Good Financial Advice and How To Spot it

A recent survey by the research house Platforum found that whereas around a third of consumers claimed to use financial advisers, in reality only around 8% actually do. Clearly there is a disconnect between what the average person thinks is Financial Advice and what actually is

– so how do you tell the difference?


How often do you see your financial adviser? If the answer is ‘When something comes up’ or ‘when I need to’ then the chances are you aren’t receiving financial advice. If you only see an adviser when you are confronted with a specific circumstance or challenge (buying a house etc.) then you are being provided – at best – with guidance or ad hoc advice that deals with an isolated issue.

The difference may seem semantic, but it is actually vast. Good financial advice should involve planning for your future and regularly reviewing those long term plans, which can’t be done with the occasional meeting structured around a major life event.


Because you’ll see your financial adviser regularly, they’ll be able to provide you with the helping hand you need to navigate difficult times. Someone providing you with help because you’re getting divorced or are dealing with the death of a loved one is unlikely to be able to provide that support if they don’t know you. Certainly they will be able to provide guidance on the facts, but they won’t know the personal details that make these events so difficult, nor the impact these events will have on your personal goals. A good financial adviser will have invested the time to get to know you, your goals, personal circumstances and objectives for your finances through a detailed fact finding process.


Because a Financial Adviser has a relationship with you, they can spot opportunities which match your preferences, goals and needs. They can proactively recommend these to you as and when they arise, ensuring that you never miss out on a suitable investment, and helping to make your financial plans as solid as possible.


A good financial adviser will use their relationship with you and their knowledge of your appetite for risk, assets, goals and so on to guide you away from making potentially costly mistakes in your investments. Things which seem attractive to the average person can actually be extremely risky, while apparently ‘safe’ investments can lose you money over time. A financial adviser will use their expertise and sophisticated modelling tools to pick out the investments which are most suited to you and which (on the whole) maximise your protection under the Financial Services Compensation Scheme (FSCS).


Making and saving money is one thing, but without appropriate planning and structuring, you can lose thousands in taxes. A financial adviser will be able to guide you in ensuring that all of the applicable tax reliefs and allowances are used each year, allowing you to maximise the efficiency of your portfolio.


Projecting returns, costs, inflation and what you might need in the future is almost impossible for most people. Financial advisers use their training and expertise as well as a wealth of sophisticated modelling tools to achieve all this on your behalf, ensuring that the only effort you need to make in your plans is sticking to them. This can help you stay focussed on the goal/s ahead by seeing the forecasted results in front of you.


And speaking of sticking to plans, a financial adviser will help you to do just that in a variety of ways. Regular appointments will help in monitoring your economic behaviour and reinforcing the positives while helping to eliminate the negatives. They’ll also ensure that the plans you make are realistic and achievable, and help to adjust them over time in line with changing circumstances. Saving is hard, but the benefits are always worth it.


Finances are complicated, but with a financial adviser, planning them needn’t be. Your adviser’s relationship with you means that they will be able to cut through the mountains of jargon and the complexities of the markets and tell you what really matters. After all, you don’t need to understand the entire financial market, you just need to know what to do to get the best out of it for you.

In conclusion

It’s small wonder that the majority of wealth in the UK is concentrated in such a small percentage of the population when as few as 8% of people are actually investing the appropriate time and effort in their financial futures. Figures show that more and more people are looking at pension shortfalls, and with an aging population and rising inflation, those numbers are set to get worse without serious remedial action.

Financial advice is like any other form of “insurance” – it’s best not to wait until you need it before you go looking for it.