What is the value of an Independent Financial Advisor?
First things first, what does an independent financial advisor do?
Looking to invest? Maybe you want to grow your rental business? You need money to invest and to grow your portfolio, so an independent financial advisor might be worthwhile for you. They are completely up-to-date with what is going on in the financial world and know all about the best products and services available, so they are able to provide specialist advice on how to manage your money.
The idea is to create a plan to achieve your financial goals and come up with strategies to eliminate risk and build wealth over a long period of time.
But would you trust a financial advisor to help you?
A 2021 survey of 2,000 people showed that most people don’t:
- 57% said they did not trust financial advisers
- Among the over 55s, this rose to 65%
- More than 1 in 4 said they had been pressured into purchasing a product without really understanding what it was
- 13% said they had lost money based on their advice
- 76% felt confident in their own ability to make good financial decisions
Do I need an independent financial advisor?
Anyone can get advice from an independent financial advisor, but as you do have to pay for that advice, it’s worth considering if you need it and doing your research ahead of time to make sure you find the right person.
As a landlord, you already have at least one investment, working with a financial advisor could help you:
- Grow your portfolio. If you want to invest in more property in the future, a financial advisor can help you create a strategy to help you towards this goal
- Diversify your investments. If you are keen to invest in things other than property, you should definitely speak to a financial advisor, who will be able to give you better advice than you’re likely to find researching on your own
- Future proof. The pandemic hit us all hard, so if you want to protect your income and investments, a financial advisor can help you
However, if you are looking to do any of these, you don’t necessarily need to speak to an independent financial advisor.
- Speak to a mortgage advisor. Looking to grow your portfolio? Book some time in to speak to a buy-to-let mortgage specialist who will be able to advise you on the best deals and next steps you can take
- Get Rent Guarantee Insurance. To protect your current rental investments, make sure you have RGI on each property, as this will protect you in the event of missed payments. Mashroom’s RGI also includes legal support if you need it
- Monitor your finances closely. Make sure you’re not sticking your head in the sand when it comes to money – have regular check-ins, so you know where you’re spending and how you can save. You can use our free Expense Tracker to visualise things
How do I choose an independent financial advisor?
If you decide that you want to make some more investments or get some advice, make sure you do your research first.
- Ask for recommendations. If any of your friends or family members have used an independent advisor, ask them how they got on and if they would recommend them
- Check their qualifications. IFAs have to be approved or authorised by the FCA, so be sure to check that they are approved, otherwise you could be working with an unregulated advisor!
- Speak to them first. When you call to book an appointment, now is the time to ask a few questions. You can ask about their experience and qualifications and if you summarise here what you’re looking for help with, they will be able to tell you if they’re the right person for the job!
- Book a free call. Many IFAs offer a free consultation, so you may want to try this before committing financially
Property investment is a reliable and versatile form of investment because people always need homes and properties tend to accrue in value over time. So we would also recommend looking to invest in Buy-to-Lets over riskier investments.
However, all investment has an element of risk involved and that is something you should consider before acting on any advice that you’re given.