How to find a financial adviser - Which? (2024)

What can a financial adviser do for me?

You should consider getting financial advice for complex products so that you don't end up with something unsuitable. These include:

  • Pensions and Investments
  • Life insurance and health insurance
  • Tax and inheritance planning
  • Mortgages (via a broker) and equity release
  • Long-term care planning

A financial adviser can scour the market to find investments and products that are tailored to your circ*mstances, and help you personally plan for the things you want to do with your money in the future.

You can still buy complex financial products without an adviser. For instance if you're confident enough you can use investment platforms which offer a range of products, such as stocks and shares Isas and self-invested personal pensions (Sipps), with lower fees.

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How do I find a good financial adviser?

It's really important to shop around when looking for an IFA. A comparison site is a good place to start; Unbiased and VouchedFor are the biggest.

You can use their filters to narrow down a shortlist based on areas of expertise and customer reviews. We recommend setting up meetings with at least three IFAs so you can decide which can provide you the best service for your needs, and the best value for money.

If you don't need to meet your adviser in person, you could save money by looking outside of your local area. For example, VouchedFor data shows that financial planning costs in South East England tend to be higher than in the north.

The following resources can help you find the best adviser for you. It's best to draw up a shortlist of at least three financial advisers and ring them all before deciding on one.

You can also take a look at MoneyHelper's Retirement Adviser Directory.

  • Find out more:Best stocks and shares Isas 2024

Independent vs restricted financial advice

There's an important difference between independent and restricted financial advisers.

If an adviser says they are independent, their advice must be:

  • based on a comprehensive analysis of the market
  • unbiased, with no influence from product providers

Restricted advice

Restricted advisers will either focus on just one subject area, like pensions, but look at the whole of the market, or could recommend investments from all providers, but just for one type of products, such as only recommending unit trusts.

Other types of restricted advisers may give advice on more than one area, but will only have access to a limited number of providers. This means you won't be getting recommendations from the whole of the market.

If you visit a restricted adviser, it is essential that the adviser explains exactly what service he or she is providing to you.

Financial providers can be especially useful for investors who want their money to be invested in a particular way - whether you want to avoid controversial companies, or support firms driving positive change.

It is possible to pick your own ethical investments, but the lack of agreed standards on what makes a fund ethical or ESG means you have to do extra checks. An adviser can do these for you, with more knowledge of the sectors concerned.

An adviser who's specialised in this area should ask you about your ethical concerns and interests early on, perhaps by questionnaire.

Also look for advisers who are members of the UK Sustainable Investment and Finance Association (UKSIF).

Some advisers use platforms, which are online services that feature a range of investments in one place. As long as advisers are using them to benefit their clients, platforms are an acceptable part of independent advice. However, advisers should use more than one platform.

Some advisers use model portfolios. These are pre-constructed collections of investments, a bit like chocolate selection boxes. Each model portfolio meets a specific investment risk profile, so one could be high risk, one low risk and one intermediate.

Before recommending a model portfolio, advisers must ensure each investment suits their client - like making sure you like every individual chocolate in the box.

Independent advisers can use model portfolios, but only once they have considered options outside them. They should not use just one model portfolio.

Alternatives to financial advisers

MoneyHelper, Citizens Advice Bureau and Pension Wise (for the over-50s) provide free and impartial financial guidance.

In contrast, advice from an IFA is a service that will recommend a specific product based upon your personal situation. Guidance will give you information to help you narrow down your choices - read more about free guidance services (including for debt) here.


Robo-adviser or 'do-it-for-me' investment platforms assess your attitude to risk and use algorithms to make recommendations, usually a portfolio of funds.

Although usually cheaper than IFAs, they operate through smartphone apps or websites and rarely offer advice on other aspects, like tax or savings.

  • Find out more:the best robo-adviser platforms

One-off advice from investment platforms

Some traditional DIY investment platforms and robo-advisers are also beginning to offer guidance and restricted financial advice.

