While independent financial advisors offer plenty of help to those looking to maximise their wealth, it isn’t surprising to know that many people do not trust IFAs. After all, not many want to place the hopes of their financial future into someone else’s hands. However, this isn’t the only reason people do not trust IFAs. Independent financial advisors have also made the problem worse by offering solutions that aren’t backed up with good explanations. For example, what would you say if someone told you to invest in something and not say why? You would more than likely doubt their advice. This is malpractice on the IFA’s side, and more often than not, leads to mis-selling that has hurt many client’s financial standing.
In this article, we’ll delve deeper into the lack of trust with IFAs, and what you can do if you were mis-sold a product in the past.
Why people do not trust IFAs
As we’ve mentioned earlier, flimsy solutions without explanations offered by IFAs are a big reason many people do not trust them. What makes things worse is that many of those who still heed the IFA’s advice end up losing money. This further demotivates individuals to work with IFAs to improve their wealth, creating a cloud of doubt amongst many people. However, the problem doesn’t end there. High fees charged by the IFAs didn’t help in making their services attractive. Many of those who need financial advice find that the cost of hiring an IFA is just too expensive to be near worth it.
How the industry responded to the problem
These problems are a huge issue for the industry, simply because without trust, no business can be done. To make things challenging, the fact that one bad IFA can cause a handful of other IFAs to lose their clients makes this problem more severe. As such, the industry has tried to respond by creating standards and rules for practising financial advising.
The FCA (Financial Conduct Authority) has spent a significant amount of time and effort identifying the problematic practices. The media has also helped by highlighting mis-selling cases to reduce the likelihood that an IFA ends up committing the same problems.
What one can do if you were mis-sold a financial product
Fortunately, if anyone falls victim to a lousy IFA’s financial product, there’s still hope to reclaim what was lost. Victims of mis-sold products could opt for reclaiming services if they were pressured into buying a financial product, bought something that wasn’t properly explained, weren’t assessed for risk attitude, didn’t receive an explanation of the product’s risk level, and more. One can also receive compensation if they weren’t given the full range of products or that their situation wasn’t considered when the financial product was offered.
If anyone has experienced any of the above scenarios and lost money because of it, they might be eligible for compensation.
Conclusion
It is troublesome to know that not all IFAs can be trusted with your money. Some will put your needs as their priority, while others simply offer their services to make money. Fortunately, the industry has been working hard to fight off bad IFA practices. With that in mind, if you have been a victim of any of the bad practices, then consider claiming compensation. Reach out to trustworthy claiming services that specialise in mis-sold goods, and let them help you claim back the compensation you deserve!
Consumer Reclaim specialises in consumer mis-selling of goods, insurance, and services. If you are looking to claim for mis-sold services in the UK, work with us today!