SIGNpost : Brief Guide to Financial Advice
Queries to SIGNpost fall into the following areas:
- State Pensions & Benefits 20%
- Social Events/Visit Requests 20%
- Financial/Tax/Insurance Issues 19%
- P&G Pension/Shares 18%
- Care Homes/Practical Support 9%
- Legal Issues 8%
- Computer/IT Issues 2%
- Voluntary Work Opportunities 2%
- Health Issues 1%
- Local Tradesman Requests 1%
As you can see, a significant proportion of queries relate to
financial issues and where financial advice is required, SIGNpost
refers the individual on to an Independent Financial Adviser (IFA) in
their specific area.
You do not need hundreds of thousands of
pounds to potentially gain benefit from talking to a financial adviser.
For those who find themselves inheriting a sum of money, have policies
maturing, have shares they are considering selling or perhaps would
like to know the best way of leaving money for children and
grandchildren, an Independent Financial Adviser can provide a valuable
source of (regulated) information and advice.
However, if your
financial issues relate more to the ability to pay bills and juggling
creditors, rather than maximising income from investments or tax
avoidance, organisations such as your local Citizen's Advice Bureau can
provide you with debt counselling. No matter how bad you feel the
situation may be, there will always be a route out of the problems and
organisations like the CAB (others listed below, at the end of this
item) can provide you with essential support and guidance.
callers to SIGNpost often say that they are not really sure how to
choose a Financial Adviser, what to ask etc. and we thought that
Associates might like to know the initial questions they should ask.
Basically, before seeing an IFA you should ask:
If you are happy with the answers they give you to these basic
questions you may wish to consider using them. If so, they will ask you
to fill in what is called a "fact find" form which provides them with
information about you and your finances and then go to an initial
meeting where you can discuss with them what you want to achieve and
whether they can help you. You can then decide if you like them and
want to use them.
- Whether he or she is tied (works for a specific provider of
financial services and so can only advise on that organisation's
products) or independent (an Independent can provide advice on the
whole spectrum of products). Either is fine but you need to make sure
that you choose the type which best suits your needs;
- If the individual is qualified to provide financial advice.
The most important fact is that only companies, partnerships or sole
traders who have authority under the Financial Services Act are legally
allowed to provide you with financial advice. Any individual or
organisation (even voluntary) that is not regulated under the Act will
be breaking the law if they provide you with financial advice.
are basically 3 levels of qualifications with recent articles in the
National Press strongly suggesting that people use an adviser with at
least the intermediate qualification (SIGNpost can provide you with a
list of qualifications, please call if you would like a copy);
- If they work on a fee or commission basis. Fee based advisers
charge a time based fee, like solicitors and accountants, for the work
they do for you whereas advisers who work on commission get an amount
from the company you invest with which comes directly out of the amount
you invest. Again either is fine but you need to check:
- If fee based - what sort of fee you will have to pay. A fee based
adviser will usually start charging straight away so it's a good idea
to agree a fee up front so that you are clear about how much you are
- If commission based - what sort of commission the adviser will
get against the time they are going to put in as if the commission rate
is higher than the cost of the time you may be able to get some of the
commission back or reinvested. It is also worth bearing in mind that
you still pay the commission even if you buy the financial product
directly from the provider organisation as this is built into the price.
- If they are used to dealing with people like you. Some
advisers only deal with people with a lot of money whilst others have
only ever sold basic endowment policies so you need to be sure that
they have a client base which reflects your circumstances. The easiest
way to do this is to simply ask them how many clients they have who
have investments of roughly the same amount that you are considering.
- If they have an in-house tax capability. With interest rates
low, an adviser who can save you money on the tax you pay is helpful
and no adviser should advise on your finances without taking your tax
position into account.
Should you have any questions about finding
and/or selecting a Financial Adviser you can call SIGNpost between
9.30am and 12.30 pm Monday to Friday on 0800 980 0838. All calls are
There are also several very good guides available on
Financial Advice including the FSA Guide to Financial Advice (call 0845
606 1234), the Money Management Council's Factsheet No. 3 called Where
Can I Get Financial Advice (available on the internet at http://www.moneymanagement.org.uk) and How IFA's Make Money from IFA Promotion Ltd. (call 0800 0853250) All three guides are free.
Counselling - local CAB, National Debtline 0800 8084000 or Consumer
Credit Counselling Service 0800 1381111 - all three organisations offer
free advice and help with negotiating with your creditors.
a list of the dozen or so companies that form the panel we utilise for
P&G pre-retirement courses can be provided via SIGNpost and is also
on this website click here to go there now ».
Whilst none of these organisations are being recommended by either DPS
or Procter & Gamble, and may not be relevant to your particular
circumstances, they will represent a good starting point. However, as
we tell people on our courses, the best route is via a recommendation -
so ask amongst families and friends, and always talk to two or three
IFAs before deciding on the one you want to use.