Vance Financial Management - Glasgow

Independent Financial advice – what is it really?

There are situations in life when you have to make difficult financial decisions that can often affect your future. If you do not have the appropriate financial knowledge or experience in a specific area, it makes sense going to a specialist, i.e. an independent financial advisor. 

What is a financial advisor?

There are two official definitions of a financial advisor. According to the European Union Directive on financial intermediation, an independent financial advisor is not associated or linked to any specific financial institution. Their main objective is to provide a client with independent advice on the safe management and protection of their assets.

However, according to the European Federation of Financial Advisers and Financial Intermediaries (FECIF), a financial advisor is a qualified specialist, whose purpose is to protect a client’s assets and ensure their financial security by assessing and analysing their needs with a view to recommending the most appropriate financial products.

Remember that a financial advisor is not a stock broker.

What is the job of an independent financial advisor? What areas does financial consulting cover?

A financial advisor’s role is primarily designed to assist an individual or company in making good financial decisions.. He/she helps to safely achieve your financial goals and future aspirations, for example, they may include:; 

  • investment and retirement planning to retire comfortably and with sufficient income to maintain a specific lifestyle
  • estate and succession planning to minimise inheritance tax 
  • creating an individual financial plan tailored to your specific needs

The work of an independent financial advisor does not have to be limited only to choosing one investment product or solution.Independent advisors provide their services over a longer-term time horizon from, taking care of their clients’ assets in a holistic and multi-dimensional manner – offering the best advice to ensure their client’s financial security.

Suppose you need help in selecting the best and most appropriate Personal Pension. A financial advisor specialising in retirement planning will research the market to find a contract that is not only cost effective, but has access to a wide range of funds that match the appropriate level of risk that you are prepared to take. The Pensions market is highly complex so making the right decisions from day one is critical, and the decision you are making today will affect your future wealth and prosperity . 

Financial advisor – what to watch out for?

  • The way they work – you will recognise a good financial advisor by the way that they compile their recommendations. Recommendations should be formal in the format of a report, covering the reasons why a specific financial product has been recommended as well as the costs. An advisor will assess your financial knowledge and understanding, determine an acceptable level of risk for you, ask about your expectations and financial aspirations, as well as pointing out realistic goals.
  • Transparency – an advisor who discourages you from making your own financial decisions, pressing you to choose a specific product, treat with some caution. Make sure that their recommendations are not dictated by their desire for profit-clarify the charges if you are unsure.
  • Portfolio – the more tools an advisor has to offer, the easier it will be for them to recommend a product that actually suits your needs. So choose a practitioner who is able to offer you multi solutions and is independent.

Find out what a given advisor specialises in or is their advice holistic (looking at your complete financial situation, short and long-term). Check how many years they have been in practice for and what their clients think of them.

Is it worth using the services of a financial advisor?

Researching financial products is a time-consuming and tedious task, especially when your financial knowledge and investment experience is very limited. . Making the correct decisions from the start is critical. Engaging the services of an independent financial advisor who can advise you on a range of financial products, offer you a service that is ongoing and can identify solutions that will allow you to achieve your financial and personal goals will over time add value to your overall financial planning. Remember your needs will change over a period of time and it is important that you have access to a professional who can guide you to make the correct financial decisions. However, in order for you to get genuine benefit from this collaboration, first make sure that you are dealing with a reliable expert. Remember that a professional financial advisor will be guided by the good of the client.


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