FINANCIAL PLANNING

Key Steps to Finding Good Expat Financial Advice

If you have a leak, you call a plumber; if your car won’t start, you call an engineer. So why would you not contact an expert when it comes to something as important as your finances, tax planning and pensions?

Finding a specialist financial adviser can be difficult, especially if you are an expatriate. You need someone not only competent in UK finance and tax law but who also understands the intricacies of double taxation agreements, wills and Inheritance Tax internationally.

Since the Retail Distribution Review in 2013, it is easier to find a good financial adviser who is qualified if you are living in the UK. The increased regulation eliminated commission and has seen financial advisers embrace more stringent qualifications. The result weeded out around 35% of advisers, as the initial number dropped from 40,000 to 26,000. However, you may still need help narrowing down the choice to find the firm that is most experienced in expat financial services.

WHAT TO LOOK FOR IN A FINANCIAL ADVISER

Questions to ask when looking for a financial adviser include ascertaining whether the person is independent or restricted in the services that they offer. Those who are truly independent can often offer solutions from the full range of financial products available. Those who are restricted are limited to offering what products only their provider has available. They may offer a cheaper fee but are usually unable to offer advice that is outside of their company’s approved product list.

WHAT INDICATES A GOOD FINANCIAL ADVISER?

In most countries, financial advisers must comply with certain standards of conduct and are regulated by a financial body or institution. In the UK, financial advisers are governed by the Financial Conduct Authority (FCA), previously known as the Financial Services Authority (FSA). They investigate complaints and ensure that advisers work for the good of their clients, not for their own self-interest or financial profit.

One of the most useful resources is the FT Adviser Top 100 list. It changes each year, keeping updated by comparing gross sales of investments and pensions (in millions) year on year, the number of advisers and professional qualifications, the age of the business and their ability to retain clients. The Fry Group has been ranked 4th on the 2019 list.

HOW MUCH DO FINANCIAL ADVISERS CHARGE?

Prices can range broadly so it’s important to do your research and choose the financial expert that you feel will charge a fair and reasonable price for the service they can offer and that their offering and specialties suit your particular circumstances.

Some financial advisers charge by the hour. Others have fixed rates for certain services, such as writing a Will or setting up a trust. Another common way to set the fee is by charging a percentage amount based on the size of your investment portfolio that the firm manage for you. Some international advisers still charge a commission for the products that they sell, as although these were outlawed in the UK some international regulators and firms are yet to remove these. Of all the charging styles commission is often the most difficult to understand and therefore it isn’t an approach that we (or the UK regulator) would recommend that you use. Most importantly, make sure that the person or company you choose has the international experience you need to give you the best advice. In the end, what they save in tax mitigation and long-term estate planning could more than offset their charges.

DO YOU NEED A CHARTERED FINANCIAL PLANNER?

A Chartered Financial Planner has to be accredited by the Chartered Insurance Institute (CII) and the award is hard-earned. There are also Chartered Financial Planning firms that must meet strict requirements, less than 10% of all financial planning companies in the UK have received this title which is considered the gold standard in the industry. In order to achieve this prestigious marque, companies are required to demonstrate their ethos and commitment to providing superior financial advice to their clients. The company must demonstrate professional development and a strict adherence to the standard Code of Ethics. As part of being a Chartered Financial Planning firm, the company must show systems and training in place to keep abreast of every development in the ever-changing world of financial and tax law.

Choosing a company that is an accredited Chartered Financial Planning firm means you not only have the crème-de-la-crème of advisers in the industry, you can also be assured of their ongoing commitment to provide the very best service, advice and support for their clients, whether UK-based or living and working aboard.   

DOES COMPANY SIZE MATTER?

Being big does not always equate to being the best. If you are an expat looking for a financial adviser, the most important thing is knowledge, experience and expertise in all aspects of expat finance. The advantage of choosing a company with a team of experts rather than a solo practitioner means that their experience, particularly in expat financial advice, is far broader. It also helps to find a financial adviser who can run the full gamut of services for expats, from estate planning and Wills to tax mitigation, international pensions and investment.

ASK FOR REFERENCES AND TESTIMONIALS

As in all business transactions, the client is responsible for doing their own due diligence before signing a contract or trusting their financial interest, pension, investments etc into the safekeeping of another. Ask for references from existing clients, and contact them for a chat to ensure the endorsement is genuine.

Take a list of questions with you to any consultations and assess whether they can offer you the services you need. Listen to what they say in general terms, ask their opinion on certain issues and compare their advice. If they claim to be regulated, check on the register of that regulatory body.

Choosing a financial adviser is not something to be rushed into and once you have found the best person to advise on your financial circumstances, make a long-term commitment as constant changes can be expensive.

Contact us to speak to one of our Financial Planners about your personal circumstances and to see how we can help you.

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