You may have enlisted the services of a financial adviser who you think has your best interests at heart. They might have reasonable fees and, by all accounts, they’re seemingly helping you manage your money.
However, it’s possible that you’re working with the wrong financial adviser for you, without you even having realised it. And, if this is your first experience of financial advice, you might not have a frame of reference for why it isn’t quite right.
Here are 10 warning signs to look out for that might tell you you’re working with the wrong adviser for you.
1. They focus on your money and their financial products
The financial planning profession has changed greatly over the years. Previously, advisers would ask you about your money, and then try to sell you their off-the-shelf financial products.
Now, good planners are more interested in your life and aspirations, using your money as the vehicle to get there. They look to help you achieve your goals by learning about what you want, before then offering you the appropriate products and services for your circumstances.
If your adviser starts with the products rather than chatting to you about your ambitions, they might not be the right one for you.
2. They believe their value is in improving returns
Some advisers believe that their function is to consistently supercharge your money by beating the investment market.
Unfortunately, this isn’t true. In fact, no one can consistently beat the market rate of return. There are some high-profile cases where “star” fund managers were able to briefly defy the odds, but even these tend to run their course.
Your planner should be targeting the returns that suit your financial plan, not just the most impressive numbers.
3. They’re tied to one organisation’s products
Many advisory firms can only recommend their own products, rather than looking across the whole market. That includes St James’ Place, the largest firm in the UK. However, this approach may not work for you and your money.
The best planners should be able to recommend from the whole of the market when it comes to giving advice. Otherwise, the products in their arsenal might not be suitable for you, while they’re unable to use the ones that would fit your plan perfectly.
Independent planners and advisers can choose any product or service that they believe would add value to you.
4. They’re not proactive
Some advisers or planners put a plan in place, take their fee, and then leave you to it. But actually, the best results are nearly always achieved by those who proactively keep an eye on their clients’ progress.
Your adviser or planner should always be on the front foot and looking forward, checking you’re on track and correcting your plan where necessary.
5. You don’t feel you’re getting value
Do you feel that your adviser or planner adds value to you and your life?
The reason you pay for financial advice is to see that value. Cost is somewhat irrelevant here; you could be paying less than the standard rate, but not be receiving any value for your money.
If you’ve got a feeling in your gut that you’re not getting value, you’re probably right.
6. They don’t return emails and calls as quickly as you’d like
Your adviser or planner should be there with you, working proactively and communicating with you throughout your relationship.
If your planner doesn’t return your emails and calls as quickly as you’d want them to, you should find an adviser who always responds to you punctually and empathetically.
7. They’re not registered with the Financial Conduct Authority
The Financial Conduct Authority (FCA) is the financial regulatory body in the UK, ensuring that financial service firms play by strict rules to keep customers and clients safe.
You shouldn’t ever work with someone who claims to be a financial adviser but isn’t registered with the FCA, no matter what sort of offer they’re making you.
You can check the FCA register online using a firm’s FCA reference number. For example, here’s the registered page for Cordiner Wealth, with details of the financial activities we’re permitted to do.
8. They’re significantly older than you
You may not have considered the importance of the age of your adviser, but it does matter.
Do you want to have to change your adviser or planner, just because they’re older than you and have sold up? What if you’ve retired and want to change your plan? Or you’re a business owner looking to sell in years to come, and your adviser had got to know your business intimately?
Consider picking an adviser who’s at least a similar age to you. You need someone who’s going to be there for you for the long term.
9. They don’t use cashflow forecasting
Cashflow forecasting and modelling has become a key part of the planning process, giving you a clear representation of how much you have, and how much you need. It helps you picture your financial future based on educated assumptions and scenario planning.
An adviser who doesn’t use cashflow forecasting can never tell you whether you’re on track with enough to achieve your goals. If your adviser doesn’t use this key technology, everything is essentially guesswork.
10. They have poor VouchedFor reviews
VouchedFor is an independent site for clients to rate firms and advisers, based on the quality of the advice, service and value they receive.
VouchedFor reviews are by no means everything, but it can be a good way to find out who you shouldn’t work with. Poor reviews should be an instant red flag.
Get in touch
At Cordiner Wealth, we are financial lifestyle planners who help our clients achieve their goals.
If you’d like to find out how we could help you, please contact us by emailing firstname.lastname@example.org or calling 0113 262 1242.
This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.