Money Advice Service

Choosing a financial adviser might seem daunting but if you need help with a financial decision it’s worth persevering. A good adviser can save you money and a lot of worry.

The key to finding the right financial adviser is working out what type of advice you need.

Looking for advice on using your pension pot, long term care planning or equity release? Our Retirement adviser directory can help you find the right financial adviser for you.

For example, are you looking for help with investing into your pension or a stocks and shares ISA? Are you coming up to retirement?

Are you looking for a mortgage or perhaps life insurance? Do you need specialist home, car or travel insurance?

There are lots of reasons why people need advice from a financial adviser but there are also lots of different types of adviser, so it pays to know who to go to and when.

How to find a financial adviser

Personal recommendation from friends or family is one way to find a financial adviser but it’s not always easy to work out whether an adviser has done a good job until years after they have given the advice.

Being ‘nice’ doesn’t always mean they’re a good adviser.

Some unions or affinity groups and workplace pension schemes have selected advisers to recommend to their membership.

So if you’re a member of one of these groups, check with them first.

For advice on pension and retirement planning, long term care planning, equity release, inheritance tax planning or wills and probate)

The Money Advice Service Retirement adviser directory

Society of Later Life Advisers (SOLLA)

For mortgages, protection insurance, investments and general financial planning

To find an insurance broker

British Insurance Brokers’ Association (BIBA) Find a broker service

0800 950 1790

Types of adviser

Financial advisers come in different guises and aren’t always called ‘financial advisers’.

Sometimes they are named by their specialism such as ‘mortgage adviser’, ‘investment adviser’, ‘pension adviser’ or ‘financial planner’.

Sometimes they are known as ‘brokers’ - often when dealing with products such as:

  • mortgages
  • home and car insurance, or
  • investments including shares.

Whatever they might be called (or call themselves), what all financial advisers in the UK do have in common is they’re regulated by the Financial Conduct Authority (FCA).

This means there are rules they must follow when dealing with you.

Advisers who deal with: Investments; pensions (including pension transfers); retirement income products and general financial planning

Since January 2013, advisers recommending these types of products must carry higher levels of qualifications.

Prior to this, many were paid by commission collected from charges on the products they sold.

You can find out more about fees and commission in our guide to financial adviser fees.

In reality, advisers who provide advice on the products listed above, might also provide advice on protection insurance (such as life insurance) and sometimes mortgages.

Many offer holistic financial planning, where they will advise you on all aspects of your financial needs.

Advisers in this category are classified as either independent or restricted.

Restricted advisers might either be restricted in the type of products they offer, or the number of providers they choose from.

Independent financial advisers can recommend all types of retail investment products and pension products from firms across the market without restriction.

You might want to consider choosing an adviser who can deal with a wide range of product providers for the product they are recommending – and not just one or two. That way you know you will be getting the widest choice. Although, the quality and suitability of the advice should not be impacted by whether you decide on an Independent Financial Advisor or one who is restricted to one or more providers.

Make sure you understand the type of service they offer before you decide whether to get advice from them.

Advisers who deal with: Mortgages and equity release

Mortgage advisers must have specific mortgage qualifications.

Advisers recommending equity release products must also have a specialist qualification in equity release.

These advisers are still permitted to be paid by commission on any mortgage or equity release product they sell.

Some mortgage advisers also charge a fee for their services.

Many mortgage advisers can also advise on protection insurance such as life insurance.

Mortgages advisers might offer a whole of market service, although this won’t necessarily mean they can recommend any mortgage from every lender as some lenders only offer mortgages direct to the public.

Some mortgage advisers offer ‘restricted’ advice and might be tied to just one lender or might only be able to choose from a small number.

An ‘independent’ mortgage adviser will be able to offer a broader range of options from across the whole of market.

Advisers who deal with: General insurance products (such as home, car and travel insurance)

These advisers are often also known as insurance brokers.

Like mortgage advisers they are paid by commission on any insurance product they sell, but don’t normally charge an additional fee.

Insurance brokers will also help you deal with any claims you might make and will shop around for you every year to make sure you’re getting the best deal.

If your circumstances are out of the ordinary- for example if you live in an area susceptible to flooding or you have health issues and need travel insurance - an insurance broker can be especially useful.

They know the insurers who deal with your type of insurance need and will be able to find you the best deal.

However, some insurance brokers will have a wider range of providers dealing with than others so always check the level of service they offer and how many providers they work with.

As with other types of financial advice, brokers who deal with a wide range of insurance providers will give you the widest choice.

This article is provided by the Money Advice Service.