The value of advice: 4 benefits of using a financial adviser

One of the most common concerns about using financial advice services is cost. It’s often because individuals are purchasing intangible items, such as the potential for better investment returns or, sadly, because much of the profession has been tarnished by a few players who’ve not showed transparency in fees.

However, the benefit of taking financial advice runs deeper than simply the potential for better investment returns. Having a personal financial plan created with the support of a professional financial advisor has several important advantages, including your peace of mind and wellbeing.

1. Clear goals

Spending time with an adviser on a regular basis will make you think hard about what you are trying to achieve with your money. Are you thinking of retiring early, helping children with the cost of getting on the property ladder or with university costs? A financial adviser will challenge you to assess your goals and help you create a realistic, achievable plan to help achieve your objectives.

2. Regular reviews

Whether you are someone who likes to look at the value of your investments on a regular basis or someone who prefers to invest and then forget in the short term, a professional adviser will look to have regular updates – typically annually. These regular updates aim to keep track of your finances and understand changes to your circumstances which may affect your goal or changes to legislation which could have significant implications on issues such as tax. We recommend annual reviews with our clients unless a more frequent one is suitable. It’s important that a financial plan reflects the reality of your current situation and needs.

3. Tax efficiency

The UK’s tax system is complex and difficult to navigate and errors in understanding could cost you thousands of pounds in unnecessary tax. It’s also subject to changes each year, and after the year we’ve had, is likely to be amended further. A financial adviser will be aware of the changes and common mistakes or blind spots and will be able to make your finances as tax efficient as possible giving you the best opportunity to reach your goals.

4. Product knowledge

A complex tax system is overlaid with a myriad of product providers, many of which have additional rules in place on how their plan works alongside related legislation. An adviser will regularly review the market and carry out time-consuming research, narrowing down the range of product solutions that are suitable for you and your view of risk. This reflects on of our core beliefs here at fiducia, that financial planning should make the complex simple and that the language used should be straightforward and jargon-free.

How much could you save with financial advice? 

A long-running study by the International Longevity Centre found less than 17% of people saw an adviser between 2012 and 2014 and savers are missing out as a result.

Interestingly, the study (published in July 2017), found that individuals who took financial advice between 2001 and 2007 had significantly higher savings by 2012-2014 than those who did not. Of course, this period included the financial crash of 2008-09 when investment returns suffered significantly.

If we were to look at the impact the current pandemic has had on finances and the value of taking financial advice, the results would no doubt be very revealing.

In summary

In a challenging society where earnings are stretched to the limit, it is vital that people can plan for their own financial security in retirement or for any black swan events that occur along the way, whether personally or on a global scale. The study demonstrated that expert advice provided by professionals delivers real value in improving people’s finances and mental wellbeing.

So, it’s not so much a question of whether you can afford financial advice but more one of whether you can afford not to take it. As financial planners and advisers, our role is not to sell anything but to guide you and solve problems by working to create a tailored financial plan. We look forward to connecting with you and starting this journey.

If you’d like to have a chat about your finances or make an appointment with one of our financial advisers, then please do contact us on 01206 321045 or [email protected]