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Do I need an Independent Financial Adviser?

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Life’s biggest decisions are usually also financial ones. But you don't have to make them alone. Independent financial advisers can give you advice at all the key life stages. Find out when they can be of most help and how to choose an IFA you can trust.

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You can benefit from financial advice at any time of life, but there are certain times when it can be invaluable or even essential. Let’s take a look at the key advice moments – the very best times for seeing an independent financial adviser (IFA).

Buying a home

Your home will almost certainly be your biggest ever purchase, and the greatest financial burden on you for most of your working life. Securing the right mortgage is vital, but it’s really just the first step. You’ll also have to service that mortgage – pay it off month by month – and many homeowners find they have little room to manoeuvre. A financial adviser can create an overall financial plan for you, to ensure that you really can afford that property, and advise you on how you would manage if your circumstances were to change.

Saving for your pension

You should really be saving into a pension from the day you start your career, so you’ll probably have one on the go by the time you buy your first home. But you need to take care that buying a home, or saving for one, doesn’t detract from your pension savings. It’s tempting to prioritise short-term goals over long-term ones, but remember that the most effective pension saving takes place when you are young.

If you have a workplace pension, the scheme administrator will usually invest your contributions in a ‘default fund’ unless you specify otherwise. In some cases this fund won’t be ideal for your needs if, for example, you are at the start of your career, as you can afford to take more risks when retirement is a long way off. A financial adviser can look at your pension scheme and ensure it is invested in the most suitable funds – this can translate into a difference of many thousands of pounds in the long term.

If you have a private pension, such as a SIPP, then seeking advice is even more important to ensure that your investment choices are appropriate to your needs.

Find a local independent financial adviser through our partners at unbiased. Click the button below and complete a short form to be connected with local advisers 

independent financial advisor service

Having a family

According to the Centre for Economic and Business Research, the average cost of raising one child in the UK to the age of 18 is around £227,000 – around the cost of the average UK house price. In other words, having a child is like taking out an extra mortgage, so requires similarly rigorous financial planning. An IFA can help you re-think not just your weekly and monthly spending, but also long-term plans such as investing for school and higher education. The good thing about childhood is it comes with some very predictable milestones, which is a great help when building an investment strategy.

Financial advice for investing in property

You might be thinking of investing in a second property as a buy-to-let, holiday home or holiday rental.  Whichever one it is, seeking independent financial advice might be prudent, as there are a number of complex things to consider – from the stamp duty charge on second homes to capital gains tax when you sell.

Just like with finding your mortgage, the range of financial products can be mind-boggling. There are for example, Buy-to-Let mortgages and Let-to-Buy mortgages which sound the same but couldn’t be more different!

Accessing your pension

If you seek financial advice only once in your life, it should be when you access your pension savings. You can do this at any age from 55 onwards, so you may still be working and perhaps even still paying off a mortgage. It can be tempting to use some of your savings for home improvements, or perhaps to help your children onto the property ladder. However, you should remember that your pension is intended to support you throughout your retirement.

Options for accessing your pension include lump sums (either tax-free or taxable), a flexible (but finite) income, or a guaranteed (but limited) income for life. Weighing up the pros and cons of these and how they relate to your needs can be very complex. Even more stressful can be the process of turning your decision into action and choosing the correct products. A financial adviser can relieve you of the whole burden, helping you to assess your options and choose the best products, while avoiding costly mistakes.

Financing retirement & long term care

There are many other choices to make in retirement, besides how to access your pension. Will you continue to live in the same home? Can you unlock any of its value to provide extra income? Will you eventually need long-term care? Should you downsize? An IFA can help you weigh up all these options – for example, equity release can provide you with income and/or a lump sum in exchange for some of the value of your home. An adviser will be able to recommend the best solution for your needs. Another common question is how to avoid selling your family home to pay for later life care. Again, speaking to an IFA to plan ahead can help you understand your options.

Transferring ownership of a property

There are a number of reasons why you might want to do a transfer of ownership of property into someone else’s name.

