If you want to see a financial adviser, it’s a good idea to speak to a few so you can compare the service they offer and find out if they’re right for you. Most will offer you a free initial consultation, where you get the chance to ask some questions. Here’s a few to get you started.
What’s in this guide
- What do you charge and how much am I likely to pay?
- What services do you offer? Are you independent?
- If you’re not independent, can you look at products from across the market?
- Are you an Appointed Representative?
- Do you have qualifications that are above the minimum you’re required to take?
- Do you have many clients who are in a similar position to me?
- Will you give me ongoing advice and what will this cost?
- How am I protected in the event of things going wrong?
What do you charge and how much am I likely to pay?
A financial adviser must tell you how much they charge before you’re taken on as a client. It’s part of the rules that all advisers have to abide by.
Some might charge by the hour, others might charge a fixed fee or a percentage of the value of your pension pot if you want retirement advice or if you want general advice on investments.
But that might not help you work out how much you could end up paying. It depends on factors including your needs and the kind of service you want.
The adviser might not be able to tell you exactly what you’ll pay, but they should be able to give you an indication and perhaps even an upper limit.
For more on this, see our guide Financial adviser fees
What services do you offer? Are you independent?
The adviser must tell you what services they offer, including whether they’re an independent adviser.
The phrase ‘independent financial adviser’ has a particular meaning that’s set out in the rules that financial advisers have to follow.
To be called independent, a financial adviser must be able to offer a range of products from across the whole market and provide unbiased and unrestricted advice based on a comprehensive and fair analysis of that market.
An adviser might be what’s called ‘restricted’ if they only recommend certain types of investment products and/or products from a limited number of providers.
Find out more in our guide Choosing a financial adviser
If you’re not independent, can you look at products from across the market?
A restricted financial adviser who only recommends certain type of products might still be a good option (for example, they might specialise in retirement advice only).
But it’s worth checking that they can recommend products from a wide range of providers.
If they can only recommend products from a one or a limited number, you might not get the choice you need.
Are you an Appointed Representative?
‘Appointed Representatives’ are advisers who can give you regulated advice on behalf of another firm, known as the principal firm.
You’ll be protected if things go wrong with the activities the principal firm allows their representative to do – but you may not be covered if the representative has gone beyond the activities the principal allowed. So it’s important to ask if your adviser is an Appointed Representative and find the contact details for their principal firm.
Do you have qualifications that are above the minimum you’re required to take?
All financial advisers must have some qualifications, by law. The minimum for advisers providing advice on pensions and investments is a qualification called QCF Level 4.
Quite a few advisers have taken additional exams, so it’s worth asking what qualifications the adviser has and what these demonstrate.
Some types of advice require the adviser to have specialist qualifications – for example, pension transfers and equity release.
Do you have many clients who are in a similar position to me?
Some financial advisers will only deal with people who have a pension pot of a certain size, or a certain amount of money to invest (for example, £50,000 or £100,000).
Other advisers are happy to advise customers no matter what the size of their pension fund is.
It’s always worth finding out if an adviser has a lot of experience of advising clients in a similar position to yours.
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Will you give me ongoing advice and what will this cost?
You might not need ongoing advice, but if that is something you think might be useful in the future, it’s worth asking about it and finding out the likely costs.
How am I protected in the event of things going wrong?
When you take regulated advice, the financial adviser will give you a personalised recommendation based on your circumstances and the information you have given them.
This means that you can take your complaint to the Financial Ombudsman Service if you think you were mis-sold a product or recommended something unsuitable. And you will be protected by the Financial Services Compensation Scheme.
