Scottish Widows Appointment

Saints2011 · 2 May 2012 at 6:41PM

I arranged a appointment to meet with my local Scottish Widows Financial Advisor in a Lloyds branch today.

I spent about 40mins with him and felt that he wasnt really interested in me, didnt ask many questions nor did I feel he built any kind of rapport or trust in him (got of to a bad start when the business card he gave me had telephone numbers crossed out and a different branch). The information I left with was very little apart from a key facts sheet and a booklet, the rest hes sending out apparently.

I have thought about going to see a IFA but felt again that I would be wasting his or her's time. The reason I have come to this conclusion is because I do not have a lump sum to invest just a regular payment, I am paying £470 into a Cash ISA and wanted to pay £350 into a S&S but have no experience of the stockmarket and wouldnt know where to start.

Now the Lloyds S&S would be Balanced Growth Fund according to my risk profile and according to the booklet would be a intial charge of 2.0% (not sure if thats each month), 1.5%AMC? 0.21%estimated other expenses TER 1.71%, dividents not interest.

I am assuming as a bank this isnt great but how different could or would it be with a IFA dont want to feel unwanted in another appointment with someone else... Or could someone just say do this and this with x :rotfl:or just keep it cash...

Thank you

MoneySaverLog · 2 May 2012 at 7:18PM

As Scottish Widows are part of LBG it's doubtful any investment they suggest is going to be in your own best interests. Think of banks as being there to make money out of you, and so their only real purpose is for saving with them I guess.

You're probably going to be better off opening an account with iii.co.uk and spreading the investment across several index trackers. I'm no expert though I keep hearing time and time again the number one rule is don't go to a bank for investment advice.

xylophone · 2 May 2012 at 7:21PM

Are you getting the best rate on your cash isa? http://www.money.co.uk/savings-accounts/instant-access-savings.htm
Perhaps consider putting the £350 per month into an S&S Isa with the likes of Hargreaves Lansdown?

Maybe the Invesco Perpetual Distribution (Acc units) would be a gentle introduction to investing - it holds a mixture of shares and bonds.

This particular fund pays income as interest monthly - you have a choice of how to treat the tax credit. http://www.hl.co.uk/

As an alternative you might consider a regular investment into an Investment Trust through an ISA. Might be cheaper through Alliance?
http://www.thisismoney.co.uk/money/i...nt-trusts.html

Saints2011 · 7 May 2012 at 11:44PM

Any more input from IFA's please?

pqrdef · 8 May 2012 at 9:43AM

Saints2011 wrote: »

Any more input from IFA's please?

They've got a dilemma. They'd like to pour scorn on the Scottish Widows fund and say they could recommend something much better. But their fee for that would be more than it's worth, especially as their recommendation might not even turn out to be better.

However, the 2% initial charge (£7 a month) is commission to the bank, and so is a chunk of the AMC. This is for "advice" when the advice they're giving you is minimal.

If buying a packaged ISA, look to buy it on a non-advised basis, with no initial charges and a lower AMC.

However, to my mind, all packaged ISAs have the same fatal flaw, and that is their inability to hold cash, which makes it difficult to get out of the market in a hurry if the need arises. Don't go into the market without noting the fire exits. And with a product like the Lloyds/SW, the only way out without losing the ISA wrapper is a cash-mode transfer to a self-select ISA. This could drag on for days while you watch the market plummet.

dunstonh · 8 May 2012 at 10:02AM

They've got a dilemma. They'd like to pour scorn on the Scottish Widows fund and say they could recommend something much better. But their fee for that would be more than it's worth, especially as their recommendation might not even turn out to be better.

Very true. No IFA is likely going to want to give advice as the amount wouldnt justify the advice costs and liability the IFA would take on. Banks, currently (but expected to end) cross subsidise small cases by charging larger cases more. However, even for a bank, your case is tiny and unprofitable.

I would suggest that if you cannot afford to invest at least £1000 then do not invest.

Scottish Widows Appointment

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