31 Jan 2012

Out with the old and in with the new?

Out with the old and in with the new?

Time to consider your future... and your financial adviser?

Time to consider your future...and your financial adviser?

As we leave behind a year of turmoil in financial markets there will be very few within the financial services industry who will look back with any fondness when they remember the last twelve months.

However the banking industry may look back with even more regret as they consider fines of over £30m between 5 lenders and redress to clients of over £100m as the FSA took action over what they deemed to be inappropriate advice, miss-selling of investment products and unacceptable handling of client complaints. 

Add to this the huge sum of £5.5 Billion set aside to deal with paying for claims which will have to be met to address the miss-selling of Payment Protection Insurance and you can see why some high street lenders might appear happy to see the back of 2011. 

But will the New Year bring a new regime when it comes to giving customers appropriate advice for their needs? 

Not according to a “Which” survey published in November of last year where it was claimed that only 5 out of 37 advisers gave good advice on investments from ten different banks or building societies they visited with one bank taking over 8% commission on the investment being recommended!

However change is coming in the shape of the FCA project known as the "retail distribution review" which is planned to be fully implemented by the end of 2012. This will see all advisers having to meet certain qualification levels and they will be all be paid by fee rather than commission. 

This has prompted some banks to consider whether the reduced income and increased regulation makes it worth being involved  as some have pulled out of the mainstream financial planning market already with potentially more to follow. 

This is why using a good IFA can really add to your long term financial planning. 

The mixture of well qualified advisers, access to a full market of products or funds and a fair charging structure seems a lot better than what is being offered currently by some banks-welcome 2012 with a review of your own financial planning....and make sure you don’t bank on the wrong adviser.

Allan Gardner, Financial Services Director

 


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