Before you see a financial adviser
How to check you're getting the right advice
When you see an adviser they should give you the right kind of advice for your financial needs. If they don’t, you may be able to complain.
The financial products that an adviser recommends should:
- be affordable for you
- take account of whether you want to save for the long or short term
- be suitable for the amount of risk you want to take
- take account of whether you pay tax.
If an adviser ignores these points and recommends a product that is not right for you, and you later lose money because of this, you can complain.
An adviser only has to give you the right kind of advice within the limits of what they are qualified to do. For example, if you see a restricted adviser, they will only recommend a suitable product for you from the range of products they sell. A restricted adviser doesn't have to tell you that you could buy a similar product from another company at a cheaper price. If you later find this out, you would not be able to complain.
For this reason, it might be better to go to an independent financial adviser who will be able to look at products from the whole of the market.
If a financial adviser can't find a product to suit your needs, they must refer you to another adviser who can help you. If they don’t do this, you may be able to complain.
Checklist of things to do at your first meeting with an adviser
Here are some tips about things to do at your first meeting with a financial adviser:
- check that the adviser you are seeing is qualified to give you the advice you need
- take notes so that you have a clear record of what was said at the meeting
- ask lots of questions and make sure you understand everything you are told
- take time to think about any decisions or to compare products with another adviser. You don’t have to sign up for anything on the spot
- be prepared to answer questions honestly. A financial adviser will ask you lots of personal questions about your financial plans and personal circumstances so that they can recommend the most suitable products for you
- check that your personal information is kept confidential, and find out whether it is used for marketing purposes.
What to think about before you see a financial adviser
Before you look for a financial adviser, try to work out what kind of advice you need. This will help you find the right adviser for your situation. Here's a checklist of some of the things to think about:
- do you have spare money to invest? Take a good look at your finances to see how much you can afford to save. Make sure you have cleared any outstanding debts, loans or bills first.
- how much risk are you prepared to take with your money? When you invest money, there’s a chance you could lose money on your investment. Some investments are riskier than others but can make you more money if they do well. As a general rule, the longer you invest for, the more likely you are to make money, rather than lose it.
- how long do you want to tie up your money for? The length of time you are willing to invest for affects the types of products an adviser will choose.
- do you want advice on different kinds of investments? For example, ethical or environmentally friendly investments or financial products that invest according to Shariah principles?
- are you looking for advice or just information? You may want someone to advise you what to do with your money or just information about a financial product so that you can make your own choice. Some financial advisers will provide both information and advice.
- do you want one-off advice or advice on an on-going basis? Make sure you are clear about how much the advice will cost you and that you can afford it.