Is it worth getting a financial adviser? Read our guide.
The information on this page should not be considered as financial advice. If you are unsure what’s right for you, please make sure you speak to a financial adviser.
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Are you facing a major financial decision like buying a home, planning your retirement, or setting up a pension?
These can be life-changing choices involving significant sums of money. But how do you decide what’s best to do without any prior experience?
A financial adviser can offer professional guidance to help you plan for the future, avoid potential pitfalls and reach your financial goals.
So, is it worth getting a financial adviser? This guide will help you make an informed choice.
Why do I need a financial adviser?
If you’re looking for ways to save or invest, buy a financial product, improve how you manage your money, or plan for later life, seeking financial advice can be a worthwhile investment.
Whether it’s right for you depends on factors such as your understanding and experience, your long-term financial goals and your personal circumstances.
If you’re confused about your options, getting professional financial advice can help with many things, including:
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A good adviser starts by asking you a series of questions to identify your goals and aspirations to create a personalised financial strategy. The process should cover:
1. Your financial goals:
You may be looking to buy a home, save for retirement, fund education, grow investments, manage debt or more. Setting out your financial goals will help a financial adviser tailor their advice to your circumstances and needs.
2. Your current financial position:
You’ll be asked about your current financial situation before an adviser recommends strategies and products that are realistic, relevant, and aligned with your immediate and long-term vision.
3. Your risk appetite
Understanding your appetite for risk enables a financial adviser to find products and solutions that align with your comfort level while still working toward your financial goals.
When should I get a financial adviser?
The decision to seek financial advice is often triggered by life events, such as buying a home, starting a family, inheriting money, a redundancy payment or getting divorced.
If you’ve asked, ‘Why do I need a financial adviser,’ the answer largely depends on the products or services, plus other factors:
Financial planning
Financial advice is as much about future planning as it is about the products or services that might benefit you. For instance:
- You require help and guidance when making a key financial decision.
- You want to get your household finances in order.
- You want to review your financial investments and tax liabilities.
- You need help to understand complex financial challenges.
Money-saving products
Financial advice can help you choose the best products and services to suit your circumstances. From ISAs to Investment bonds, advisers will explore all your options so you can feel confident about your choices.
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Financial investments
If you’re considering shares, unit trusts, or other types of investment funds, you may be confident enough to buy directly through a broker or provider. However, these products can be complex, and you risk missing options or choosing something unsuitable without getting financial advice.
Before you go it alone, ask yourself:
- Do I have sufficient knowledge and expertise?
- Can I afford any financial losses?
- Do I have time for research and conducting regular portfolio reviews?
- Can I take full responsibility for bad financial investments?
If not, professional financial advice may be worth the cost, especially when weighing fees against the potential financial and emotional impact of poor decisions.
Pension options
There are many different types of pensions. Employers often offer workplace pensions with advice or guidance that you could take advantage of. However, personal pension schemes can be more complicated, especially where merging pots and boosting contributions are concerned.
Unless you fully understand how your financial investments, savings and pensions work, it’s wise to seek professional financial advice. Essentially, pensions are long-term financial investments, and you’ll need to be sure the risks align with your personal goals and preferences.
Mortgages and insurance
Some types of mortgages and insurance products can be purchased directly from providers. However, your options may be limited if you do this yourself.
Professional financial advisers often have access to wider range of products and services, and potentially better deals. Whether you choose to buy with or without financial advice is entirely up to you.
How can a financial adviser help me?
The role of a financial adviser is to help your money work for you and guide you toward achieving your goals. They’ll take a holistic view of your current situation, consider your medium and long-term future, and work out the best course of action.
For instance, if you’re seeking advice on accessing your pension, they’ll begin by exploring your retirement plans, then assess how your income needs may change over time depending on factors like mortgage or medical costs. They will then use that information to recommend suitable strategies and products that are tailored to your specific needs.
Ultimately, financial advice can help you in numerous ways so that you achieve your life goals.
What are the benefits of using a financial adviser?
Whether you need help choosing the right equity release product or protection policy, financial advice can be valuable in so many ways. For example:
- You’re far more likely to find an investment product that meets your financial preferences and goals when it’s based on professional advice and recommendations.
- You’ll be able to choose from a broader range of products and options than you’re likely to find on your own.
- You’ll benefit from an adviser’s expertise and experience to help you make complex financial decisions, such as how to prepare for retirement.
- They’ll develop a roadmap for achieving your short, medium and long-term goals.
- They’ll monitor your progress and make adjustments according to performance and your attitude to risk.
- If you have funds to invest or are interested in a self-invested personal pension (SIPP), a financial adviser ensures you’ll get maximum value from your financial investments and products.
- They’ll help you understand your pension tax liability and ensure you take full advantage of any tax reliefs and allowances that are available.
- Reputable financial advisers are authorised by the Financial Conduct Authority, meaning none can accept a commission in payment. This avoids conflict of interest when they recommend products.
Is it worth getting a financial adviser?
Choosing between managing your finances yourself and using a professional adviser is a major decision.
While arranging your finances can make you feel in control, qualified advisers offer tailored strategies and valuable insights for a fee, especially during key life events like retirement planning, buying a home and other significant decisions. Not only that, but advisers also have access to a bigger range of products and services, providing you with more options and choices.
If you’re unsure about taking financial advice, it’s important to compare the benefits with the potential costs and losses you could incur by operating alone. Only then will you be able to determine which option aligns with your financial goals, risk attitude and level of comfort.
Do you need a financial adviser?
If you need help with a major financial decision, our retirement and pension advice service offers impartial advice to help you make the right decision and plan for the future. Speak to one of our friendly advisers today.
