Financial Advice
What is financial advice?
This may seem an obvious question, but in reality financial advice covers many areas and can encompass much more than just helping you make decisions about your money. Effective planning of your finances can help you meet your goals in life, to give you the financial means to help you achieve your aims in the short, medium and long term.
A financial adviser can help you:
- Plan your financial aims.
- Devise a means for you to achieve those aims.
- Choose ways of saving or investing your money that suit your needs.
- Make informed financial decisions.
What areas of my finances will a financial adviser help me with?
Of course, everyone’s circumstances and requirements will be different, but a financial adviser can offer help in many or all of the following areas, by:
- Managing your investments.
- Managing your other assets.
- Minimising the amount of tax you have to pay.
- Discussing your aims in retirement and how these will be achieved.
- Working out an effective means of repaying any liabilities, including your mortgage.
- Discussing how much risk you are prepared to take with your money to achieve your aims.
- Providing peace of mind to ensure that your family will not suffer in the event of your death or serious ill health.
- Making plans so that after your days your children are not burdened with unnecessarily large amounts of tax to pay on your estate.
How does it all work?
There is a specific process that will be undertaken by your financial adviser. He or she will:
- Discuss your aims in life.
- Gain sufficient information about your current circumstances (eg income, assets, dependents, etc) to enable them to have a good understanding of your situation.
- Quantify the difference between where you are now financially and where you want to be at various stages in the future.
- Discuss what level of risk you would be prepared to take with your money in order to achieve your goals.
- Prepare a plan of how you might best achieve your objectives.
- Identify appropriate insurance, savings or investments for your circumstances.
- Implement your plan, with your agreement.
- Review and amend your plan in the future as appropriate, when your circumstances or economic conditions change.
What is ‘Independent’ Financial Advice?
An Independent Financial Adviser (commonly known as an IFA) is someone who is able to recommend which financial products would suit your needs from the entire rnage of products that are available. There are other financial institutions that provide advice, like High Street Banks for example, and there are Advisers who are not classed as "Independent", but both of these advisers will be limited in the range of products they can advise on to to meet your financial goals in life. An IFA also has to be able to offer the option of being paid by you via a fee.
How much does independent financial advice cost?
Independent Financial Advisers will offer you the option to pay for their services by fee (for example at an hourly rate or regular monthly payment ) or may offer the alternative of paying for their services indirectly via the commission that the adviser is given by the providers of any financial product(s) they may set up for you. There may be the option of part fees and part commission, but your IFA should make it clear at the outset exactly what your options are before you commit yourself in any way.
What are the benefits of quality independent financial advice?
Good financial advice can benefit you in many ways. It can provide:
- control over your finances.
- a realistic view of your future finances.
- information about your finances that you can refer to.
- an awareness of the potential risks to your financial future.
- flexibility to alter your financial strategy through the review process.
- an ongoing working relationship with an expert adviser (rather than a salesperson) who can help you achieve your aims in life.