You might marry, and want to transfer half your house to your spouse. You might divorce (and need to transfer the other half too). You might be unmarried but cohabiting. You might live in a house-share of fellow owners (tenants in common) and need to replace someone. Maybe you want to gift a property to your children to reduce inheritance tax. These are just a few of the scenarios, in addition to simply leaving a property in your will.

Whether you’re on the giving or receiving end of ownership transfer, it’s important to know how the process works and all the legal and tax implications – so you don’t end up with any nasty surprises.

How do I choose an Independent Financial Advisor?

Finding the right IFA that you can trust can help you at all these critical life stages. Here’s how to go about finding them:

    1. Check your adviser isn’t tied to any product providers. In your first conversation, ask them to confirm that they are independent or at least whole-of-market, so they can advise you on all relevant products.
    2. Choose an adviser with the right specialisms. For example, if you’re looking to fund long-term care, you may want a different adviser from one who specialises in wealth management. Make sure you know which areas they cover before agreeing to use their service.
    3. Check that your adviser is FCA registered by finding their listing on the Financial Services Register (or use the tool above – advisers found via Unbiased have already been checked).
    4. Ask about your adviser’s qualifications and ask to see their certificates. Make sure these qualifications are relevant to the areas where you need advice.
    5. Make sure your adviser is used to clients in your wealth bracket. If you have average income, you might get overlooked by an adviser who usually works with millionaires.
    6. If you’re in a couple, see your adviser together at the first meeting, whether this is in person or online. This makes it much easier to discuss your financial priorities.
    7. At you first meeting (which is usually free) ask about the adviser’s fees. Make sure you understand what you would be asked to pay, why and when, and that you understand what you would receive in return. Take financial information with you, like mortgage, savings, and insurance paperwork. Have a clear idea of what you want your IFA to do, and what your goals are.
    8. Gather all your financial records together for your first meeting – from bank statements to pension and mortgage documents. Even if you don’t think it’s relevant, your adviser needs as much info as possible.
    9. Do you get along well with the adviser? This isn’t a trivial point – a good rapport will help you understand each other properly and reduce the risk of miscommunication.
    10. If you think you may need ongoing advice over a period of time, ask your adviser about continuity of advice. Will they continue to act for you in person, or will you be passed on to others at the firm?

Find a local independent financial adviser through our partners at unbiased. Click the button below and complete a short form to be connected with local advisers

independent financial advisor service

Leave a comment (19)* Required

  1. Mahabir SinghalMahabir Singhal

    As an expat need a professional to filemy Captal Gains tax Return

  2. Michael HruschkaMichael Hruschka

    To whom it may concern,
    Just sold two properties with my ex partner for over a million pounds.(Business & residential)
    Joe much tax do I need to pay?
    Looking forward hearing back from you.

  3. Hilary ewardHilary eward

    Looking to release equity in my property and buy one or two holiday let properties I am in Shropshire / north Wales

  4. peter lloydpeter lloyd

    I filled out the information required saying I’d like to speak to a financial adviser and specifically said I only wanted to be contacted by email. I nevertheless got a phone call 30 minutes later! This has totally put me off Home Owners Alliance and anything to do with it.

  5. Ellis GillEllis Gill

    My wife and I have loaned our daughter and her husband a significant sum of money Within the last 18months to help them with building work on their house. (They already have a mortgage). Their marriage is now having problems. Can we now protect that money with a loan agreement. If so what do we have to do?

  6. julie hobleyjulie hobley

    CGT advice

  7. FF

    I left my career of 25 years to care for a parent. I moved in with them and rented my home out. I also got redundancy and purchased a buy to let property as a pension. My parent recently went into a home then passed away. I have sold their home which I was also on the deeds of under a trust. I have a part share in a property in Europe. I now want to by my own home to live in as I have been renting recently and don’t want to return to my original property I rented out. I need some advice about CTG on selling these properties and stamp duty for on buying a new one.

