FAQs
What is a Financial Advisor?
Financial advisers help people and organisations choose investments, savings, pensions, mortgages, and insurance products.
If you are getting advice about investing your money, you need to know there are two different types of financial advisors; ‘independent’ and ‘restricted’ and this can affect the advice you are given.
Some advisors can offer the full range of financial products and providers available and are called ‘independent advisors. But many advisors have chosen to offer ‘restricted advice’ and will focus on a limited selection of products and/or providers.
All financial advisors must be approved or authorised by the FCA. Both independent and restricted advisors must pass the same qualifications and meet the same requirements to ensure they are providing suitable advice.
Financial planners recommend the courses of action and financial products that will be most beneficial to their clients, who may be individuals or organisations. Financial planners understand their clients’ life situations in depth and advise on topics such as risk management, investment, estate planning, tax, education planning, mortgages, and pension planning; some will specialise in certain areas.
The emphasis of the financial planner’s role is now on building longer-term relationships between a professional and a client rather than on meeting short-term sales targets on the products they recommend.
What is a financial plan & why is it important?
A financial plan is a document that details a person’s current financial circumstances and their short- and long-term monetary goals. It includes strategies to achieve those goals.
A financial plan can help you to establish and plan for fundamental needs, such as managing life's risks (e.g., those involving health or disability), income and spending, and debt reduction.
It can provide financial guidance so that you're prepared to meet your obligations and objectives. It can also help you track your progress throughout the years toward financial well-being.
Financial planning involves a thorough evaluation of one’s money situation (income, spending, debt, and saving) and expectations for the future.