The Money Advice Service is a Government initiative, helping you to feel good about money. This advert has created at bit of a stir amongst financial advisers. A variety of reasons for IFAs to chuckle – or perhaps do a Victor Meldrew.

The Money Advice Service is not free, it is free at point of use. It actually costs £43.7m which is paid for from some of the annual fees that financial advisers pay each year. Unfortunately, the language used is unhelpful.  The provision of financial advice goes hand in hand with the responsibility for it, something that MAS will not be taking. The term “Independent” can only be used in a financial advice context by Independent Financial Advisers. The suggestion that something is free and is therefore better, is surely a fools economy. No advice is really free. Free financial advice has arguably been the most costly of all, when you consider the scandals within the financial services industry over the years. Free advice of any kind is not really free, someone is paying for it somewhere, or they are using the opportunity to persuade you to buy something else…or just something. Any business or charity providing free anything without any notion of cost is delusional and unsustainable.

The proverbial elephant in the room (and several rather helpfully appear in their own advert) is that from 2013 it is going to be harder for most people to get impartial financial planning advice. Advisers have all been told to do more exams and charge fees from 2013… which I won’t bore you any further with (since I’ve been doing this since 1999). Mind you the powers that be are in collective denial about the problem – so nothing new there then. Of course, the MAS is probably a partial solution for some people and I hope it will be a useful educational resource – which is really what the average person needs more help with. Clients of financial planners are generally a pretty savy bunch…like an elite sportsperson but in their own field of expertise. However, being such doesn’t make them master of everything – and even the top sports people (and business people) have a coach.. which suggests that the right advice is going to add advantage, which is presumably something that has a value and therefore a price.

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