Should I use a financial adviser or do it myself?

What does a financial adviser do?

A financial adviser can help with many areas of financial planning. This could be anything from setting up a portfolio of investments to saving for retirement or helping you convert your pension into income. 

They can help you pay less tax, offer advice on insurance and help you with estate planning.

A good financial adviser will also help you set goals and put in place a strategy to achieve them.

This can be particularly helpful if you have had a major change of circumstance, including:

• Getting married

• Getting divorced

• Changing jobs

• Having children

• Retirement

• Receiving an inheritance or windfall

How much does a financial adviser charge?

Understanding the cost of financial advice is crucial. Financial advisers typically charge in one of three ways: an hourly rate, fixed fees, or a percentage of assets managed.

According to Money Helper, hourly rates vary widely, from £75 to £350 an hour. The UK average rate is around £150 an hour.

Fixed fees, ranging from a few hundred pounds to several thousand, are often charged for specific services, such as creating a comprehensive financial plan or transferring a pension.

If an adviser charges a percentage of assets managed, expect to pay around 0.5-1% of your total assets annually. 

Your financial adviser should always be upfront and discuss their fee structure with you, before you sign up.

Are financial adviser fees tax deductible?

If you are seeking advice on your personal finances, then your financial adviser fees will not be tax deductible.

However, if you are consulting a financial adviser about your business finances, then they may be tax deductible.

Can I get help paying for financial advice?

Yes, there are ways to offset the cost of financial advice.

The pensions advice allowance allows members of defined contribution pension schemes to withdraw up to £500 a year, three times in their lifetime, to pay for retirement advice.

This withdrawal is tax-free, making it an attractive option for those who want professional guidance without bearing the full financial burden.

However, if you feel you would benefit from financial advice, it’s important not to let fees put you off. For many people the benefits will outweigh the costs.

This could be through:

• Tax savings

• Better investment returns

• Higher savings/investment levels

What are the pros and cons of using a financial adviser?

Hiring a financial adviser comes with both benefits and drawbacks.

Here are some to consider:

Pros of using a financial adviser

• Expertise: Financial advisers bring a wealth of knowledge and experience, helping you navigate complex financial landscapes and avoid costly mistakes.

• Saves you time: Managing finances can be time-consuming. An adviser takes on this burden, allowing you to focus on other priorities.

• Tailored advice: Advisers provide personalised strategies that align with your specific goals and circumstances.

• Peace of mind: Knowing a professional is handling your financial matters can reduce stress and increase confidence in your financial future.

• Trust: Financial advisers are regulated by the Financial Conduct Authority. This means that there are strict protocols for them to follow and protection if something goes wrong.

Cons of using a financial adviser

• Cost: Financial advice can be expensive, and costs can vary.

• Conflict of interest: Some advisers may have a conflict of interest, but they are regulated by the Financial Conduct Authority (FCA), so they should recommend the best products for your circumstances.

• Over-reliance: Relying too much on an adviser can hinder understanding and engagement with your finances.

• Quality variability: The quality of advice can vary significantly between advisers, making it essential to choose the right one.

Can I do my own financial planning?

Yes, you can manage your own financial planning.

With the plethora of online resources, from budgeting tools to investment platforms, many people successfully handle their finances independently. 

For example, if you have a straightforward financial situation, such as having a single income stream and no dependents, it might be feasible to manage your finances without external help.

However, in more complex scenarios, such as navigating tax-efficient investment strategies or planning for a multi-generational estate, seeking professional advice can be invaluable. 

The decision to hire a financial adviser should be based on your comfort level and the complexity of your financial situation.

How to find a financial adviser

Finding the right financial adviser requires careful consideration.

As a starting point, think about what you need from your financial adviser. Friends and family may be able to make some recommendations.

Just be aware they might have different requirements to you.

Another option is to use Unbiased to match you with a financial adviser who is right for you. 

When evaluating potential advisers, consider their:

• Qualifications and credentials

• Experience

• Fee structure

• Reputation

During your initial meeting with a prospective financial adviser, ask questions such as:

• What is your experience with clients in similar situations to mine?

• How will you help me reach my financial goals?

• How do you stay updated with the latest financial regulations and trends?

• Can you provide a detailed explanation of your fee structure?

• How do you ensure my best interests are always prioritised?

Preparation for this meeting is key.

Bring relevant financial documents and be clear about your goals and concerns. This will help the financial adviser provide tailored advice from the outset.

The emotional value of financial advice

Managing personal finances can be stressful and time consuming given the complexity and important nature of financial decisions.

That means getting financial advice won’t just make you better off, it could also improve your wellbeing.

Vanguard's latest 2025 study provides the below insights on how financial advice can add emotional and time saving value:

• Advised clients are less financially stressed than self-directed investors: Advised investors are roughly half as likely (14%) as self-directed ones (27%) to experience high levels of financial stress.

• Advice delivers emotional value to clients through more peace of mind: 86% of advised clients report having greater peace of mind when thinking about their finances, compared with managing them on their own. Advice improves investors’ positive emotions and seems particularly effective at lessening negative emotions regarding personal finances, such as feeling overwhelmed and worried.

• Advice saves clients time: 76% of advised clients say advice saves them time, namely, a median of two hours per week (or over 100 hours per year), from thinking about and dealing with their finances.

So, should you hire a financial adviser or go it alone?

The choice between managing your finances independently or seeking the expertise of a financial adviser is a significant one.

While taking control of your finances can be empowering, financial advisers provide valuable insights and strategies tailored to your specific circumstances. This can be especially useful when facing major life events, like planning for retirement, buying a house or making other big financial decisions.

It's essential to weigh the benefits of personalised guidance against the potential costs and determine what aligns best with your financial goals and comfort level.

If you're looking for a financial adviser, let Unbiased connect you with a trusted professional who can provide expert financial advice tailored to your needs.