In our previous blog, we covered the various roles and responsibilities of a financial adviser. 

We covered what a financial adviser does, what to look out for and the stages you should go through in developing a financial plan, unique to your own financial goals and objectives. 

In this blog we cover:

  • Part 1 – When you should consider working with an independent financial adviser
  • Part 2  – Signs you need a financial adviser

Part 1: When should I work with a financial adviser?

It’s a question many people ask when considering their long term financial goals and plans.

It’s important to note, financial advice isn’t restricted to those who currently have a high net worth, hundreds of thousands to invest or a high level of income.

You can work with a financial adviser at any age and any stage of your life. This includes people at the start of their financial journey, those already investing and even people currently in retirement.

Like we just said, you don’t have to have a high net worth; it’s a case of finding the right financial adviser, suited to your situation and goals.

The decision to work with a financial adviser, isn’t one to take lightly. The decision is highly personal and should be aligned to your long-term goals. 

By choosing to work with an independent financial adviser (IFA)r, you’re choosing expertise over chance. Their expertise can help you realise your financial goals and dreams. 

Can’t I just do this myself? Why do I need a financial adviser?

It’s true, the internet provides people with a multitude of options on a self-invested basis. 

Advice can be absorbed from various news and specialist investment sites. 

This is helpful in broadening knowledge and understanding all of the savings, investments and assets classes available. This information can give you some knowledge and a degree of expertise. It may well help you find the right financial adviser for your needs.

What it doesn’t do is give you the knowledge, expertise and understanding an IFA has to offer. This financial knowledge, expertise and experience comes through years of training, exams and experience working with a number of clients, with a varied list of financial goals and objectives.

Finally, not everyone has the time, interest or confidence to manage their finances. In 99% of cases, at the start of a relationship with an independent financial adviser, most clients don’t know the ins-and outs of:

  • The various types of pensions available
  • The difference between growth and fixed-income funds
  • Estate planning and inheritance tax
  • Personal or business protection and associated insurances
  • Capital gains tax (CGT)
  • Protecting assets against the future costs of care
  • Shares more suited to capital growth and those best suited to dividend based income

The next part of this blog, highlights some of the signs you may need a financial adviser.

Part 2: Signs you need a financial adviser

The next part of this blog we cover 4 key reasons you may need a financial adviser.

They are:

  • You’re cash rich, have some savings but none of it is invested
  • You don’t know how or where to invest your money
  • You have investments but are concerned about their performance
  • You don’t have a plan for your finances or estate 

You’re cash rich, have some savings but none of it is invested

There are many people who like the security of letting their money build up in their current and savings accounts.

From a point of view of security, this is understandable. Not everyone feels confident to research, find and make investments themselves. 

So surely it’s better to play safe and keep topping up your savings?

There are two factors to consider here.

  1. Since the financial crash of 2008 interest rates have been low. This is fantastic for borrowers but not for savers. Low interest rates mean low returns. 
  1. Due to inflation, currently higher than interest rates, leaving your money in a low interest account could mean you are losing money every year. If your interest rate is lower than the rate of inflation, the value of your money declines.

If this describes your situation, why not book a no-obligation call or meeting with a well regarded independent financial adviser (IFA) to help understand how your money could work harder for you.

If your money is just sitting in a low interest account, is it likely you have a financial plan for later life? Again, a conversation with an IFA will help you explore your options.

You don’t know how or where to invest your money

Investment decisions can be complex. Knowing where to invest your money can be a minefield for your average would-be-investor.

As we mentioned earlier in this blog, there are a host of online resources to help you learn. There are other platforms allowing people to invest their money themselves; either as a lump sum or on a monthly basis.

The question isn’t always how or where to invest, but why.

Investing is for the long term. Responsible investing should always be based on a plan.

Trying to work out how much money you’ll need for retirement, to buy that holiday home or pay for a child’s education is no mean feat.

Of course, you can try to do this yourself.

But why wouldn’t you enlist the services of an expert to discuss your plans, unique requirements and set a financial plan to help realise these dreams?

This is where wealth planners and financial advisers provide the most value. 

They’ll work with you to build up a picture of where you are currently, where you want to be and what you want your financial future to look like.

You have investments, but are concerned about their performance

As we all know, the value of investments can go up or down.

The value of investments can go down due to:

  • The market correcting or moving from bull to bear
  • Financial and global crises 
  • Fund managers making poor decisions on stocks to back
  • A slow down in a sector where your investments are exposed to

Overall, when done correctly, investing should increase your net worth over time.

People who are self-invested can experience high levels of stress around failing investments. In this instance they are left having to address this on their own. 

Experienced, financial advisers are highly skilled individuals. They have gone through years of training, exams and the more experienced they are (in age), the more downturns, recessions and more they would have experienced. 

It’s true, IFAs charge a fee for their services. But these fees are easily justifiable given the experience they hold. 

They have the ability to discuss and formulate a bespoke financial plan, based on your own life goals. Coupling this with their years of experience, it can be the difference between realising those dreams and not.

You don’t have a plan for your finances or estate plan

We’ve mentioned a financial plan a few times in this blog.

Why is a financial plan so important?

Look at it this way. The most successful sports team over the last 30 years didn’t just show up, lay and win.

They had a plan for each game. 

They had a plan for each competition they were in. 

They had a plan for youth development and new player acquisition.

They had a plan for every element covering the performance of the team

An experienced financial planner or IFA will help turn your finances from pub team to premier league outfit. 

They will look at your current financial situation, and ask about your future financial goals. A good financial adviser will seek to understand potential, upcoming, important life events and how they may affect your plans.

Research will be conducted, recommendations made in line with your goals and the plan will be implemented, with ongoing review and communication.

So how about estate planning?

An experienced financial adviser, with the right qualifications and accreditations  can also help you put together an estate plan. An estate plan ensures your  assets are handled according to your wishes after you die. 

Effective estate planning will also consider the potential costs of long term care, inheritance tax and the impact on the beneficiaries of your estate.

Furthermore, experienced, well respected financial advisers will have access to a range of insurances in the form of personal and business protection.

For example, Life insurance can provide your family with the money to survive should you die earlier than anticipated. 

Looking for a review of your finances? A financial adviser can help

We’d love to hear from anyone:

  • Looking to start their investment journey
  • Requiring a review of their current savings and investments
  • Concerned they don’t have the right protections and insurances in place 
  • In need of an estate plan

If that sounds like you, we’re here to help.

You can call us directly on  01329 550190 or drop us a message via our contact page.