UK Financial Advisor

What do I need to know about a UK Financial Advisor and whether they are qualified to give me professional advice?

Good financial advice can really help you achieve your goals. Should you want to set yourself up for a comfortable retirement, need to take out a mortgage to buy a house or maybe protect yourself and your family's finances should you lose your job or become ill. A financial advisor should be able to prioritise and understand your financial needs, then recommend any products or actions you can buy or take to help you.

There are three types of advisor, tied, multi-tied or independent. Tied advisors are only able to sell products to you from one company. A development of this is the multi-tied advisor, who can only choose from a panel of providers, but still don't give you the full benefit of the market. An independent financial advisor can advise you on products from the full range of companies on the market. The independent financial advisor should give you the best advice for.

Allfinancial advisors do actually need to earn a living. Thus, they will charge for their services using commission or fees, or a combination. A fee is a fixed amount, maybe an hourly rate or depending on how complicated your advice needs are. Commission is taken from the value of your product and paid to the advisor by the product provider. The advisor should tell you what the commission is. You pay VAT on fees, but not on commission. Recently, the FSA stipulated that an advisor has to charge a fee for all advice, which could be taken out of the commission, the rest of which is rebated to you.

Under the FSA Act 2000, the FSA regulates all advisors. The FSA keeps a Central Register, which you can use to check up on a firm.

Should you feel that you have received bad advice, all companies should have a complaints procedure of their own. Should this not solve the problem, you should approach the Ombudsman. Any mortgage advice is covered under the Mortgage Code.

Your solicitor or accountant may be authorised to act for advice, but you should check their level of expertise should the product be complicated. Your mortgage consultant may also be able to offer full advice. They will tell you if they are.

Some people feel that they should use the mortgage advise offered by their estate agent. This person may not provide the best service, and you need to check what range of products he or she chooses from and whether they are truly independent.

You should understand there are numerous ways of achieving your objectives. You may receive different advice from different people. You should choose the investments that you are most comfortable with.

 

 

 

 

 

 

 

© AskFinancially.com 2008

Life Insurance

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