  8. FF

    I should like some advice on property tax.
    I left my career of 25 years to care for a parent. I moved in with them and rented my home out. I also got redundancy and purchased a buy to let property as a pension. My parent recently went into a home then passed away. I have sold their home which I was also on the deeds of under a trust. I have a part share in a property in Europe. I now want to by my own home to live in as I have been renting recently and don’t want to return to my original property I rented out. I need some advice about CTG on selling these properties and stamp duty for on buying a new one.

  9. MuralidharMuralidhar

    I have a main property to sell and wanted to understand if I have to pay CGT on it. What are your charges to asses the calculations?

    Also I wanted to understand if I’m leaving the country and I can withdraw my pension pot before reaching 55 yrs

  10. WilliamWilliam

    I would like some clarity on the Capital Gain Tax for military personnel. I joined the RAF in 2005 and my predicted Exit date is 2029. We purchased a 2-bed property in 2011 for £145,000 through the Armed Forces Help to Buy Scheme with the intention of it being our main residence. Unfortunately, due to postings away from the property location we never had the opportunity to live in the premises. The property has been let out until Mar 2020 due to not living in close proximity to the house. We have recently completed a full redemption on the property for £195,00 with the intention to sell for £192,000 because it’s too small for my wife and 3 children. Can you please confirm if we are liable to pay the 18% CGT even though it was never our intention to let the property but required as we could not afford to pay the rent on the military quarters and a house we could not live in?
    Any information or help on above matter will be greatly appreciated.

  11. Mr D DrakeMr D Drake

    My wife and I brought a maisonette 1n 1998 for £54,000 to house my elderly relatives. They have lived there rent free but paid all their bills. In 2016 they had to be moved to an assisted living sheltered housing due to poor health. I’m thinking of selling and know that I will have to pay CGT, but I read somewhere that I may be entitled to a reduced CGT tax. Is this information correct.

    • Mr Drake – thanks for your message. It sounds like you need to speak to a financial advisor to be sure about whether CGT is payable or not – see link in guide above or click here. Best of luck!

  12. JonJon

    Please can you help me understand the rate exempt from inheritance tax. I have been asked to act as executor and want to get things right for those involved. There are 2 sons of the deceased. The father died 2 years ago and left everything to his wife. The wife died recently and left all to the sons. I think the 325,000 unused element is passed to wife and so had thought £650,000 would be exempt. I was told by friend I need to also consider the main residence nil rate band. I read your article and wanted to check whether that means the total is increased to £950,000. If it does, do I need to submit the iht205 and 217 only or do I have to apply for the nil rate band separately. I think if house valued n estate it may be 700-800k. Any help much appreciated or advice on where to look next very helpful

  13. Farhana KhalilFarhana Khalil

    I need advice on capital gains tax and pensions please

    • HomeOwners AllianceHomeOwners Alliance

      Hello Farhana, you can find an independent financial adviser at this link.

  14. DebbieDebbie

    My brother and i have inherited a house from our parents. I will be ‘buying out’ my brother and wonder if I have to pay any kind of tax in doing so. Your help would be greatly appreciated. The property has been valued at £550,000.00. Manu thanks for your help in advance.

    • HomeOwners AllianceHomeOwners Alliance

      Dear Debbie – it sounds like you may have to pay stamp duty land tax on your purchase of your brother’s share of the property. Your conveyancing lawyer will be able to advise you on the amount payable. You can get conveyancing quotes via our site here. Very best of luck!

  15. jane pilejane pile

    good afternoon
    i am in the process of looking at my prospects of owning a holiday let.
    i have been in the industry for years, and have run several holiday caravans – but i have never looked at funding for a ‘house’ that can be rented for holidays.
    i would very much appreciate speaking to a specialist in this field to give me a few pointers and to put me in touch with the right people and to ask the relevant questions etc. i know how to make the money in the returns but i dont know how to get there…
    i look forward to hearing from you soon
    kind regards

    • Sara HindSara Hind

      Hello Jane, if you click on the banner you’ll land on this page and you can fill in your requirements and someone will be in touch.

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