I never used to be much of a fan of Independent Financial Advisors (IFA). Back in the bad old days of the 80s, 90s and 00’s, all sorts of con-artists touted themselves about as ‘financial advisors’ when they were actually just salespeople for dodgy insurance and investment companies.

Even the banks got in the act, selling us pensions, life insurance and other products that were overpriced and underperforming.

In 2012, though, the Retail Distribution Review came out, effectively outlawing commission-based ‘advice’. Now it all has to be paid for so that you get genuinely independent advice.

There’s still a way of getting it for free – at least temporarily (see below) – but basically it’s a proper service that we need to pay for in order to get proper advice.

So, should you have a financial advisor?

Pros

• You get someone who has seriously studied investing and money management taking a good, impartial look at your money and your whole situation. From their knowledge-base they can suggest products and give you a plan of action that you might never even have thought of yourself
• They can remind you to update your plan and possibly make extra investments at different points in your life which you might forget about or put off if left to your own devices. This can mean you have money to do what you want to do with your life later on.
• They can take away from you the burden of trying to work out complicated financial matters like pensions, life insurance, inheritance planning and divorce.
• You can get a free initial consultation with IFAs. This will show you whether they know their stuff or not. For some people that first consultation might be all they need too, so they get good advice for nothing.

Cons

• IFAs cost. The point of an independent financial advisor is that they are not swayed by commissions from different providers. You pay them a fee to do the work for you. That will run into the hundreds for a proper plan and then you might have an annual fee to keep it updated.
• They might not have the same idea of risk as you. For example, they might think that you are more cautious than you are and only suggest safe, low-performing products which you wouldn’t go for if left to your own devices. Make sure you are clear about how much risk you want to take with your investments and what your plans are for your future before you talk to an advisor.

What I do

For years I did my own investing and planning. My view early on was – and still is – that if you have a pretty straightforward life with relatively little money coming in and out, then you’re probably best off just keeping out of debt, creating a savings safety net and putting regular amounts of money into a company pension and index-tracking funds (ideally wrapped in an ISA to cut down on the tax) each year.

But once you get a bit more cash, and certainly once your life gets a bit more complicated with family, step-families, relatives to care for or retirement looming, it’s definitely worth spending money on an independent financial advisor.

I took on a financial advisor myself a couple of years ago, mainly because I had a few pensions that I had set up over the years and I wanted someone who knew what they were doing to look at them and tell me if I should keep them separate or transfer them all into one big pension. It cost me over £1,000 to get this done, together with a good financial plan for my life, and I feel it was worth it. Once a year my advisor and I go over that plan to see what has changed and what I need to do, if anything, to get myself back on track for a glamorous retirement full of hot and cold running toy boys and cruises round the Med!

My brother also now uses this advisor and he tells me she helped him to sleep at night because he now knows that his pension is on track to keep him and his wife at the standard they would like when he retires.

If you want a FREE consultation with an IFA

Go to VouchedFor to find independent financial advisors near you who have good reviews from users. It takes the guesswork out of it if you know that other customers rate them.

Jasmine x

Jasmine is the queen of cash, the money-making guru, the woman who puts the funny into money (yes, really!) and she knows her stuff. She’s presented Homes Under the Hammer, Doctor Dosh and Spend, Spend, Spend on the telly. You’ve probably also seen her on BBC Breakfast News, GMB, Sky News and more TV progs talking a out all things financial, or you might have read one of her 38 books! She’s a stand-up comedian as well as being a financial whizz and she has agreed to be our resident Money Expert. Read her stuff and get instantly richer…and happier!