Throughout your life you are likely to need different types of financial advice and not every adviser in Dubai is suited to every eventuality.
Think of taking financial advice like going to a doctor - some are GPs with a broad knowledge about a lot of conditions, while others are consultants who specialise in a specific discipline.
That’s why it’s important to match the advice you need with the adviser best suited to your needs.
Finding a financial adviser
Personal recommendation is always a good start when looking for a financial adviser in Dubai, but don’t forget it may take years to find out if that person has done a good job and being nice does not make you the best financial adviser.
Financial advisers often have a flood of letters after their names - and here are some to consider in Dubai if you are looking for specific advice:
- Pension and retirement advice, discussions about long term care, equity release, wills and inheritance tax - SOLLA (Society of Later Life Advisers) or STEP (Society of Trust and Estate Planners)
- Mortgages, life insurance, investments and general financial planning - look for qualifications with the Chartered Institute for Securities and Investments (CISI) or the Personal Finance Society
- House, car, holiday or other specialist general insurances - You need a member of the British Insurance Brokers Association (BIBA)
All financial advisers in Dubai should have a minimum QCF Level 4 standard of qualification. Some have taken extra exams up to QCF Level 8 - the higher the level number, the better qualified the adviser becomes.
What makes a financial adviser independent?
It’s vital you understand the difference between the three different types of financial advisers, so you know who you are dealing with and what their advice restrictions are.
- Independent financial advisers (IFAs) - An independent financial adviser is not ‘tied’ to any provider, so can give advice about any product on the market.
An IFA should help you draft a bespoke strategy that matches your financial goals.
IFAs are sometimes described as holistic, which means they can give unbiased advice on all your financial needs.
- Multi-tied advisers - A fudge between IFAs and tied advisers. A multi-tied adviser can only advise on products and services related to the providers they are tied to. This is called ‘restricted advice’.
Basically, if there are better products and services out there, they can’t tell you like an IFA can, which means you could end up with a deal that does not best meet your financial objectives.
- Tied advisers - Like a multi-tied adviser, a tied agent can only discuss the products and services of a single provider, ignoring the rest of the market.
Questions to ask your financial adviser
If you must make a choice from two or three financial advisers in Dubai, it’s a good idea to try and benchmark them so you can make a choice based on the same information provided by each.
Here’s a set of questions to ask any potential adviser:
How much will your advice cost?
Financial advisers must tell you this in advance of offering advice. They are no longer allowed to accept commission and will charge you for their time.
Some work from a fixed fee, while others charge hourly rates or a percentage of the money they are investing for you.
A fixed fee is good as you know the upper limit of what you will pay, while the other arrangements are open-ended.
Expect to pay your financial adviser between £75 and £350 an hour. The average is £150.
Are you independent?
The adviser must tell you what services they can offer, if they are independent and if they are restricted in giving advice.
Is your advice restricted?
This should root out any multi-tied or tied agents who cannot give whole of the market advice
What is your qualification?
Ask for their QCF level - the minimum is QCF Level 4 and the highest is QCF Level 8.
Do you give ongoing advice?
Your financial needs will change over time, so you need an adviser who will review your strategy every two years.
How to choose your financial adviser
Never choose a financial adviser on price alone - service, advice and range of products is much more important in the long term.
The best way to choose a financial adviser in Dubai is to forget the cost and make a list of the advice and services you want your adviser to provide.
Ask at least three advisers to quote asking the questions listed above.
If the costs are roughly the same, have a chat with each one and decide from there.
If the costs vary widely, look if you need all the services you have asked for and try to negotiate a price nearer your budget.