In the current cost of living crisis, getting advice from a professional has never been more important. But for those of you who think that all financial advisers are created equal read on to find out why that isn’t necessarily the case.
All financial advisers are governed by the same regulations but as with all industries the way the advice is provided and the quality of the service can differ massively.
One of the major differences you’ll come across is, if an adviser is ‘independent’ or ‘restricted’.
Independent Financial Adviser (IFA)
As the term suggest, ‘independent’ means an adviser isn’t tied to any one financial institution and can advise on ALL financial solutions or lenders. This is important for you, as it means they aren’t ‘restricted’ in terms of the products they can recommend. They are free to research and recommend products based on how they match your specific needs rather than trying to shoehorn you into a product from a limited range.
Restricted / Authorised Financial Adviser (FA)
These advisers can only advise on the products they are authorised to, which normally means from just one or a handful of service providers or lenders rather than the whole of the market. A Restricted Adviser will have to fit your requirement into the available (restricted) range of products and solutions they have available.
How can you tell an FA from an IFA?
If it’s not clear from the outset you’re dealing with either an IFA or a FA, ask. Well-known, high-street brand advisers are ‘restricted’ and will only be able to advise on their products whereas an IFA will normally make a big deal about the fact we’re independent and can offer advise on the whole market!
Independent vs restricted financial advisers
One of the main advantages of working with an IFA is, as we’ve already said, is the access they have to the whole market place.
But it’s not just that, we also have your best interests at heart. As an Independent Financial Advisor, we are duty bound to give you the best advice for your needs. We can have our advice permissions removed and be shut down should that ever not be the case!
Of course, some people prefer to work with the well know high street names (particularly if you already bank with them) for comfort and perceived ease, but it’s unlikely you’ll receive such a personalised or speedy service as you would with an IFA.
How are IFAs paid?
We can’t speak for all IFA’s as some do charge clients fees but we don’t!
We know that when we say Fee Free some people are dubious, however we really do mean just that. If you are a serving member of the Armed Forces, a Veteran or a close relative you will not pay AFFS any fees for advice!
Unlike so many within the industry we support the Armed Forces Community by waiving our right to charge an upfront fee. We get paid by the Mortgage Lender or Insurance Provider you decide to go with and if you happen not to go with any of them, then quite simply we don’t get paid.
We won’t push you toward the one that pays us the most commission as they tend to pay similarly across the board so it honestly doesn’t matter to us which one you end up with, provided it is one that best suits your needs.
On the flip side, restricted FAs are usually paid through a variety of methods but most usually fees paid by client plus an incentive company providing the financial products that they sell. Payment by commission is rare these days but a bonus for hitting KPIs (key performance indicators) can have the same result.
The AFFS difference
Not only we are completely independent we are also ex-members of the Armed Forces, so we like to think we understand your specific needs better than most other IFAs and Mortgage brokers. In an ever-changing market place, we know exactly which lenders accept the Forces Help to Buy Scheme, previous BFPO address history or the need for Immediate Consent to Let which is essential for people in the military.
We’ve also spent years creating relationships with mortgage providers who support our Armed Forces. They understand your unique circumstances and want to offer something in return. With their help, we have put together a range of exclusive mortgages not available to civvies.
On top of that, we know that given your postings and work commitments we can operate on a 9 to 5 basis, so we predominately operate by email at times to suit you. And, we’ve made our processes as simple as possible. You fill in a couple of forms and send us copies of your documents and that’s it. You can pretty much leave us to it! We’ll work on your behalf as quickly and efficiently as possible while you carry on with your everyday life.
If you’d like to explore how we can help, please get in touch.