Emma Simon
AUTHOR Emma Simon| CREATED 18 Jan 2016
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How clever are financial advisers?

If you’re going to entrust your finances with a professional adviser, you want to be sure they’re up to the job. So what qualifies them to take on such a responsibility?

You don’t see many financial advisers on University Challenge, but they’re a smart bunch. They have to be licensed, have qualifications and undergo regular training.

This not only provides reassurance that you are dealing with a professional, but also helps you choose an adviser best qualified for your needs.

Are you looking for solutions to everyday problems? More in-depth investment advice? Or help in later life? Qualifications will help you decide.

Here are some questions and answers for people considering engaging an adviser.

Starter for 10. How do I know I’m talking to a professional adviser? What qualifications do they need?

Financial advisers have to obtain basic qualifications before they are allowed to recommend products or investment ideas to consumers. Confusingly, this basic level is known as a ‘level 4’ qualification.

This is the equivalent of taking the first year of a degree at university. So there’s a considerable amount of work to do. It’s not just a case of a swotting up financial terms and sitting a multiple choice exam.

Patrick Connolly, chartered financial planner with Chase de Vere, says this basic qualification is harder now than it was in the past. This means advisers have a more comprehensive knowledge of different financial products and who they might be suitable for.

To find out more about the professional standards that the your adviser has achieved and maintains, ask to see their Statement of Professional Standing.

Are advisers licensed?

Yes. Advisers also need to be approved and authorised by the Financial Conduct Authority (FCA). This ensures they are deemed “fit and proper” to offer advice.

Very good. Now, there seems to be an alphabet-soup of qualifications. What should I look for if I want to talk to a senior adviser at the top of their profession?

Many advisers have additional qualifications over and above level 4 exams. Patrick Connolly says: “We are seeing an increasing number of advisers with Certified or Chartered Financial Planner status.”

This is the equivalent of doing post-graduate training in financial planning. It gives advisers more in-depth knowledge and hands-on experience in dealing with more complex financial situations.

At an initial meeting with an adviser, ask what qualifications they have and how they relate to your specific needs.

Bonus points. Are there specialist advisers?

Yes. Advisers can also choose to specialise – for example, in care fees planning or advice related to the later stages of life. Around 400 advisers in the UK have these specialist qualifications and are accredited to the Society of Later Life Advisers (SOLLA).

Now that really is enough abbreviations. Do advisers undertake ongoing training? I don’t want to talk to someone who qualified when endowment mortgages were all the rage

Yes. Advisers have to show that they take part in ongoing professional training if they want to remain authorised by the FCA. So you are unlikely to meet an Eighties throw-back with shoulder pads and big hair, but you never know.

Want to find out more? See our article on the modern financial adviser.


Emma Simon

financial journalist freelance

Emma Simon is an award-winning consumer journalist with 18 years’ experience writing about money, property, travel and business. She is a former personal finance editor of the Sunday Telegraph, deputy money editor of the Daily Telegraph and personal finance correspondent at the Press Association. She writes for a number of national newspapers, including the Sunday Times, Guardian Online and Mail on Sunday. She has recently written a guide to retirement for the Rough Guide series, and has put together reports and publications for major companies and consumer organisations including Alliance Trust, Fidelity and the British Bankers’ Association.