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Savings Advice Bills Set to Skyrocket

by Dave

Many people, when they have saved up a large amount of money or have had a windfall, are likely to put their money in investments rather than a simple savings account. Although the rate of return might not be as safe or guaranteed, many investment opportunities will have a higher rate of return as long as they are successful.

How do you know which investments to go for though? Many people don’t have the time or inclination to sift through details of investment portfolios and look for which offer the most attractive and secure deals. For them, heading to an independent investment advisor is often a good idea. They can pay for advice that is likely to be more thoroughly researched than any they would do on their own and feel safer about their savings.

However, from the end of this year onwards, the cost of independent investment advisors is set to increase sharply, leaving people who are looking to put their money in a higher yield return than most bank accounts offer to choose between paying a much larger portion of their investment capital to get the advice they want or looking into their investments themselves.

A study by AXA Wealth found that many people who currently use a financial advisor were planning on no longer doing so when the changes come into effect. They will still approach them for what they regard as important decisions, such as setting up a pension, but for small savings and investments they will take a Do It Yourself approach.

The change being made is that financial advisors will no longer be able to rely purely on making a commission on their clients’ investments, but will have to charge for advice they give as well. This should mean better and more sound advice for those seeking it, but it will also create large upfront costs that could put many people off.

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