Updated 25 July 2017
Do you really need an independent financial adviser (IFA) in your inner circle? Are you even aware of all the ways they can make your life easier? What’s certain is that they’re not just for the rich, as explained by Scott Mackintosh and Jennifer Davy of Edinburgh Investment Consultants.
There’s a long list of professionals you’re likely to need in life. Doctor, dentist and solicitor would probably be on there, along with surveyor, bank manager and maybe accountant too. Yet the independent financial adviser (IFA) is still seen as something of a luxury. You’ve managed without one up till now – how essential can they really be?
If you’ve ever wondered, just ask someone who regularly sees an IFA to stop using their adviser, and see how they react. The reason is simple: IFAs can do an extraordinarily large number of things, which are difficult if not impossible to do without their knowledge and impartial viewpoint.
Here’s a limited selection of the benefits an IFA can bring.
So where does an IFA fit into your circle of advisers?
Your solicitor is there to help with the legal aspects of buying and selling your home, for example. But this is also a very emotional and financially stressful time, so your IFA can help you sort out the financial implications, helping you make these all-important decisions with confidence.
If you have an accountant, you’ll know that they assist you with the retrospective aspects of your finances – what’s happened to date, and how to balance your tax obligations and so forth. An IFA, on the other hand, is planning for the future – seeking ways to build your investments and pension pot, capturing tax breaks and reducing tax obligations through varying strategies. The combination of accountant and IFA can be a formidable team.
Your bank will provide saving and investment products, but the options may be limited and they won’t show you what the rest of the market can offer. An IFA, however, will help you achieve greater margins over a longer term, often using stock market investments and protection of your portfolio, and can also source the most competitive mortgage options by searching the whole of the market.
Your doctor is there to help you live longer – but how are you going to pay for this longer life? An IFA can guide you through the radically changed pension system and also ensure you’re properly taken care of in your later years, by arranging suitable protection and care cover.
As you can see, a good IFA is a fundamental part of the jigsaw. Once you’ve had one for a while, you’ll wonder how you ever managed without.
Scott Mackintosh is an IFA and director of EIC Limited. He has 20 years’ experience in financial planning for clients and has been runner-up in the Scotsman IFA of the Year awards.