Majority of expats in the Gulf rule out financial advice in first two years

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JEDDAH — Almost two thirds of expats don’t seek financial advice in their first two years in the Gulf, new research finds.

Only 37% of expats living in the Gulf seek and receive financial advice within their first two years living in the region, research from Abu-Dhabi based independent financial advisory firm Hoxton Capital Management.

The results of the survey (which had 1,126 respondents) shows that the amount of expats receiving advice varies depending on how long they have been living abroad. Those living abroad for more than two years seem to start think more closely about their financial planning accordingly. Indeed, the Hoxton research found that 74% of expats who have been abroad for more than two years, have in some format discussed their finances with a professional. Unfortunately, out of this 74%, almost half were unimpressed with the advisor or the quality of the advice given.

“If you are looking for financial advice, the importance of doing your due diligence can not be overstated," explained Hoxton managing partner Chris Ball.

"There is a clear difference between those receiving advice and those who do not. On average people who receive advice get an increased return of 2% per annum on their portfolio compared with those who do not. So if investor A, who invests on their own makes 3% in a year, investor B who has a good advisor will make 5%.

"This may not seem like a huge difference but when compounded over time it equates to a substantial amount. If investor A has £100,000 and leaves it invested for 20 years at an average annual return of 5%, they will have £265,000 at the end of 20 years. Investor B who received advice on the same amount over the same time would have £386,000 by the end of 20 years."

In addition to checking out the background, experience and regulation of the company and its individuals, Ball advises expats to look for transparency when searching for a financial adviser, saying that all information about your selected advisor should be extremely easy to find, including existing client reviews.

Ball offers the following tips for easy to find information:

• Check the advisor’s LinkedIn Profile – it should be open and visible with a clear employment history and existing client reviews.

• Check their company website – all employees should be listed on the team page. Firms that do not have this typically have very high staff turnover and loose employment policies.

Check their TrustPilot. If they do not have a TrustPilot score or have a low one, avoid them.

Use Google to search the company for reviews – as with any business that is doing its best, it is still likely someone somewhere will have a negative experience. However, failure to find anything positive should ring alarm bells.

• Google the individual advisor.

Hoxton Capital Management is an independent financial advisory consultancy providing personal financial advice to expatriate clients living globally. Founded by UK qualified financial advisers, Hoxton Capital Management has offices in London and Abu Dhabi. — SG


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