Three things your clients may call you about this week …

Cost of advice from an IFA can vary by 1,000% 

Accessing financial advice could cost £4,500 more if you opt for one of the most expensive advisers, says this research carried out by Which? for the The Sunday Times.

To find the figures, consumer group Which? surveyed 108 financial advisers and asked them how much they would charge people in various scenarios. In one scenario, a woman approaching retirement who wants advice on drawing an income was quoted £500 for advice by the cheapest adviser - and £5,000 by the most expensive. The advisers were told by the mystery shopper that she had £100,000 in savings, a £150,000 pension pot and £100,000 in an investment ISA. The average quote was £2,540.

A young parent with £60,000 in savings and £40,000 in an investment ISA who wanted advice on saving for their child's university education, meanwhile, was quoted between £300 to £2,500 for the regulated financial advice. The average was £1,060.

"There are a number of benefits to using a financial adviser," Which? Money editor Jenny Ross tells the paper, "but it's important to shop around to find the right adviser for your needs."

Will you be left flat broke by the flat rate pension fiasco? 

An incurable hangover from the old state pension rules is haunting and confusing those heading towards retirement, according to this piece in the Mail on Sunday.

In April 2016 the ‘flat rate' state pension was introduced, so those who accrued all of their national insurance contributions can receive the maximum sum available, which is currently £168.60 a week. The new system applies to those who reached state pension age after April 5 2016, so 1.1 million out of the 13 million people currently claiming the state pension are subject to the new system.

However, the devil is in the detail, says the Mail on Sunday, and many are not always eligible for the new, maximum rate. The newspaper's figures suggest only one-third of those who have retired since April 5 2016 are receiving between £150 and £168.60 a week.

Former pensions minister Ros Altmann says: "The confusion over the new State pension is a classic example of the dangers of complicated pension changes. It prevented people from understanding the changes and misled them into believing they had more State pension to live on than turns out to be the case." 

How AI will change the way you manage your money

This Financial Times article explores how data science is increasingly being used to speed up processes, compare products, find deals and produce tailored answers to customer queries. 

Such data usage brings the prospect of cost savings for customers, the financial ‘paper says, not to mention the companies providing these services. But, while automation can drive down prices and make communication with companies easier, it also holds the potential to make connections between people's finances that were previously more discrete. 

That is all well and good, but the greatest challenge technology faces is whether it can it accurately interpret the human emotions that play a part in setting financial goals and making major money decisions? And, even if it could, would your average Jo(e) be prepared to trust machines when it comes to sharing such personal and valuable financial data? This article in the FT explores those billion-dollar questions.

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• Topics
• Your profession
• Artificial intelligence
• state pension
• The cost of advice