Financial
Financial advisers
Where do I start?
Getting good, professional financial advice isn't rocket science but
you must do a bit of homework in order to achieve this. We hope to assist
you In this section. This is so important when you are divorcing as
sound financial advice can set you on the right path towards a more
secure future. This is like a reality check; translating your various
life choices into real numbers and considering how much money it is
going to take to achieve these goals.
This could involve selling your home and starting a new life or taking some of the equity out of the home, starting a pension, ensuring that you are covered by insurance, paying university fees or changing your career path. We all have dreams but sometimes it takes a life-changing event such as divorce for us to seriously consider them.
'All men dream, but not equally.
Those who dream by night in the dusty recesses of their minds wake in the day to find that it was vanity: but the dreamers of the day are dangerous men, for they may act their dream with open eyes, to make it possible.'
T.E. Lawrence
If you are in contact with any of these agencies, please say you found them via Divorce Aid.
A good professional, in return for a fee, can help you put
your financial affairs in order.
He should help you to:
- assess your past and current financial status
- set realistic goals for the future
- recommend a number of strategies to achieve your goals
- help you to research and but good, commission-free products
- help you to make important financial decisions
- prioritise your financial tasks
There are three types of professional financial adviser: independent financial advisers, tied agents and other professionals such as solicitors and accountants who give advice as part of their work.
What is an Independent Financial Adviser? (IFA)
This is the largest group and they are required by law to give you the best, unbiased advice. They are usually paid by the hour or with a flat fee or others give their advice free of charge but then are paid a commission by the company you eventually buy a policy from. You should always ask how much this commission is and when it is payable. Some charge a mixture of fees and commission. But they are not 'tied' to any company. It should also be noted that many specialise in different areas and if you are looking for a wide range of advice you should check with him first and shop around. Alternatively, you could opt to go with a large firm. You should always check out references.
Where can I find an IFA?
For a list of Independent Financial Advisers Tel: 0800 085 3250 or check
out their website at www.unbiased.co.uk
Here you can search by postcode for an IFA according to your topics
of interest and you will be given details of the nearest three to your
address. Having searched, you may be given the option of downloading
a voucher for a free initial consultation. You should, of course check
the validity of this with the representative concerned.
What should I ask at the first meeting?
The Financial Services Authority recommends these five questions:
- How many companies' products do you recommend and why only these?
- What other options could I consider apart from the products you recommend?
- What are the pluses and minuses of this investment?
- How much commission will you get paid for each of these products?
- How long am I locked in for and am I committing myself to making regular payments for a long time?
Are there any warnings?
Yes and these apply irrespective of which type of advisor you choose.
You should turn and run if any of the following apply:
- You are told you must buy now or the deal will not be available later.
- Someone suggests that you put your money into a special deal which they are not able to explain properly and there aren't any proper documents.
- Someone suggests you should put all your money into one investment.
- The advisor tries to get you to sell all your present investments and buy new ones. If this is done to excess, it is called churning. The advisor would get commission for every deal and you would incur costs.
Source: FSA
The FSA has good information on a variety of financial topics. For example:
Get to grips with your money
Are you covered?
Saving for tomorrow
Getting financial advice
Making a complaint
Staying safe against scams
Starting a job
Buying a home
Starting a family
Living on your own
Retiring soon
Managing in retirement
What should be in your financial plan?
Everyone is different, so everyone needs a different plan, especially
when going through divorce. But at similar stages in life, we often
have similar goals and priorities.
See Money
Made Clear.
When you feel overwhelmed by outside circumstances beyond your control, do something positive like getting your paperwork in order. This could be the first step in tackling a larger task. Good legal advice is essential and so too is getting good independent financial advice.
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