Positive industry shake-up is just business as usual for Gaeia

The way we go about getting financial advice is changing for the better, modernising how advisers work, raising professional standards and ensuring consumers get a fair deal. This is all part of an industry shake-up following the FCA’s Retail Distribution Review (RDR) which took effect on 31 December 2012. So what does this mean for Gaeia clients? Well, actually it’s business as usual...because we’ve long worked in this way. For some firms, however, the system unfortunately hasn’t always worked and it hasn’t always been clear how you paid for financial advice. There was always the chance you could be sold a product that earned your adviser the most money. Across the industry, you’ll see the following improvements, which mean you will: 1. Agree with your adviser how much you pay Financial advice has never been free. This may come as a surprise to some people who weren’t fully aware of the commission they were paying on their investments. Advisers will no longer be paid by commission but will instead have to agree with their clients upfront how much their advice will cost. At Gaeia we’ve always operated an honest and transparent approach. We agree with you our fee basis and charges upfront before proceeding with any advice. You’ll have the flexibility to pay for the advice based either on the number of hours it takes to provide the advice, or as a percentage of your investment. You may agree with your adviser to pay for this fee separately or have it taken from your investment. Advisers can continue to receive commission for advice they’ve previously given. This is known as ‘trail commission’ and means the adviser will continue to be paid commission on products sold before 31 December 2012. 2. Know what service you’re paying for The second change means you’ll know what type of investments your adviser can help with, as they’ll have to explain to you whether they’re offering ‘independent’ or ‘restricted’ advice. Advisers like Gaeia, offering independent advice, will be able to consider all possible investment options that may suit your needs. They can also look at financial products from all firms across the market. However, an adviser offering restricted advice will consider specific types of products, product providers or both. 3. Get improved professional standards There are so many places to invest your money and the myriad of options can be complex, not to mention keeping up with all the latest developments. Therefore, when seeking help from a financial adviser, you want to know they have the expertise to advise you. From 1 January 2013 advisers must meet higher qualification standards than ever before, keep their market knowledge up to date and sign an agreement that requires them to treat you fairly. All Gaeia advisers achieved the required Diploma level qualification standard some time ago. Posted by Pippa Oldfield CGLPOBlog/100113

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