I'm considering moving home and would like some independent advice on my options based on my current and future finances.
I've always taken advice from family and friends or worked things out myself - however, I think my current situation needs a professional opinion. It involves buying and selling property and family planning.
How do I find a reputable financial advisor? How much can I expect to pay? Will they just tell me what I already know?
Thanks.
If its mortgage advice your after then no I dont think they can offer anything these days. They used to have access to better offers but not any more.
If you think you lack expertise in pensions and investments then yes I think they are a good idea. However there appears to be a very gray area around tax efficient advice, which I know when I have spoken to a FA they have said that I would need to speak to a tax accountant.
At the end of the day they offer a service at a price. To me they offer vfm so that I dont spend hours and hours researching stuff, but others may have the time to do that...
As to choosing, not a clue....
IME there's two types :-
the cheap ones who will ALWAYS try to sell you something as it's the way they make their money (via commission)
the expensive ones who you pay a flat rate to so they don't try to sell you something you don't need
The best experience I've had is with a "financial planner" - of the second type above- who went through everything I've got, my (rough) idea of how I want to live in my older years and then came up with a way of achieving that.
i slightly disagree with FD in that the right mortgage broker can find you a special product if your needs arent straightforward.
In terms of investing, I would always DIY, but then you wouldnt get mechanic paying to have someone else change his oil.
Where a FA can find a product that wouldnt normally be available to you, I reckon they can be quite useful. I have the name of a very good broker if you need one. There's also a guy in here who might pop up in a minute too.
Brakes, are you sure you've thought this through properly? What's the first thing any financial planner is going to say? "Stop spending so much money on bikes." I'd be very cautious about going down this route!
Stoner I sort of see where your coming from a some will have more expertise on sub prime or lettings etc. (although I cant beleive how incompetent some of the proclaimed sub prime 'experts' are)
I was meaning that FA's can now no longer get access to cheaper rate deals than memebers of the public can like they used to. Ok they may know where to look to get the best deals or if you have a specific requirement, but in terms of deals themselves they can no longer get a preferential rate.
"Where a FA can find a product that wouldnt normally be available to you" - This doesnt exist any more.
yep - I was thinking more of development loans, "un-mortgageable" building fabic (like those post war concrete clad ones), flats above a restaurant etc etc.
it's pretty short term really (3-5 years) and more financial planning than anything related to pensions or investments, or even mortgage advice.
I have weighed up the options regarding selling and buying, selling and renting, renting and renting, etc. I've worked out income and expenditure over the next 3-5 years and just need to know what the right choice is that will give me the enough money in my pocket now and in the future.
"I've worked out income and expenditure over the next 3-5 years and just need to know what the right choice is that will give me the enough money in my pocket now and in the future."
They wont tell you that, thats the bit they always leave up to you and it sounds like you have done most of the work.
If a FA rebated some of the commission he/she earned then you could a better, but that is very unlikely to happen.
I would not bother with a FA for mortgages or vanilla savings products.
I have never had enough money to put into investments as such so I don't know which way I would go. I probably know enough from work to be able to choose myself a reasonable deal though.
Luckily I have always had half-decent occupational schemes available at work so that has been a bit of a no-brainer as well.
However, I do feel sorry for anyone who can only pay a smallish amount into a private pension and seeks financial advice as most of the early contributions to the scheme end up in the pocket of the adviser!
The Retail Distribution Review will make things more transparent, aye, right!
Are you part of a union or anything? Some offer free financial advisors... My missus is a teacher and the financial advisor we get via her union (from a company called The Wesleyan) is absolutely superb. We really wouldn't be without his advice. As someone mentioned above, simply for the fact it saves you hours upon hours researching stuff yourself I'd be willing to pay for the service we get.
The fact its free = massive bonus.
Some IFA's do offer a rebate on commision. I work for one that does (I'm not an advisor thou)
FunkyDuck - There are still a good number of lenders out there who do not accept business directly from the general public and we do sometimes find these rates are cheaper than the high street schemes plus some of them will still do the weird & wonderful if a clients circumstances are not straight forward, although what the client may view as straight forward may not be viewed as such by the lender!
Some of my industry colleagues are incompetent when it comes to what is right & wrong for the client but all advisors should offer a free initial consultation so the client can see what the advisor is like. If the client doesn't like the advisor or trust what they are saying then they can always walk away.
A lot of the time lenders won't publish their criteria on the public website so it's very difficult for the client to tell if they are going to fit with a lenders criteria or not and as most of the staff who work for lenders in customer facing roles are targeted on sign ups rather than completions the client won't find out for a good few weeks in some cases whether or not they fit the chosen lenders criteria. A good independent advisor should be able to identify this BEFORE submitting an application.
