Get the facts about ad­vice

The Peterborough Evening Telegraph - - ET Business -

IN last month’s ar­ti­cle I wrote about the NEST com­pul­sory pen­sion scheme and said I would write some more about it in this month’s ar­ti­cle. How­ever, we have now had the emer­gency Bud­get which may af­fect the scheme. I am de­fer­ring fur­ther com­ments things be­come clearer and there­fore I have de­cided to write about how to ob­tain fi­nan­cial ad­vice.

The about-to-be-abol­ished Fi­nan­cial Ser­vices Author­ity pro­duce a se­ries of book­lets un­der the gen­eral head­ing of Money Made Clear, and one of these is en­ti­tled Just the facts about get­ting fi­nan­cial ad­vice. This is a very good start­ing point for those peo­ple who have not used fi­nan­cial ad­vis­ers be­fore, or just want to check on the type of ad­vice they are re­ceiv­ing now.

Fi­nan­cial ad­vice is based on your per­sonal needs and cir­cum­stances, which means that you need to be pre­pared to an­swer ques­tions about your cur­rent fi­nan­cial cir­cum­stances so that the ad­vice is tai­lored to you as an in­di­vid­ual. You should al­ways deal with a firm which is reg­u­lated by the Fi­nan­cial Ser­vices Author­ity (or its suc­ces­sor) as this pro­vides safe­guards for you. Ask for the FSA reg­is­tra­tion num­ber of the firm and/or the in­di­vid­ual you are deal­ing with and check these on the FSA reg­is­ter at www.­is­ter/

You should also check on the qualifications of the ad­viser who should give you a busi­ness card where these are usu­ally shown. There are sev­eral gen­eral lev­els of qualifications and spe­cific qualifications for spe­cial­ist ad­vice. Ask the ad­viser about his qualifications and en­sure that they are ap­pro­pri­ate to your needs.

Check whether the ad­viser is tied or in­de­pen­dent. If he is tied this means that he can only rec­om­mend fi­nan­cial prod­ucts from one or per­haps a limited range of fi­nan­cial providers. Ad­vis­ers from banks are gen­er­ally tied. An in­de­pen­dent fi­nan­cial ad­viser is able to ac­cess prod­ucts from across the whole mar­ket. An in­de­pen­dent ad­viser should also of­fer you op­tions re­gard­ing pay­ment for his ser­vices, which can be fees or com­mis­sion, or, a com­bi­na­tion of the two. Do dis­cuss and agree how pay­ment is to be made and pre­cisely what level of ser­vice is of­fered par­tic­u­larly with re­gard to reg­u­lar re­views.

In ad­di­tion to ques­tion­ing the ad­viser about his qualifications and back­ground within the fi­nan­cial ser­vices in­dus­try, make sure you fully un­der­stand the rec­om­men­da­tions that are be­ing made. Also ques­tions are a way of check­ing that the ad­viser fully un­der­stands the prod­uct he is rec­om­mend­ing.

Do not be ha­rassed into sign­ing ap­pli­ca­tion forms, take time to con­sider these prop­erly and to en­sure that you un­der­stand the prod­uct fully. Go back to the ad­viser with ad­di­tional ques­tions and only sign ap­pli­ca­tion forms when you are com­pletely happy with the prod­uct. There is usu­ally a cool­ing off pe­riod and the ad­viser should tell you about these, but it is bet­ter not to have to rely on these.

Oak­wood Fi­nan­cial Ser­vices has a sup­ply of all the FSA book­lets and if any­one wants copies, we shall be happy to pro­vide these free of charge.

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