What does a Financial Adviser do?

Financial Advisers help people with their long-term financial planning, which can include investments and pensions. Some will also help people with Mortgages and Insurance They may also help in specialist areas like Inheritance Tax planning or Estate Planning.

People will often go to an Adviser either with a specific need, such as consolidating a pension, or a broader goal, such as wanting to review all finances and making sure he/she is set up for retirement.

Financial Advisers can help you at all stages of life – young families, mid-life, pre-retirement, post-retirement, later life, marriage, death and divorce.

A Financial Adviser will start by understanding your situation – your finances, your future plans (how much it will cost), and how cautious or adventurous you want to be with your money. They will then present you with a plan outlining your financial options. This might cover how much you save for the short-term vs. invest for the long-term.

Once you have agreed a plan with the Financial Adviser, they will then hunt down the very best accounts, funds or products for you. They will then complete the necessary administrative work to begin your Financial plan.

Finally, a Financial Adviser will regularly update you on how your finances are performing and on occasion review your financial situation with you.

Typical Pension Services that you might need

Pension Review

Advisers can assess an individual's current pension arrangements, including the projected retirement income, charges, and investment strategies, to determine if they're on track to meet their retirement goals.

Pension Consolidation

For individuals with multiple pension pots, advisers can assist in determining whether it would be beneficial to consolidate these into a single scheme. This can make management easier and potentially reduce fees.

Retirement Planning

Advisers can assist with creating a comprehensive retirement strategy, which includes understanding when someone can afford to retire, what kind of lifestyle they can expect, and what sort of provisions they need to make for later life.

Annuity and Drawdown Advice

When it's time to access pension savings, an adviser can help clients decide between purchasing an annuity (a guaranteed income for life) or opting for a drawdown (where the pension remains invested, and the individual draws an income from it). They can guide on the pros and cons of each, potential tax implications, and the best providers or strategies for each option.

Pension Investment Strategy

Advisers can assist in selecting the right investment strategy for pension funds, ensuring they align with the client's risk tolerance, time horizon, and financial goals. They can also regularly review and adjust these investments as markets change and as clients approach retirement.

SIPP (Self-Invested Personal Pension)

Definition: A type of personal pension that offers a wider choice of investments compared to a traditional personal pension.

Features:

-  Flexibility in investment choice, allowing individuals to invest in a wide range of assets such as stocks, bonds, commercial property, and more.

-  Ideal for those who are experienced investors or those who want to take an active role in managing their pension investments.

-  SIPPs may come with higher charges due to the broader range of investment options and the administrative complexities they might involve.

-  Typically managed by the individual or their appointed investment manager.

SSAS (Small Self-Administered Scheme)

Definition: A type of occupational pension scheme typically set up by directors of a company for their benefit, or for the benefit of specific employees.

Features:

-  Offers a wide range of investment opportunities, similar to a SIPP.

-  Can be more complex in terms of administration and governance.

-  Allows for loans to be made back to the sponsoring employer, subject to certain conditions.

-  Given its nature as an occupational pension, it can be a useful tool for business planning and financial management.

-  Typically involves a closer relationship between the pension scheme and the sponsoring employer than with other types of pension schemes.

Both SIPPs and SSASs can offer greater investment flexibility, but they also come with increased responsibilities in terms of investment decision-making and administration. It's crucial for individuals to be aware of these responsibilities and, where necessary, to seek appropriate advice when considering either of these pension options.

Engaging with a financial adviser for these services can ensure individuals optimize their pension savings and make the most of their funds during retirement.

Disclaimer

The details on this page are for information purposes only and should not be taken as personal recommendations. Before taking any action regarding your pension or financial situation, you should obtain advice from a suitably qualified independent financial adviser. You will not be charged any fee if your pension remains unchanged. Should the resulting advice lead to a transfer of your pension, a fee may be payable.

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