Beginners' guide to choosing a Financial Adviser

Types of Financial Advisers

Financial advisers fall into three camps. You need to choose the one that suits you best:

Independent Financial Advisers (IFAs): An IFA has to research the whole market before recommending a product. They are paid either by the financial firm whose product they’ve recommended – this is called commission – or directly by you, the customer, paying them a fee. You must be given the option to pay either way.

 

Multi –Tied Agents: A multi-tied agent will have agreements to sell a number of companies’ products. They have to recommend a product from this range and aren’t obliged to scour the whole market on your behalf. The majority will be paid a commission for every product they sell you, although some may offer you the option of paying a fee. Unlike IFAs, they’re not legally obliged to do this.

Tied Agents: A tied agent sells the products of one financial company – and will recommend a product from this range only. The majority will be paid a commission for every product they sell you, although some may offer you the option of paying a fee. Again unlike IFAs, they’re not legally obliged to do this.