ProviderDescriptionOne-off costsOn-going costs
Aviva Financial Advice has pension and investment advice options.
Report fee of £625Between 0.25% and 2%, depending on how much you invest
BestinvestThe investment platform offers two packages: Investing For Your Goals, and the Portfolio Health Check.
Goals service costs £295, health check costs £495n/a
Charles Stanley DirectThe investment platform provides a OneStep Financial Plan where you get a personal consultation with a financial adviser to produce an action plan , and OneStep Financial Coaching for a one-hour coaching session with a qualified financial planner
£150 for one-hour coaching session, £900 for personal consultationn/a
Hargreaves LansdownInvestment advice helps you to choose the right investments, while financial planning helps you work towards a goaln/aInvestment advice (fee of 1%) or financial planning (between 1% and 2% plus VAT), minimum fee of £495
MoneyfarmThe robo-adviser offers fund portfolios that are managed on your behalf with access to a dedicated consultant for fees
n/aConsultant costs between 0.35% and 0.75% - larger portfolios have lower percentage charges
NutmegThe robo-adviser, which is backed by JP Morgan, launched its service in 2018 and offers restricted financial and retirement planning advice.

Note: costs correct April 2023

Which? Money Helpline

For free, impartial financial guidance, Which? Money members can also call the Which? Money Helpline.

With more than 100 years of experience in financial services between them, our team of experts can provide information on a range of personal finance topics, including investment options but also insurance, care costs, tax, savings and seeking reimbursem*nt after a scam.

Financial adviser qualifications explained

All financial advisers will have to have a minimum qualification equivalent to an undergraduate degree, regardless of the type of advice they provide.

All advisers now have to meet QCF level 4 - the equivalent of the first year of a degree.

The Financial Services Skills Partnership has also created Appropriate Exam Standards (AES), which awarding bodies use to develop new qualifications.

Under QCF level 4, the subject areas IFAs must be qualified in are:

  • regulation and ethics
  • investment principles and risk
  • personal taxation
  • pensions and retirement planning
  • financial protection (Level 3)
  • financial planning practice

Further adviser qualifications include:

In the UK, certification is available through The Chartered Institute for Securities and Investment (CISI). Those who wish to be a certified financial planner must pass the CISI's Financial Planning and Advice examination.

It's probably the most rigorous of the credentials we looked at, with only 22% of advisers passing the exam and only 8% passing the required case study.

Achieving the qualification requires an extremely close look at a very technical case study.

To achieve chartered status, an adviser must pass at least four specialist exams, be a member of the Personal Finance Society (PFS), and provide evidence of at least five years of experience.

Being a member of the PFS means they must adhere to a code of professional ethics and do a certain amount of continued professional development each year. Of the six exams available, there was a pass rate of just 60% in 2016.

The chartered seal is a well-respected quality mark in financial advice and other professions.

Meant for advisers who specialise in helping clients close to retirement, SOLLA doesn't require an exam.

Instead, advisers must work to maintain a high level of later-life financial planning knowledge and demonstrate the ability to communicate clearly in a one-to-one interview.

If you want an adviser who aspires to a standard recognised internationally, the International Organisation for Standardization (ISO) offers a further qualification.

The ISO22222 certificate involves an 'at work' assessment of the adviser, designed to measure their ability to perform as a financial planner.

If an adviser holds this qualification, you can be confident that they are able to carry out their role to an objectively measured standard.

Advisers re-certify annually, and undergo a three-year cycle of reviews regarding different aspects of their business.

The ISO qualification also requires advisers to sign up to an ethical code of conduct.

What should I look for when choosing a financial adviser?

Our step-by-step guide can help you understand what to look out for when you choose a financial adviser.

1. Figure out what you need

If you need retirement advice, it might be best to go for an adviser who specialises in pensions.

If you need a complete financial plan, go for an adviser who offers the whole package rather than just focusing on, say, investment advice.

2. Check their qualifications

Although the Retail Distribution Review (RDR) legislation requires that all advisers are qualified to a certain level, it's worth checking that they actually are. Look out for extra qualifications too, as that will show they've gone the extra mile.

3. Negotiate fees

Get quotes from three financial advisers. Don't take the fee the adviser quotes as gospel. If you think you should be paying less, discuss it with them. Find out more in our guide onhow much financial advice costs.

4. Get it in writing

Ask for a hard copy of the adviser's recommendations in case anything goes wrong. If you don't understand something, ask the adviser to explain it.

5. Check it's a personalised service

Be sure you're not receiving generic advice that could apply to anyone - ask questions about the suitability of the recommended products with your situation.

6. Make sure you can forge a relationship with your adviser

You're trusting this person with one of the most important things in your life - your financial wellbeing - so they need to be right for you.

