Ifa

jscol

My wife and I are looking to get an IFA mainly to advise us about our pension / tax situation.

Are there any particular qualifications / qualities that one should look for? Are there any particular screening questions one should ask to determine how suitable a prospective IFA is ?

We have meet one IFA and had a free introductory meeting. He certainly seemed pleasant and helpful. However now that we have to make a commitment I'm realising that I know very little about IFAs and their qualifications.

bostonerimus

Why don't you ask a few questions on here, you'll get some responses that might help you to make some educated choices.

jscol

We both in our 40's. Mortgage paid off and have some savings and investments.
I pay 60% tax equivalent. I reckon I on course to go over the LTA for my work pension but can't be absolutely sure.
My wife pays 20% tax.
We interested in using additional pension to get the tax relief.
Don't know whether to do it in her name and get 20% tax relief. Or my name and get more tax relief but accept punitive tax for exceeding LTA in due course.

I felt sufficiently complicated that we needed IFA. ?

xylophone

https://www.pensionsadvisoryservice.org.uk/about-pensions/pensions-basics/top-tips-for-your-pension/choosing-an-ifa

https://www.unbiased.co.uk/financial-adviser/ifa-qualifications

https://www.moneyadviceservice.org.uk/en/articles/key-questions-to-ask-your-financial-adviser

https://www.gov.uk/tax-on-your-private-pension/lifetime-allowance

dunstonh

Are there any particular qualifications / qualities that one should look for?

no.

Are there any particular screening questions one should ask to determine how suitable a prospective IFA is ?

Based on forum posts and research, it appears that many people end up seeing an FA rather than IFA despite thinking that person is an IFA. So, be clear that they are IFAs.

However now that we have to make a commitment I'm realising that I know very little about IFAs and their qualifications.

To be an IFA you have to be qualified. So, what do you want to know?

Ray_Singh-Blue

Do you have an accountant who could point you in the right direction, or a trusted/respected colleague who has been around the block a few times?

Aegis

jscol wrote: »

We both in our 40's. Mortgage paid off and have some savings and investments.
I pay 60% tax equivalent. I reckon I on course to go over the LTA for my work pension but can't be absolutely sure.
My wife pays 20% tax.
We interested in using additional pension to get the tax relief.
Don't know whether to do it in her name and get 20% tax relief. Or my name and get more tax relief but accept punitive tax for exceeding LTA in due course.

I felt sufficiently complicated that we needed IFA. ?

With the situation as described, you will likely want an IFA who is very familiar with running projections, so they either need to be familiar with cashflow forecasting software or good at putting together spreadsheets in Excel. The questions I would ask might therefore relate to how the IFA might predict and manage your lifetime allowance issue, and you can see if he makes any reference to projections.

Some advisers out there are a little too focused on the present, and will only talk about the tax relief available now, which is fine to an extent (60% tax relief now is worth paying up to 55% tax later), but they should also be able to talk about what options are available to you to minimise this impact and how they will calculate when those options need to be considered.

Just to complicate matters, a good adviser also needs to understand that cashflow forecasting is going to be inaccurate in some manner, so they need to be using it as a guide and not some sort of completely rigid plan.

PeacefulWaters

Ray_Singh-Blue wrote: »

Do you have an accountant who could point you in the right direction?

Having seen accountants representing self employed people never once suggest their client doing something about pension, despite the tax benefits, I don't think I'd want to be guided by one when it comes to IFA selection.

racey

dunstonh wrote: »

To be an IFA you have to be qualified. So, what do you want to know?

What is the qualification to be an IFA?

HappyHarry

racey wrote: »

What is the qualification to be an IFA?

The minimum requirement to be a Financial Adviser is to have a level 4 (diploma) qualification in financial planning and hold a Statement of Professional Standing (SPS) issued by an appropriate professional body.

The most popular professional bodies are the PFS /CII and LIBF (previously IFS).

Level 6 qualifications are at a higher level (PFS/CII - Chartered and LIBF - Certified), and advisers with those qualifications are likely to charge higher fees.

An Independent Financial Adviser (IFA) is free from any restrictions that could affect the advisers’ ability to recommend what is best for the customer.

The adviser will either be "independent" or "restricted". There is no half-way house.

racey

Looking at companies found by "Unbiased" I can see advisers with "DipFA" after their name. Another has DipPFS. Does that mean that they are IFAs?
It's not as obvious as, say, Chartered Accountants' qualifications.