Evaluate the Value of Your Financial Adviser During a Crisis

There is no doubt that the past year has been significantly challenging for us all. Not least for British expats who are residing in a European country.

With the unique combination of a global pandemic and the UK’s departure from the EU, having sound, professional advice to manage your wealth appropriately is bound to have far-reaching benefits, long into the future.

Here we’ll explore the key questions you can ask, to assess whether you have received real added value from your adviser during such a difficult period, and what you can do should that not be the case.

Identifying the Benchmark for Outstanding Financial Advice

During an international period of tremendous change, financial advisory standards become crucial to stabilising investments and making educated decisions about managing your portfolio.

Brexit introduces some fundamental changes, such as:

• Removing entitlement to exemptions and reduced tax rates available to EU citizens.
• Changes to pension overseas transfers and taxation charges.
• Succession planning strategies and tax liabilities for your beneficiaries.

These areas can be complex, and with swiftly changing legislation, and new regulations in multiple nations to consider, the value of your financial advice is significant.

This is not a time to go it alone when making long-term decisions, or choosing an investment strategy to offset any losses due to the economic downturn.

What you shouldn’t be experiencing is:

• Radio silence from your adviser during the COVID-19 outbreak.
• Lack of responses to concerns, queries or problems.
• Slow reactions, resulting in the loss of a potential opportunity.
• Poor portfolio performance – impacted by any number of existing situations.

In any of these cases, the first thing to do is evaluate whether the financial advice you are receiving is fit for purpose.

Building Communication with Your Financial Adviser During the Pandemic 

No doubt, some consultants have experienced challenges adapting to remote working, liaising digitally with clients worldwide.

That said, there are many ways to arrange a discussion if you are concerned about your portfolio performance:

• Digital communications are possible via video call using programmes including Skype, Zoom, Teams and What’s App.
• Monthly performance reports can be delivered via email, with video calls or presentations to clarify any critical information.
• Virtual offices often have the same access to markets, economic activity and investment platforms, albeit away from a central hub as usual.

Online meetings, reporting and consultations are all possible, even for financial advisers working with clients overseas.

While we cannot always meet in person or travel across borders, your adviser must remain in contact, particularly during a time of such significant flux that may dramatically change your investment strategy.

Assessing How Coronavirus has Impacted Your Portfolio Performance

We’ve published information before about how to identify ‘hidden’ fees in your portfolio management costs – but this widespread problem is always worth mentioning.

Millions of expats are currently looking at damage limitation, complete diversification, or essential product transfers to protect their assets. During such a time of change, your financial adviser needs to step up to the plate and make considered decisions, always based on your portfolio aspirations and risk appetite.

To achieve the best outcomes you require:

• Expedited action and fast decision-making.
• Updated knowledge of new regulations and rules.
• Consistent communication to align your portfolio with your plans.
• Cost-effective advice that delivers value for money.

Behind all of those key requirements, and crucial expectations from your financial adviser also sits the question of fee transparency.

Of course, not all advice is created equal. Choosing the best wealth management team with substantial experience managing finances for clients with similar situations is worth far more than lower-cost advice that is not specific to your needs.

Hidden costs are still a critical concern for wealth management professionals, and back in 2017 it was identified that of survey respondents:

• 28% did not consider the fees when deciding which investment accounts to select.
• 31% were unsure if their financial advisers were legally obligated to act in their best interests.
• 32% felt that higher fees would result in higher returns.
• 21% did not know what they were paying in investment charges.
• 10% could not say whether they pay any fees on investment accounts.
• 45% of respondents who did not seek independent advice did so because of a lack of trust.

These figures may be startling, but demonstrate the underlying problem with hidden charges, lack of clarity on fee structures, and variances throughout the financial advice industry between when, and how much, professionals charge.

Solving Wealth Management Challenges Post-Brexit

As ever, there is no ‘one size fits all’ approach, and the right decisions for your portfolio are entirely dependent on your risk exposure, key priorities, and financial stability.

Some of the popular options currently available include:

• Establishing a ‘rainy day fund’ as a contingency and investment reserve pot to guard against a protracted recovery from the pandemic.
• Opting for longer-term, stable investments until trading returns to normal conditions.
• Avoiding attempts to time the markets given current volatility, and instead taking more risk-averse decisions with robust strategies.
• Working on budget planning in sufficient detail to assess the value of retirement investments and identifying ways to provide for any gaps.
• Putting in place greater cover for unexpected situations, including products such as ill-health, critical illness, and life cover.
• Restructuring succession planning, particularly for expats living in Europe and affected by new overseas taxes or allowances.

If you are in any doubt as to whether you are paying appropriate fees, or have been left in limbo during the pandemic without regular performance updates, it may well be time to consider a change.

The Chase Buchanan teams across the UK, Europe, America and Canada offer a free portfolio review and cost analysis service, designed to shed light on your payable fees, and whether they represent good value. Get in touch to arrange a convenient time for a call to discuss your circumstances, and get your wealth and assets back under firm control.

*Information correct as at January 2021