Financial advice
Financial advice is a personalised service providing recommendations on specific financial products or services. Financial advisors typically have a deep understanding of the financial market and can help you choose the right products or services for your individual needs and goals. Financial advice is usually paid for.
Financial guidance
Financial guidance is a more general service that provides information and education about financial topics. Financial guidance providers can help you understand your financial situation, identify your financial goals, and develop a plan to reach your goals. They could tell you about your different options, but they wouldn’t tell you about specific products, or product providers.
Bear in mind not all guidance services are regulated by the Financial Conduct Authority (FCA). This means if you follow their guidance and something goes wrong, you might not be able to make a complaint to the Financial Ombudsman Service, or claim compensation using the Financial Services Compensation Scheme.
You can access free financial guidance through a number of impartial organisations, including:
- Citizens Advice: Citizens Advice is a charity that provides free, confidential guidance on a range of issues, including money. You can contact Citizens Advice by phone, web chat, or email.
- MoneyHelper: MoneyHelper is a government service that provides free financial guidance and information. You can contact MoneyHelper by phone, web chat, or email.
- National Debtline: National Debtline is a charity that provides free and confidential debt guidance. You can contact National Debtline by phone, web chat, or email.
- Money and Pensions Service: Money and Pensions Service (MaPS) has replaced the three existing providers of government-sponsored financial guidance – the Money Advice Service, the Pensions Advisory Service and Pension Wise. MaPS is a free and impartial money and pensions guidance service.
What to consider before meeting a financial adviser
Before seeing a financial adviser, take a moment to reflect on your needs and goals. This will help you find the right person for your situation and get the most out of your meeting.
Here are some key questions to consider:
- What are your financial goals? Are you saving for retirement, buying a home, or funding your children’s education? Knowing your goals will help the adviser develop a personalised plan to help you achieve them.
- How much risk are you comfortable taking? All investments carry some degree of risk, so it’s important to understand your tolerance for loss. The adviser can help you choose investments that align with your risk appetite.
- What is your investment horizon? How long do you plan to invest your money? This will affect the types of investments the adviser recommends.
- What are your investment preferences? Do you have any ethical or environmental concerns? Are you interested in Shariah-compliant financial products? Be open to discuss your preferences with the adviser so they can find investments that meet your needs.
- What type of advice are you looking for? Do you want one-off advice or ongoing advice? Be clear about your expectations so that the adviser can provide the appropriate level of service.
And to be clear, you don’t have to know the answers to any or all of the above questions, a financial adviser can help you figure out what it is you need if you don’t know yourself yet.
How to find a financial adviser
There are a number of ways to find a financial adviser. You can ask friends, family, and colleagues for recommendations. This is a great way to find financial advisers who have already been vetted by people you trust.
You could search online; there are a number of websites that allow you to search for financial advisers in your area. You can filter your search by qualifications, experience, and fees.
You could also contact the Financial Conduct Authority (FCA), the UK’s financial regulator. They keep a register of all registered financial advisers. You can search the register by name, firm, or location.
What are the different types of financial advisers?
There are many different types of financial advisers available, each with their own area of expertise. Some of the most common types of financial advisers include:
Independent financial advisers
An independent financial adviser, like The Wealth Point, is able to provide financial advice on a wide range of products and services across the whole market, including investments, pensions, mortgages, and insurance. They aren’t tied to any particular product or provider. They’re required to act in your best interests and provide you with impartial advice. This means that they can offer you unbiased advice on the widest range of products and services.
Restricted financial advisers
Restricted financial advisers are only allowed to provide advice on a limited range of providers, products and services. For example, a restricted mortgage adviser can only provide advice on mortgages. This is because they have a commercial relationship with the providers whose products they offer.
Specialist financial advisers
There are also a number of specialist financial advisors who can provide advice on more niche topics, such as business finance, inheritance tax planning, and long-term care planning.
