On a given day, a financial adviser will do all sorts of things. They will make investments, model cashflow, manage pensions, track the markets, advise on changing regulations and report on progress.
All those different things combine to a simple end: helping you better manage your money, by…
• taking care that you’re making the most of available tax wrappers (so your money’s working as efficiently as possible)
• suggesting suitable investments that achieve the sort of returns you’re looking for, but at the level of risk you’re comfortable with
• ensuring your portfolio remains properly balanced and within the confines of your risk appetite
• providing counsel on how you can maximise the value of your pension holdings, and suggesting alternative vehicles if you’ve already exceeded your annual or lifetime allowances
• rationalising existing assets from property to equities.
But an adviser’s role isn’t limited to scouring spreadsheets and making investments. A good adviser is as focused on your everyday aspirations and anxieties as they are on the fluctuations of the stock market. They look as much towards your life goals as they do financial targets.
Because no two people are the same, every financial plan will be different. A financial adviser’s job is to work out your life ambitions, then create and implement a plan to get you there.
Simply put, and done well, a financial adviser will help to put you on track to achieve the life you want – and steer you clear of the life you don’t.
Think of them as a co-pilot or navigator for your finances: you’re the one driving the car, but they’re there to keep you on track, taking away the stress and making sure you arrive in the right place, on time.
Many people manage their own finances, and plenty do so successfully. You might be someone who handles your own portfolio, uses ISAs to maximise your tax allowances, and understands the benefit of having a diversified investment portfolio that’s geared towards long-term returns.
You might have made certain your pensions aren’t going to exceed the lifetime allowance and incur a hefty tax bill; made a plan for mitigating inheritance tax for your children; ensured you have relevant insurance protections in place; allocated an appropriate cash balance to cover everyday needs in the case of income or investment loss; and rationalised any company share options you’ve acquired over the course of your career.
And you might be someone who scrutinizes the market, assiduously follows changes in regulation and tax allowances, and adjusts your forecasts and investment strategy on a continuous basis accordingly.
Or, as is often the case, you might do few or none of these things.
We say all this not to be flippant, but to point out the sheer volume of work that’s involved in first developing and then maintaining a profitable financial portfolio. Of course it’s possible to do everything that’s needed as a casual investor on your own behalf, but be honest with yourself. Do you have the necessary knowledge? And, just as important, do you have the time to do it properly? Finally, do you actually want to?
Call us for a free review 01206 331414 or 020380762590