Why having a trustworthy IFA for your confidential affairs is crucial, and how to find one

How much should you divulge to your accountant or solicitor? You know honesty is crucial for legal reasons and to get the best advice.

But what about your financial adviser? How much personal information should you share? And how comfortable are you revealing intimate details about your health, family ties and future dreams?

At Direct Financial Planning, many of our clients have been with us for years, even decades. The reasons are clear: we've consistently helped them achieve or surpass their financial goals, and we've fostered strong relationships grounded in trust and honesty. This trust not only boosts their confidence in our expertise but also makes them feel comfortable to share personal details with us.

How do you find the right IFA to be open and honest with? 

Many people find their Independent Financial Adviser (IFA) through personal referrals. Why not start by asking friends or family members for their recommendations.

Searching online will yield countless options, so how do you narrow them down? Here are a few key things to look for:

Independent:

Choose an independent financial adviser (IFA). They act solely on your behalf and have access to the entire market when recommending solutions. Non-independent advisers are limited to a specific range of products.

Regulated:

Ensure the financial adviser is regulated by the Financial Conduct Authority (FCA). You can verify this by searching the FCA register.

Qualified and Experienced:

Your IFA should meet minimum qualification standards, with many holding additional qualifications in areas like Equity Release and Long-Term Care. They must also have a current Statement of Professional Standing (SPS), renewed annually.

Location:

Decide if meeting in person is important to you. Or if you are happy with virtual meetings. 

Range of Expertise:

Identify your needs. Most IFAs cover basics like retirement planning, savings and investments, financial protection (life insurance, income protection, critical illness cover), mortgage advice and estate planning.  Business owners may need an IFA with expertise in employee benefits and corporation tax.

Initial Meeting:

Before committing, arrange a short meeting with potential IFAs. Assess their competence and professionalism, but more importantly, ensure you feel comfortable sharing information with them.

Honesty with Your IFA Pays Off

Being upfront with your IFA is crucial. Complete honesty, especially for financial protection like life or income insurance, is essential. Insurers typically pay out 90%-95% of claims, with the main reason for denial being non-disclosure of important information at the application stage. This includes lifestyle choices (like smoking) and existing health conditions.
By being transparent with your IFA from the start, you can avoid wasting time and money on unsuitable options, full disclosure ensures your adviser can provide the best recommendations tailored to your needs.

The Truth Doesn’t Have to Hurt

Sharing personal details or aspirations can be uncomfortable, but it’s crucial for effective financial planning. Many feel awkward discussing their financial goals or plans for their estate after passing.

Remember, your IFA, like a lawyer or accountant, isn’t there to judge you. They need all the facts to guide you toward the best outcomes based on your current situation and future goals. Being honest about what you truly want helps your IFA tailor recommendations to your needs, filtering out unsuitable options. What worked for someone else might not be right for you, so we focus on your desired outcomes rather than specific products.
We hope this has eased any nerves about finding an IFA. We're here to help you achieve your financial goals with confidence and expertise.