How to pick a financial adviser in Dubai

Updated: Apr 11, 2019

Who are the best financial advisers in Dubai? And how do you go about selecting the right adviser for you?

Regulation in Dubai

The very first thing you need to ensure, is that the firm you are going to be working with is regulated by a proper  financial regulator (i.e., one that enforces high standards and it’s rules)

As an example, in the UK the regulator is the FCA (the Financial Conduct Authority),in the US it is the SEC, in Singapore the MAS and here in Dubai the regulator in the DFSA - the Dubai Financial Services Authority.

Financial adviser/wealth manager Qualifications

Make sure that the financial adviser you are dealing with is professionally qualified to the right standards. This should be at least the equivalent of UK level 4. They should be able to clearly evidence this, alongside a history of providing regulated financial advice. There are over 4,000 financial advisers throughout the UAE and not all of them are properly qualified.

Furthermore if your needs are specific, seek out a specialist in that area. For example if you need inheritance tax planning. Or if you are seeking advice on a pension transfer to a SIPP or a QROP's, make sure the adviser is a Pension Transfer Specialist. They should be an expert on the subject.

Don’t be afraid to ask to see qualifications too. If an adviser has shed blood sweat and tears gaining these qualifications, they will be more than happy to show them to you.

Don't be afriad to ask the adviser plenty of questions. Here are a few staple ones to get you started:

  • What financial qualifications do they have?/ how long have they been giving advice in Dubai and the UAE?

  • How long have they been working as a financial adviser or wealth manager in the offshore market?

  •  What services do they offer?How many clients do they look after/portfolios do they manage?

  • What's the value of the assets they manage?What fees/charges may I incur? (See further infromation on fees below)

  • Can they provide client reccommendations?What area do they specialise in, if any? For example pension transfer advice, Tax planning or inheritance planning.

  • How often will they conduct reviews/ will you have contact ?

  • What happens if you relocate?

  • What is their investment process/typical investment strategy? 

Terms of business and working ethos

You should ensure that you are provided with clear terms of business from the outset and have read and understood them.  You need to make sure what service you will be receiving and also how you will be charged.

When picking an adviser and a firm the company should have an investment philosophy that aligns with your interests.  

How will you be charged?

We are now in the era of the fee based financial planner. Fee-based because it is almost always what’s best for the client. Commission was banned in the UK in 2014 via the Retail Distribution Review and essentially prevents financial advisers making commission from giving advice and recommending investment products and solutions. Currently (2019) many advsiers in Dubai still operate using a commission based model.

Where this model is used, there is more often than not a huge conflict of interest. Are the investment solutions the right ones for you, or for the person/compnay recommending them? A fee-based adviser however, can practice with a much greater degree of objectivity and independence. They cannot be swayed by any personal benefits that may come along with certain recommendations. 

Choosing to work with a fee based adviser will ensure there is no bias in the selection of an investment solution. And most importantly that you will continue to receive good ongoing regular advice, not just a recommendation at outset!

You should talk to your potential adviser about their vision and their core values. The fees therefore should be transparent fees that align the firm’s interests with yours.

Do you need a financial adviser?

Think hard about whether you need advice at all or you’re able to be you own financial adviser. If your situation is simple you may be able to manage your own finances.

There are many books/ internet platforms/apps that can help. From budgeting tools to micro investing or just simple advice on how to build a passive portfolio on your own.

Why use a financial adviser?

Most individuals, do not have the knowledge to be able to make effective financial decisions on their own. And so a good adviser can provide huge value. They are essentially the resource for clients so that they don’t have to worry about this stuff.

If individulas do have the financial knowledge required, they are often so busy with their lives and with work. And even if they do have the time, they probabaly don’t have the desire. Let's face it, there are far more interesting things to do in Dubai!

The majority of people don’t want to spend time with personal finances. It’s a chore. It’s drudgery. They’d much rather be with the kids, relaxing or traveling.

Financial advisers are there to do the hard work for you, so you dont have to.  They are there to help you discover your objectives and desires and to help you put those plans in place to reach your goals.

And chances are, if they are good and you pick the right one - you will be with your adviser for decades, now there’s a huge value to that!

Specifically, financial planners can help to:

  • Help you discover your short/medium/long term objectives

  • Create an investment plan to fit your needs/ risk appetite

  • Guide you through the maze of retirement options pensions, annuities, pension transfer advice on SIPP's and QROP's:

  • IHT /Estate planning

  • Education savings goals

  • Cahsflow planning

  • Help with your Insurance needs

  • Minimize your taxes.Manage risk

  • Improve your overall investment results.

  • Help provide emotional disciplineProvide guidance and support to help you stay on course and reach your long-term goals.

#financial #advice #dubai #uae #expat

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