Some advisers may be more qualified and experienced than others. So always do your research and choose an adviser who you feel comfortable with and who you trust.
How to choose a financial adviser
Once you’ve found a few potential financial advisers, do your research. Here are some things to consider:
- Qualifications and experience: Make sure the financial adviser is qualified (more on this below) and experienced. You can check their qualifications on the FCA register.
- Type of advice offered: Make sure the financial adviser offers the type of advice you need. For example, if you’re looking for retirement planning advice, make sure the adviser has experience in this area.
- Fees: Compare the fees of different financial advisers. Some advisers charge a percentage of your assets under management, while others charge a flat fee.
- Investment philosophy: Ask the financial adviser about their investment philosophy. This will help you understand their approach to investing and whether it’s aligned with your own risk tolerance and financial goals.
Financial adviser qualifications explained
Financial adviser qualifications are regulated by the Financial Conduct Authority (FCA). All financial advisers must be registered with the FCA – you can check a financial adviser is registered with the FCA by searching the Financial Services Register.
They must also meet certain qualifications requirements. For example, all financial advisers must have the following:
- Level 4 or over of the national Qualifications and Credit Framework
- A Statement of Professional Standing (SPS). This is a code of ethics they need to have signed up for, saying they’ve completed at least 35 hours of professional training each year. SPS certificates must be renewed annually so check your adviser‘s is up-to-date.
This qualification and registration means they meet a particular standard when providing you with financial advice.
There are also further qualifications a financial adviser can have and certain professional bodies that represent them; these can include:
- Diploma in Regulated Financial Planning (DipPFS): This qualification is offered by the Chartered Insurance Institute (CII) and is the minimum qualification required for financial advisers operating in the UK.
- Chartered Financial Planner (CFP): This qualification is also offered by the CII and is the most advanced financial planning qualification you can have.
- Chartered Wealth Manager (CWM): This qualification is offered by the Chartered Institute for Securities & Investment (CISI) and is a qualification for financial advisors who want to specialise in wealth management.
- Diploma for Financial Advisers (DipFA): This qualification, from The London Institute of Banking & Finance, allows advisers to have the designation of DipFA and is also Retail Distribution Review (RDR) Level 4 qualification compliant.
It’s important to note that financial adviser qualifications are not a guarantee of good advice. However, financial advisers who hold relevant qualifications are more likely to have the knowledge and experience to provide you with sound financial advice.
How do I know if I’m getting the right financial advice?
The advice your financial adviser gives you should be applicable to your particular situation. If it isn’t, you could be within your rights to complain.
The financial products your adviser recommends should be based on your individual needs, goals, and risk tolerance. They should also be suitable for your current financial situation and future plans.
Bear in mind the adviser you choose can only give you advice within the limits they are allowed to or qualified to do:
- Restricted advisers can only recommend products and services from a limited range of providers. They don’t have to tell you about cheaper products elsewhere. If you have simpler financial needs and are happy to receive advice on a limited range of products and services, a restricted financial advisor may be a good option.
- In comparison, an independent financial adviser will advise you on the whole of market products. If you have complex financial needs or require unbiased advice, an IFA is likely to be the best option for you. They’ll be able to take a holistic view of your finances and develop a personalised plan that helps you achieve your goals.
If your adviser can’t help you find the right product or service for you, they must refer you to a financial adviser who can help.
Checklist of things to do at your first meeting with a financial adviser
At your first meeting with a financial adviser, you should:
- Check the adviser is qualified to give you advice particular to your situation.
- Confirm whether they’re an independent financial adviser or restricted.
- Ask how much you’ll have to pay for their time and advice.
- Bring along any relevant financial information, such as bank statements, investment statements, and pension statements.
- Be honest with the adviser about your financial situation and your goals.
- Ask questions and get clarification on anything that you don’t understand.
- Make sure that you are comfortable with the adviser and that you feel confident in their ability to help you.
- Take time to digest what they’ve told you; you don’t have to make a decision immediately.
