Dispelling the myths about financial advice

45 percent of people admit they spend more time choosing biscuits than planning their financial future

Why? There is a perception that financial planning is the preserve of the rich and the famous. But successful financial planning can make use of any sum of money. So why don’t more people consult a financial planner?

Research carried out for Schroders Personal Wealth last year by Sonar discovered that 45% of people spend more time choosing biscuits than planning their financial futures [1]. When you consider the potential life-changing effects that financial security can have, from retirement planning through to inheritance tax and estate planning, not to mention allocating emergency funds, this reluctance to consult a financial adviser is a mystery.

There are many reasons why people choose not to take financial advice, but five of the most common reasons include:

• I’m not “wealthy”
• I can do it myself
• I can’t afford financial advice
• I don’t trust financial advisers
• Financial advisers bamboozle you with jargon

Myth 1: I’m not wealthy

There is a perception that financial planning and advice are the preserve of oligarchs, the jet set and celebrities.  It is often associated with complicated tax or residency issues or other complex needs.

But financial planning and wealth management can improve anyone’s financial situation. A successful plan can help ensure your assets work harder and more efficiently to build your wealth over the longer term.

Myth 2: I can do it myself 

Research by Boring Money shows that around half of us do not feel the need to take financial advice [2].  It also revealed that 64% of people are not confident when opening an ISA online, 72% are not confident opening a pension online, and 78% are not confident in choosing their own investments [2].

Meanwhile, online search now allows us to compare any number of offerings from a variety of providers, including financial services. Insurance policies, current accounts and investment funds can all be researched from the comfort of your home.

However, making financial decisions without a clearly thought-out strategy does not constitute financial planning. Looking to buy a second home? Dreaming of a comfortable retirement? Want to retire early? Could your family manage if something happened to you tomorrow?

These are worthy considerations that require considered planning.

Myth 3: I can’t afford financial planning 

According to Boring Money, around a third of savers and a fifth of investors say they don’t think they could afford the services of a financial adviser [2]; while around a fifth of both savers and investors struggle to see the value to be found from seeking professional advice [2]. In most cases, it’s a question of perspective and values.

What price would you put on peace of mind? The cost of good financial advice can start in the hundreds, not thousands, of pounds. At Fiducia Wealth Management, initial consultations are free and after this, as with anything else, the costs will increase in line with the complexity of the service you need and how long you need it for.

Find out how much our financial advice could cost you.

Myth 4: Advisers are incentivised to sell expensive products

This is not true. And if it is, you’ll have likely chosen the wrong adviser. Unfortunately, there have been instances where unscrupulous firms have given the profession a bad name. There is a misconception that advisers are incentivised to sell you specific products and therefore more interested in their commission than your real needs.

Since 2012, regulations have changed the way advisers are remunerated in line with the Financial Conduct Authority (FCA). They no longer earn commissions from selling products but are paid by the client for the specific work they undertake. This makes the financial basis of the relationship more transparent and aims to align their objectives with yours.

As an independent, award-winning firm with Corporate Chartered status from the Chartered Insurance Institute (CII), we are also listed on the FCA, so clients can be confident in our transparency and ethics.

Myth 5: They’ll confuse me with jargon

Historically, the financial management industry has a reputation for confusing people with complex language, over-complicated products, small print and claims that over-promise. But strict regulations have overhauled the industry completely.

We do not believe in bamboozling clients with jargon or burying important information in reports that are too long to read or refer to.

We believe that advice should be relevant, clear and concise, with a fair and straight-forward fee structure.

When we provide financial advice, we put you at the centre. We will communicate to you in plain English and always provide a rationale behind our recommendations so that you can clearly see our reasoning.

Why choose Fiducia Wealth Management?

• We’re built for the future, but through the expertise and continued professional development of our team, we benefit from over 200 years of combined experience
• We are one of only 900 firms across the UK to hold Corporate Chartered status from the CII
• We have been awarded prestigious Gold Standard status in association with Investment Week
• Our team is dedicated to your financial wellbeing and creating confidence for you and your family

With our history and experience in wealth management, along with our trusted team of financial advisers, you can be assured that your financial plans are in safe hands.

If you feel you could benefit from financial advice, then contact us today or visit the website to learn how to arrange a meeting. Your initial consultation is free, allowing you to gain a better understanding of how you might benefit from wealth management.

Sources

[1] Sonar survey of 800 adults across the UK who were asked a number of questions about their finances and lifestyle. The survey was conducted exclusively for Schroders Personal Wealth in August 2019.

[2] Fifty Shades of Advice, Boring money insights, June 2019