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What are Independent Financial Advisers?

Independent Financial Advisers give you financial help through advice and products tailored to your situation and needs, ranging from life insurance, mortgages, car insurance, pensions, all the way to investments.

Why are they called Independent Financial Advisers, and why choose to get independent advice?

IFAs are independent because they are not linked directly to any providers, so they can recommend products from across the financial market. IFAs can offer numerous services, some specialise in a few, such as mortgages or life insurance, and others offer a huge variety of services to suit your needs. By choosing an IFA, you can benefit from unbiased financial advice and recommendations tailored specifically to you and your financial situation.

How many Independent Financial Advisers are there in the UK?

According to Statista, in 2019, there were 4,814 IFAs in the UK. This means there are many choices out there on what one to choose, but don’t let this overwhelm you.

You should research what IFA you choose beforehand, there are a number of ways you can do this from speaking to friends and family and asking for a recommendation. The internet also provides a large directory of IFAs which can help you to quickly find you an adviser in your area. A quick internet search for “IFAs near me” will provide you with some initial information on the IFAs in your area along with providing reviews of their services.

How can I find the Independent Financial Adviser that is best for me?

As you have already done a preliminary search of IFAs, now you can hone in on the one you want to work with. A good place to start would be to check out their website, see what services they offer and if they cover what you’re looking for. Then, it would be best if you learned a bit more about them. Have a look at their about us page and information on their employees, giving you a better view of who you will be in contact with and what the company stands for. If you are still unsure, then call them up and enquire about the service you want. The most important thing to remember is that at the end of the day, it’s your choice; you should pick an IFA that you believe will best satisfy your needs, and doing prior research will allow you to make this choice more easily.

Who regulates Independent Financial Advisers?

All IFAs and nearly 60,000 other financial services firms are regulated by the Financial Conduct Authority (FCA). The FCA’s primary responsibilities are protecting you, the consumer; promoting industry competition; and ensuring the stability and integrity of the financial services market. To operate or enter the financial services industry, firms must meet the FCA’s minimum guideline requirements (or “Threshold Conditions”). These include specific standards. To do this, the FCA has set values, standards, and thresholds that financial services firms must meet to enter or operate in the UK financial market.

How much do Independent Financial Advisers charge?

Financial advisers have to discuss their costs with you before any agreement. Therefore, you will know precisely how much the services they provide you will cost you before entering one and what this entails. These costs are usually charged in three main ways:

Fixed fees

Hourly rates

Percentage of investments

It is good to understand that the costs can differ depending on the services you require and your own individual personal needs.

And there you have it! A small but comprehensive guide to Independent Financial Advisers. We wish you good luck with your search if the team at Red Dot can help you feel free to get in touch.

If you want to know more about our services that Red Dot provide , please visit our services page or contact us on 01558825950 to find out how our advisers could help you.

References

Norrestad. (2020, November 23). Statista. https://www.statista.com/statistics/317905/number-of-financial-advisers-in-the-united-kingdom-uk/

FCA. (2020, September 24). About the FCA. https://www.fca.org.uk/about/the-fca

Crown. (2020). Financial Conduct Authority. https://www.gov.uk/government/organisations/financial-conduct-authority

FCA. (2020, January 14). Promoting Competition. https://www.fca.org.uk/about/promoting-competition

FCA. (2017, December 11). Protecting Competition. https://www.fca.org.uk/about/protecting-consumers

FCA. (2019, September 16). Enhancing Market Integrity. https://www.fca.org.uk/about/enhancing-market-integrity

Ministry of Defence. (2020, September 16). Guidance: Choosing a financial advisor (updated April 2020). Crown. https://www.gov.uk/government/publications/joint-service-housing-advice-office-leaflet-index/choosing-a-financial-advisor