10 Top Tips From Leading UK Financial Advisors

1.Check your protection

Parents should review their protection policies and consider an income rather than lump sum-based product, according to Colin Last of Tamar IFA

‘As far as protection is concerned, make sure the level and type of protection you have in place is right at any given time,’ he said.

‘If in the past you have been recommended a lump sum policy, which pays out a lump sum on your death, and now you have children, you should review that [policy] and look at doing a family income benefit policy, which is more relevant, because it pays out income for the remainder of the term.’

2. Invest ethically

Helen Tandy, director of the Gaeia Partnership, wants more public awareness of ethical investments, allowing the public to put its principles into financial practice.

Tandy said she would like to see people consider investments that could protect the environment.

‘I don’t think a lot of people realise they can put their ethical views into their investments. If you aim to protect the environment and buy organic products, you can mirror those views with your finances. Do some research on those types of investments.’

3. Stop procrastinating

If Jason Witcombe of Evolve Financial Planning could teach his clients one thing, it would be: ‘Don’t do tomorrow what can be done today, especially when opting into a pension scheme.

‘We all put off tasks that we don’t want to deal with, or don’t know how to deal with, in all aspects of our lives,’ he said. ‘But it’s very easy to put it off for months and wake up a decade later wishing you had done something sooner.

‘I’ve spoken to people who have said they’ve never joined their company pension scheme because they didn’t get around to it when they first joined. But 10 years later they are in the same job and have missed out on years of a company pension.’

4. Buck the bond trend

Investors should pay more attention to equities rather than following the crowd buying bonds, said Jeremy Davis managing director of 35 Finance.

Davis said he had been telling income-seeking clients to decrease their exposure to bonds and increase allocation to equities.

‘Because of fear, people have been buying bonds. Sales of bond funds have been higher than equities for a long time. And yet the next move for interest rates will be up, which is no good for bonds, so the best source of income is equities.

‘The dividend yield on income-producing equities is higher than the yield on bonds. There is potential for capital growth.’

5. Review your financial needs

Keith Churchouse of Chapters Financial would like to see Joe Public review his finances to make sure they are still appropriate, as his circumstances and aims may have changed since he first made an investment or set up a pension.

‘Just like their lives, people’s financial plans do not stand still,’ he said. ‘A pension or investment may not meet the requirements first specified, so always review it in the light of their circumstances if these change.’

6. Not so fantastic plastic

Credit cards are the work of the devil and should be avoided, according to Lee Robertson of  Investment Quorum.

‘Never a borrower be, particularly on plastic,’ he said. ‘They create a false sense of security and the interest rates are frankly scandalous.’

Robertson said people could justify a credit card to get a credit rating, or for emergencies, but should pay it off as soon as they could and not use it on a regular basis.

7. Where’s your pension?

Martin Bamford, Managing Director of Informed Choice wants the general public to understand where their pension is invested.

Bamford said many people chose default investment options for their pension and did not select funds that matched their risk tolerance.

‘It’s important to select funds that match your attitude towards risk and your own individual retirement goals. So, rather than opt for a default option, choose things that suit you,’ he said.

‘We get feedback from clients who go for the default: they’re very disappointed with how it’s performed and feel they don’t have the confidence to put more money into their pension.’

8.Think before you invest

Paul Beasley Managing director of Richmond House Group, wants to teach consumers to take some time to consider their investment choices rather than just do what they are told by an adviser.

He said he also wanted to see people take a greater interest in their investments once these had been made.

‘Don’t rush into any decision, take time to consider it,’ he said.

‘If it’s an investment decision, try to follow it yourself for a short period of time, so you can get a feel for its movement in relation to the market and be a bit more considered before jumping in. It always surprises me how easily some clients just say: “Yes, that’s fine,” and invest.’

9. Avoid debt

Sometimes the simplest lessons are the hardest to learn.

Pete Matthew of Jacksons Wealth Management wants to drum in the importance of people not spending more than they earn.

Matthew said budgeting might be boring, but it was crucial if consumers wanted to avoid falling into debt.

‘It’s a factor for all my clients, either when they’re building wealth and need to spend less than they earn to have saveable income, or when they’re decumulating.’

10. Think long term

People should focus on their long-term goals rather than short-term events when investing, said Steve Buttercase, financial planner with Sense Financial Solutions

He said investors would be better served by concentrating on their ultimate goals and should not be swayed to change course because of unexpected events or brief trends.

‘Nothing will last forever, whether it is good or bad,’ he said. ‘A boom time will end, a recession will end. The hardest thing to do is not respond to the fund or sector of the moment. Make it totally goal-focused and don’t radically change just because of the flavour of the month.’


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