All of the above is true for the mortgage market. If you are looking for advice on investments & pensions thats a different area but the advisor MUST disclose how much the advice is going to cost BEFORE you commit yourselves to using them. If they won't then walk away.
The best way of finding a good financial advisor is word of mouth. We use an external firm if any of our mortgage clients want pension/investment advice. If you want me to pass your details on to them so you can have an initial chat then email me. It's in my profile.
Good luck
As with some of the above, my mortgage advisor was useless. He admitted after about two meetings that the deals I'd found with judicious use of Google and reading newspapers were better than the ones he'd got.
Daveyboywonder - Wesleyan are not free. Their advice is free but any product you purchase is not.
I've got a really good financial advisor - doesn't charge for many things (like mortgages where he gets commission) but does charge for some others. He is completely up front about all of it.
He helped us get our mortgage, despite it being with HSBC who wouldn't deal with him and wouldn't pay him commission. Even afetr it was obvious that he wasn't going to be able to make money from helping us, he still did. As a result I'll always use him from now on, and will be happy to pay when necessary.
There are good ones who aren't going to rip you off or sell you old rope - but you need to find them...
I wouldn't bother with an IFA for a mortgage, I think you'd do better without the additional link in the chain. I'd love to find a good one....every single one I've dealt with has been hopeless.
It's an industry with a poor image, and deservedly so IMHO.
ok, I'm not looking for a broker or mortgage advice, just someone who can look at my proposed options and tell me which makes the most financial sense.
So they need to have an appreciation of house price movements and mortgage rate changes over the next 3-5 years and also to check whether I am missing anything in my sums.
So they need to have an appreciation of house price movements and mortgage rate changes over the next 3-5 years and also to check whether I am missing anything in my sums. [i]
Blimey... you don't need a Fin Advisor, you need a Fortune Teller!
Every paper you open has Financial Experts offering differing views on the above, so you could take any advice with a pinch of salt!
If its mortgage advice your after then no I dont think they can offer anything these days. They used to have access to better offers but not any more.
Yes, yes they do. I know of one who can offer me a better deal from 4 lenders than if I go direct to them plus there are those that will not deal direct with the public as mentioned above.
A good IFA can be worth every penny of their fees but (IME) not all of them are good. I know a couple that I trust implicitly but several others I'd stay away from.
"So they need to have an appreciation of house price movements and mortgage rate changes over the next 3-5 years and also to check whether I am missing anything in my sums."
Your asking for the Holy Grail there. I refer to my previous response no FA will forecast the future for you. They make give you what they think their gut feelings are, etc etc but in reality they no not much more than you or I about the future.
What they can tell you is if for example if you have £50k, what the best product is at this moment in time to give you 'x' return in 5 years time based on projections etc... with the caviet of it can all go tits up and dont blame me. They are also pretty good at looking at what for your given income and lifestyle etc what sort of investments you could make, or where you should be looking to spend. They are not accountants though, which is kind of what your last comment moves towards.
Nobby - I have spoken to a family member who works for Natwest who says he cant, a family IFA friend who has jacked it in because he says he cant, Wesleyan who say they cant. I didnt really think it was asking many more after that....
I wasn't having a pop or owt FunkyDunc - a friend can get me a 5 year fixed deal from my existing lender below the best that bank can do for me direct. They also have deals from others that cannot be obtained direct.
I don't think it's the holy grail that I'm looking for, it's just intelligent informed comment and a bit of gap analysis.
.
maybe I should bare all on here and ask the STW masses for their opinion.
FunkyDunc - Member
Daveyboywonder - Wesleyan are not free. Their advice is free but any product you purchase is not.
Sorry but I can't remember ever paying them a penny for anything. We've arranged all kinds of critical illness cover, our mortgage, ISAs etc through them and are 100% happy. Saving us an absolute packet.
FWIW, check out their financial products. They do an ISA which is making us, frankly sh*t loads of interest over what the banks were offering...
My wife's an IFA, mostly mortgages and pensions. I think she's one of the good ones..
She's honest, goes a long way to helping folk out as best as she can, works hard for her customers and always does right by folk. It's got a lot to do with her personality- she's not in it to make as much money as she can but I know there are some that are rotten at their jobs and don't really give a monkeys about their customers as long as they get paid!
I may be biased obviously.. Word of mouth prob your best bet for finding one, or the work/union route is good too.
did our mortgage through an IFA and it was a godsend, it was an unusual build new flat and we had barely enough deposit. Our IFA went round all the providers he could come up with and only one actually agreed to take us on. I would hate to have done the leg work myself.
in terms of fees ours was paid a lump sum £200 i think and had some commision too. He said most of the mortgages he deals with he doesnt charge the lum some but we we only spending pennies compared to his usual clientele!!!
The guy I used was the one my dad had so no ideas on where to get one
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