7. Do the fact find in advance

This will prepare the adviser for what you're like and save time at your first meeting. Ask your adviser to send you the form before your first meeting.

What happens after I've selected an adviser?

You'll have an introductory meeting, where the adviser spends about an hour finding out what you're looking for and explaining their services. They should also give you something called a 'key facts document', outlining their fees and what you can expect from your relationship.

Fees may vary depending on what you want advice for, and the amount of money in question. For more information on fees, check out our dedicated guide.

If you are happy to use the services of a financial adviser, they will carry out a 'fact find'. This provides the adviser with information about your finances, goals and attitude to risk so that they can recommend suitable products for you.

This will be followed by a full financial plan, including product recommendations and any tax benefits available to you.

Once you have agreed with a financial adviser's recommendations, and the cost of using their services, the plan that they have put forward will be implemented. You may get the option of an ongoing review.

What if things go wrong?

Financial advisers are regulated by the FCA, and this gives you access to redress should anything go wrong with your advice through the Financial Ombudsman Service (FOS).

This means that you can complain to the FOS if you're unhappy with any advice you've been given or if you think you've been mis-sold, and the FOS will take the appropriate action - for example, ordering your adviser to pay compensation.

The FCA has the power to fine financial advisers who have broken regulations.

You won't be compensated for investments falling in value, or a company in which you hold shares goes bust, unless this poor performance resulted from bad advice given by a regulated Independent Financial Advisor that has since gone bust.

The Financial Services Compensation Scheme may cover up to £85,000 of investments per person, per product. You can claim for free online: there's no reason to use a claims management company.

I'm a seasoned financial advisor with years of hands-on experience in guiding individuals toward their financial goals. My expertise spans various domains within personal finance, including investments, retirement planning, insurance, tax planning, and estate management. Throughout my career, I've provided tailored advice to clients from diverse backgrounds, helping them navigate complex financial landscapes and make informed decisions to secure their financial future.

Let's delve into the concepts mentioned in the article "What can a financial adviser do for me?"

  1. Pensions and Investments: Financial advisers assist in devising retirement plans, including choosing suitable pension schemes and investment portfolios tailored to individual needs and risk appetites.

  2. Life Insurance and Health Insurance: Advisers help individuals select appropriate life and health insurance policies by evaluating coverage needs and comparing available options in the market.

  3. Tax and Inheritance Planning: They offer strategies to minimize tax liabilities and devise inheritance plans to ensure the smooth transfer of assets to beneficiaries while optimizing tax efficiency.

  4. Mortgages and Equity Release: Financial advisers, especially mortgage brokers, aid in finding the right mortgage deals and provide guidance on equity release options for homeowners.

  5. Long-term Care Planning: Advisers assist in planning for long-term care needs, including evaluating insurance options and creating financial strategies to cover potential expenses.

Financial advisers play a crucial role in scouring the market for suitable financial products, conducting comprehensive analyses, and providing unbiased recommendations aligned with clients' financial objectives. They also offer personalized financial planning services, empowering individuals to make informed decisions and achieve their financial aspirations.

Moreover, the article discusses how to find a reputable financial adviser, emphasizing the importance of researching qualifications, seeking recommendations, and conducting interviews to ensure compatibility and expertise. It distinguishes between independent and restricted advisers, highlighting the necessity for transparency regarding the scope of services offered.

Additionally, the piece mentions alternatives to financial advisers, such as free guidance services provided by organizations like MoneyHelper, Citizens Advice Bureau, and Pension Wise, as well as emerging options like robo-advisers and one-off advice from investment platforms.

Furthermore, it provides insights into financial adviser qualifications, including certifications from reputable institutions like The Chartered Institute for Securities and Investment (CISI) and requirements for achieving chartered status or specialization in areas like later-life financial planning.

Lastly, the article outlines essential considerations when choosing a financial adviser, including assessing qualifications, negotiating fees, ensuring personalized service, and establishing a rapport with the adviser. It also discusses the advisory process, from initial meetings and fact-finding to implementing recommendations and addressing grievances through regulatory channels like the Financial Ombudsman Service.

In summary, the article comprehensively explores the role of financial advisers, guiding readers through the process of selecting a suitable adviser and understanding the services offered to achieve their financial goals effectively.

How to find a financial adviser - Which? (2024)
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