|
 Financial Advice UK
Getting the right financial advice in the UK is essential for you to maximise your investment returns. If you know what you are looking for, follow the quick links below. The menus on the left will guide you to in-depth financial information and simple online transaction capabilities.
Life Insurance & Protection Income Bonds Investment Funds
ISAs PEPs & TESSAs Pensions Tax Planning
Special offer centre
Alternatively, click here to send us your enquiry and an advisor qualified to give financial advice in the UK will contact you.
Call 01225 428444 for expert financial advice on all types of UK financial products.
Types of financial advice in the UK
There are two principal types of financial advice in the UK:
Financial advice given by UK Independent Financial Advisers ( or IFAs); and
Financial advice given by a "direct sales" person (or a tied agent).
In order to give financial advice in the UK a firm of IFA's has to be authorised by the Financial Services Act. In order to be authorised, its directors, employees and representatives have to be approved as suitably qualified to provide financial advice in the UK.
IFAs can recommend the products of many different companies. In fact, they are obliged by the Financial Services Act to provide financial advice that takes into account products from the whole of the UK market and are required to act in the best interest of their client.
In order to act in the best interest of their client, IFAs must know their client before the can provide financial advice. UK regulations require IFAs to complete a "fact find" (i.e. an analysis of each client's financial circumstances) before financial advice can be given. When recommending particular products, an IFA must supply a "key features" document that will explain any commission and charges, the level of risk and the aims and benefits of the product.
Contrary to popular perception, it is generally no more expensive to buy financial products from an IFA than it is to buy direct. IFAs are a valuable distribution channel for product providers who generally do not want to undercut them. In fact, an IFA often has access to products targeted to the IFA distribution channel that you can not buy directly from the product providers. Some UK providers prefer to sell products though those giving financial advice in order to reduce administration costs. These savings mean that they can offer IFAs special deals which the IFAs can pass on to their clients.
Tied agents may also be qualified to provide financial advice in the UK and do not necessarily provide lower quality advice. However, currently they can only recommend products from a smaller range as a tied agent can give advice only in respect of the products of his employer.
Impending changes to financial advice in the UK
Research has shown that approximately 80% of all consumers seeking financial advice in the UK use a tied source. This would suggest that 80% of all consumers limit their choice to the financial products of the firm to which the agent is tied. Research has also shown that while consumers prefer the concept of independent financial advice in the UK, they are sceptical as to whether this truly exists and, in particular, there is concern that commission payments from providers to advisors distorts independence.
To combat these concerns, the Financial Services Authority has drawn up proposals that will change the way financial advice in the UK can be given. Once enacted, these proposals will enable tied advisers to sell the products of more than one company.
Originally, it was also proposed that commissions should be scrapped and IFAs would receive a fee from their clients instead. This proved unpopular with IFAs and the Consumer Association whose research suggested that only a small percentage of consumers would consider paying a fee for independent financial advice in the UK.
Instead, the Financial Services Authority has opted for a "menu" approach to paying for financial advice in the UK. In essence, the consumer will always be offered a choice of paying a fee or commission. This will be accompanied by clear information on the cost of commissions should the client prefer this alternative.
Astute Financial Advice in the UK
Astute Investor is an introducer to Chambers IFA Ltd. Chambers IFA is regulated by the Financial Services Authority to provide financial advice in the UK. Chambers IFA have anticipated the changes being proposed by the Financial Services Authority and already offers a choice between a fee or commission based service - full details will be supplied as required.
|
