Hiring a Financial Advisor: Understanding the Costs
Many people prefer to manage their own finances. Sometimes, however, it becomes necessary to hire a professional financial advisor to assist you with your financial affairs and investments. If you are managing many investments, if a lot of money is involved, or if you simply want to ensure you are on track with your financial goals, such as retirement, you might need to hire a financial advisor.
This guide covers what services are offered and what costs are associated with hiring a financial adviser.
What Services do Financial Advisors Offer?
Financial advisors are professionals who provide services related to financial advice and planning. They assist with money and wealth management and personal financial matters. A financial advisor can help you manage your investments and help ensure your savings are on track for your financial goals.
The following is a list of the kinds of services offered by financial advisors:
- Retirement Advice
- Financial Planning
- Wealth Management
- Equity Release
- Commercial Insurance
- Debt Help
- Annuity Assistance
- Final Salary Pension Transfers
- Life Insurance
- Funeral Plans
When Should you Hire a Financial Advisor? You may be wondering if you should handle your financial matters on your own. There are many reasons that people choose to hire a financial advisor. If you are unsure of how to manage your savings or investments, or if you don’t have the time to manage them, you should hire a financial advisor. Many also hire financial advisors when they are expecting a significant life change, such as having a child, getting married, or retiring, and want to make sure their finances are in order and that their savings are on track.
How Much Does it Cost to Hire a Financial Advisor?
The initial costs of hiring a financial advisor can vary. Many financial advisors will offer a free initial consultation/meeting. In this meeting, the financial advisor will seek to get an overview of your main concerns with your finances. You should be able to get an idea of the benefits they offer and would pay fees for their services going forward.
There are several different types of financial advisor fees. One type is called assets under management fee, or AUM fee. This fee is a method of billing based on the number of assets they will be managing for you. It will be a percentage of the pot size. For example, with pension management, it will typically be a pension pot crystallised into a drawdown pension. Often, there are smaller ongoing charges as well. Some financial advisors charge flat fees for their services. There can be monthly rates, yearly rates, hourly, or per-service rates.
Some financial advisors are also paid a commission for their services, which are usually a percentage of your investments.
In Closing if you need help managing your finances or planning your savings or dealing with major life events you should consider hiring a financial planner. You should choose the best financial planner for your needs and your budget. Financialadvisers.co.uk can help you identify the right Adviser to hire.