For Your Information
There is more than one type of financial adviser. Not all advisers can give you advice on all the products available.
- Independent financial advisers. These advisers provide advice on your behalf. If a product needs to be recommended, they can choose from all those available to pick the one which will best suit your needs.
- Multi-tied advisers. These can only sell products from a limited number of companies - the ones to which they are "tied". They still have to find the best product in their range to suit you.
- Tied advisers. These can only sell products from one financial company to which they are "tied" and are usually employed by that company. They too can only sell a limited range of products, although they have to find the best one in their range for you.
Anyone giving advice on savings and investments, pensions, insurance or mortgages is under the eye of a watchdog, the Financial Services Authority.
All financial advisers operate in a highly regulated market. They have to be registered with the Financial Services Authority and are required to have appropriate training.
The Financial Services Authority not only have a register of who can give advice. They have also put in place procedures all financial advisers have to go through, and they watch out to make sure the rules are being followed.
If we had chosen to take the ‘limited range’ option, this would normally produce a higher commission rate, as those Providers on the selected ‘panel’ would be receiving a larger share of our Firm’s business. For the same reason, the ‘tied’ route would normally produce an even higher rate, as only the products of the one provider could then be recommended and sold. In general terms, the higher the commission rate paid to the adviser, the higher the charges built in to the product are for you, the customer.
