When meeting a financial adviser the first time it’s essential to figure out whether they are the right person to entrust with your financial future.
The way to establish this is by asking the right questions, but what are the key things you need to know? Here are seven things to ask your adviser during the initial meeting.
1. What are your qualifications?
Understanding your financial adviser’s credentials is really important. You need to be confident they possess the qualifications, skills, and knowledge to help you reach your financial goals.
To provide regulated advice, an adviser must attain a Level 4 qualification recognised by the Financial Conduct Authority. Increasing numbers of advisers, however, are going a step further and achieving Chartered Financial Planner status.
Further to this, if you’re looking for advice in specialist and complex areas such as pension transfers, it’s important to find out whether the adviser has qualifications specifically related to this.
2. How much do you charge?
It goes without saying that before you engage with an adviser’s services, you must understand how they are paid. It’s a regulatory requirement for advisers to furnish you with this information before any advice is provided.
Adviser charges are far from uniform. Some charge by the hour, while others collect fixed fees. The majority, however, charge a percentage based on the value of your investment. Your adviser may not be able to tell you precisely what you’ll be required to pay if the fee isn’t fixed, but should be able provide an indication, including any minimum or maximum limits.
3. What are my all-in costs?
The fees you pay for advice are only part of the total costs for setting up and administering your financial plan. You also must factor in other costs such as investment and platform charges.
As charges can directly impact how much your money grows, it’s important to understand how much you will pay in both upfront and ongoing fees. For instance, some advisers may use passive investment strategies, whereas others prefer active managed funds, which are pricier. If the adviser outsources investment decisions to a discretionary fund manager, this can push your costs up even higher.
It's important to be clear that low cost doesn't always mean great value. It's important for you decide whether the adviser's services are set at a fair price.
4. What services do you offer?
It's essential to know whether the adviser can help you with your specific goals. If, for example, you're interested in equity release, you need an adviser with qualifications and experience in this area.
That said, many advisers have working relationships with other professionals, so can refer you to someone else should anything fall outside of their remit.
5. What will our working relationship be like?
This question will give you an insight into how much access you will have to your financial adviser. Knowing how often you’ll likely meet and whether the adviser is available for calls or emails outside of scheduled meetings will help you understand what you can expect from your professional relationship.
This may also sway you as to which adviser you go for, especially if you want flexibility in your communications. Since the pandemic, many advisers are favouring virtual meetings on the likes of Zoom and Teams.
This might work perfectly well for you. But, if you would prefer to conduct your reviews face to face, it’s important to learn whether your adviser offers this.
6. Are you independent or restricted?
As you may or may not be aware, financial advisers come in two types: independent and restricted. Distinguishing between the two is important, as it may affect the advice that you receive.
Independent advisers can recommend financial products spanning the whole of the market, whereas restricted advisers can only recommend products from certain providers. In some cases, they will recommend products from a single company.
That’s not to say restricted advice isn’t right for you, but knowing this from the start will help you determine whether the adviser can cater for your specific needs.
7. What are your values and principles?
Unequivocally the most important factor when building a relationship with your adviser is trust. As you are putting your financial future into this person’s hands, it’s essential to know that they have your best interests at heart.
Trust is most likely to be garnered when you share the same values. Every advice firm will have set of principles that guide their advice proposition. Ask what these are, and consider whether you agree with them.
So, where can I find the right adviser for me?
If you need help with your finances but are unsure where to find an adviser you can trust, Unbiased is here to help. With more than 27,000 regulated financial advisers, mortgage brokers and accountants on our platform, we can match you with the right financial expert for your specific goals. Click below to connect with one today.