- Ask for a terms of business document if they haven’t already given you one. This should include the following information:
- About the adviser or firm: Their name, address, contact information, and the services they offer.
- About the recommended products: The name, type, and features of the products, as well as any associated fees and risks.
- Your right to change your mind: The timeframe within which you can cancel your purchase of the product without penalty.
- Your right to request more information: The adviser is obligated to answer any questions you have about the product or the key facts document.
- How to complain: The contact information for the relevant regulatory body, where you can file a complaint if you are unhappy with the service or product provided.
- Regulatory status: The name of the regulatory body that authorises and regulates the firm.
- Cost of the service and/or product: The total cost of the service or product, including any fees and charges.
How much does financial advice cost?
The cost of financial advice varies depending on the type of advice you need and the experience and qualifications of the financial adviser. You could also have to pay charges on the financial products you buy.
You can expect to pay from £300 for investment advice, and up to £5,000 for more specific advice like pension advice. Some financial advisers may also charge a fixed fee for a specific piece of work, such as setting up a pension or investment plan.
If they’re going to manage your assets for you, they’ll charge a percentage of your assets under management. This can range from 0.5% to 1.5% per year.
Before you agree to work with one adviser, compare the fees of different financial advisers and make sure you understand all the costs involved with your product or service.
Ways financial advisers can be paid
Independent financial advisers are no longer able to earn commissions on the products they sell, so they must charge fees for their services. This ensures their advice is unbiased and in your best interests.
Advisers can charge their fees in a variety of ways, including:
- Hourly rate: This is the simplest way to charge fees, and it is often used for one-off consultations or simple tasks. In the UK, this is £150 per hour on average.
- Fixed fee: This type of fee is typically charged for more complex tasks, such as developing a financial plan or managing a portfolio of investments.
- Monthly retainer: This type of fee is typically charged for ongoing financial advice and support.
- Percentage of assets under management: This type of fee is typically charged by investment advisers and wealth managers. It’s a percentage of the total value of the assets that the adviser is managing for you.
If the advice you’re getting appears to be free, you aren’t getting independent advice, you’re dealing with a salesperson.
How do I make a complaint about my financial adviser?
If you’re unhappy with the service you’ve received, or if you believe you’ve suffered financial losses as a result of your adviser’s negligence or misconduct, you may be able to take legal action.
- The first step is to try to resolve the issue with your financial adviser directly.
- If you aren’t satisfied with the response from your financial adviser, you can escalate your complaint to the Financial Ombudsman Service (FOS). This is an independent ombudsman that resolves disputes between financial consumers and financial businesses. To make a complaint to the FOS, you must first have tried to resolve the issue with your financial adviser directly. Bear in mind the FOS can only investigate complaints about financial products and services that are regulated by the FCA.
Get financial advice from TheWealthPoint
Financial advice can be a valuable tool for helping you make informed decisions about your money. If you’re considering getting financial advice, contact us today to schedule a free initial consultation with one of our experienced financial advisers. We look forward to helping you toward your financial goals for a more secure future.
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FAQs
Can I get financial advice for free?
You can get free guidance from organisations such as, MoneyHelper, but it’s highly unlikely you will be able to find regulated financial advice for free. Advisers are also bound by FCA regulations when it comes to charging a fixed fee for Defined Benefit Pension Advice, so in some cases they are just having to comply with the rules.
Is it worth getting a financial adviser?
Its worth getting a financial adviser if you are thinking about making big decisions about your finances, investments and future. Like anything, you would always feel more secure speaking to a professional about whatever you were planning on doing. Consulting with a financial adviser will ensure you make decisions that are beneficial to you in both the short and long-term.
Do I need a financial adviser to take 25% of my pension?
You do not need a financial adviser to take 25% of your pension. This refers to the tax-free portion of your pension. You do not need a financial adviser to arrange the withdrawal with your provider, although it may be beneficial to consult one to make sure you’re getting the most out of your pension savings.
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