Hannah Beecham explains why expats should always check the credentials of anyone claiming to be a financial adviser
When you think about the qualities you admire most in those you respect, concepts such as integrity, sincerity and trustworthiness will undoubtedly be at or near the top of your list. So what qualities would you expect to find in a good financial adviser? Would you lower the bar? And, in that first crucial meeting, how would you put those qualities to the test? Too many smart, capable expats on the look-out for financial advice are falling for smooth-talking con merchants. Right now, 49,000 investors are learning from the UK’s financial regulators that the adviser they entrusted their savings to is, in fact, no such thing and what they’ve done is hand over all they’ve got to a common thief. It’s time we put a stop to the rot.
Here are some practical steps you can take to ascertain whether a prospective financial adviser is the sort of individual who deserves your trust. At the very first meeting, even before you talk about your financial aims and objectives, put yourself in the driving seat and ensure your questions are dealt with to your satisfaction. Go armed with a checklist covering these three vital areas: the adviser’s business, regulator, and jurisdiction.
Remember, this could be the start of a significant relationship. Don’t be surprised, therefore, or disappointed, if you have to endure several meetings before you find an adviser that passes the partnership tests.
And if you find it hard to distinguish between an expert explaining their knowledge and a con man giving you the blag, here are some clues about when to cut a meeting short and walk away. Be highly suspicious of anyone who cold calls. Same goes for an offer of a once-in-a-lifetime opportunity or any offer that must be seized at once. Be aware of the average rate of return on investments – indices are helpful here, such as the FTSE 100 Index – and immediately shut down any talk that promises a significantly higher rater of return than what’s being achieved by the mainstream. Be on your guard, too, if the advice is to liquidate all your existing investments or if you are not asked in considerable detail about your present financial circumstances and current commitments.
To check out any financial adviser, go first to the website of the UK’s Financial Services Authority. It has a Register of approved and authorised IFAs and, just as importantly, a list of those that the FSA deems dodgy. What’s more the FSA site includes notices and warnings issued by other foreign regulatory authorities.
Expats may also turn to FEIFA – The Federation of European Independent Financial Advisers. Members are put through a rigorous vetting and due diligence procedure, which will save you a great deal of legwork and, I hope, ensure your financial peace of mind.
Hannah Beecham is Managing Editor of the first comprehensive online financial channel for British expats, www.expatmoneychannel.com
