Inaction leads nowhere!

There are many roads to prosperity, my advice is taking the road to action as inaction leads nowhere!

If you have avoided using an advisor in the past, nervous they will judge you, ask for information you don’t know or cost you money you cannot afford, let me dispel the myths.

Working with a Financial Advisor

My job as a financial advisor is to help clients achieve their financial goals. I help them make informed decisions, by understanding their current financial position, filling in gaps and assessing their options.

A good financial advisor should be able to eliminate jargon and tell you what you need to know in comprehensible terms.

They will also challenge you if you say one thing and do another.

Reviewing your financial status

As with any professional consultation, you can expect to go through a well-designed framework for reviewing your financial status.

The financial sector is heavily regulated, and you can expect a professional approach that delivers outcomes right for you and your future goals.

How do you find a financial advisor?

You can find a good financial advisor through recommendations from friends or family. Or check online and then read their online reviews. Recommendations on sites such as VouchedFor, Trustpilot and LinkedIn and Google reviews are a good place to check.

Make sure they are registered with the Financial Conduct Authority?– www.fca.org.uk.

Why do you need a financial advisor?

Here are some examples of the types of advice financial advisors deal with:

1. A customer has worked for several employers and has pensions with each. They have no idea what their retirement pot looks like and what to do with it.

2. Having reviewed their pension funds, a client is concerned there is a shortfall between their target retirement pot and their current projected total.

3. A customer has little understanding of how and where to invest spare cash.

4. Investment needs have changed and an individual needs help in finding the right strategy.

5. People do not comprehend the different financial packages on the market, and which are best for them.

6. An event occurs that makes a client realise their need for financial protection.

7. There has been a life event. This could be a birth, death, divorce, house move or even a lottery win!

What information do you need to provide when meeting a financial advisor?

The first thing to do is create a schedule of all your pensions. Provide suppliers, account numbers and the last statement fund value if possible.

If you have a mortgage, confirm your provider and the current outstanding balance.

Once you have that, outline any protection you have, i.e. life insurance and what it pays out, critical illness or income protection policies.

It would also be useful if you considered:

? When you want to retire

? How much you want in your retirement fund

? What savings you have and what returns you are getting

? Your attitude to risk?– this affects the types of investments that may be right for you.

How long is an initial meeting?

Unless there are particular complications, a typical first meeting lasts about an hour.

It should be quite relaxed; the advisor’s job is to get to know you and collate the required information to complete a comprehensive financial review for you.

After that, you can decide if that advisor is someone you want to work with.

What happens next?

Following the meeting, the advisor will often have a lot of work to do to research your products in more detail.

This will allow them to complete the review and identify concerns and gaps in the customer portfolio.

For example, every customer is asked if they have a will. If not, they will almost certainly be advised to get one. Most advisors have trusted partners who are professional will writers, even if they do not offer the service themselves.

If you run a business, this will require additional attention.

Consider:

? Do you have income protection?

? Does your will (if you have one) reflect what should happen if you were to die or be incapacitated?

The pension funds are reviewed, including costs, performance and options for alternative investments.

An advisor will help you decide if it is right to consolidate multiple pension funds into one or whether your different accounts can meet your needs.

Most importantly, they will tell you what you are projected to receive on retirement against where you want to be. If there is a deficit, they will talk to you about what can be done to reduce it.

You should receive a cash-flow model that illustrates your income and expenditure and what would happen if you couldn’t work for specific periods of time. That helps you understand whether you could manage on a reduced income and the impact it would have on your pension savings.

If you have an interest-only mortgage, your advisor will talk to you about how you intend to pay it off at the end of the agreement.

Do you have to pay a financial advisor?

Given you will be employing a professional consultant, there are costs involved. Often, their fees are incorporated into your financial products. They will declare what these are and how much will be included in your product charges, so you know exactly where you stand. They will also declare how much commission they will earn if they introduce new products to you.

Keeping in touch

A financial advisor must carry out an annual review with you (this is an FCA regulation) to monitor your financial position and update any changes in your?life.

They will continue to ask you if your financial goals have changed: do you want to retire earlier, do you need more money, do you want to increase your investments and more?

I hope this article has been useful and means you have a clearer idea of what working with a financial advisor entails. I hope I have busted some myths!

Do get in touch if you would like to find out more about how I can support you with your financial management.