How to find a decent IFA - or best not to?

Options
1246

Comments

  • dunstonh
    dunstonh Posts: 116,371 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Options
    Undervalued wrote: »
    No, not at all.

    As I tried to explain, I am quite willing to pay for the right advice. What I am not willing to do is to be mislead (to put it kindly) about the total costs.

    Now it may be that they relied on clients using that platform (which only the IFA could administer) and what they earned from that subsidised the advice charges and only then was the job worthwhile. But if so they should have said so. To tell a potential client something which ten minutes online research could disprove strikes me as either naive or dishonest. Neither are characteristics that I am prepared to tolerate in somebody I am paying to advise me.


    The adviser cannot earn from the platform. Commission is not allowed. They can collect your fee from the platform but it is deducted from your account on an explicit basis. Where there is a commission, this would be rebated or offset against the fee.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Undervalued
    Undervalued Posts: 8,852 Forumite
    First Anniversary Name Dropper First Post
    Options
    TheTracker wrote: »
    It all comes back to what independent financial advice you want? A plumber or carpenter or architect has many services. Plenty of reasons to use an IFA... Tbh sounds like just a bunch of complaints so far.

    No, not a "bunch of complaints" at all.

    IFA one (about ten years ago) took several days longer than they should have done to handle an investment. The market shot up during that time leaving me many hundreds of pounds out of pocket.

    I complained, they tried to duck the issue, I persisted, they eventually gave in and refunded me in full for my losses. I then walked away. Had they admitted the mistake immediately I would probably have given them a second chance.

    IFA two (roughly five years ago) gave me provably false information. At that point I had not signed anything so there was no complaint as such.
  • dunstonh
    dunstonh Posts: 116,371 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Options
    Undervalued wrote: »
    No, not a "bunch of complaints" at all.

    IFA one (about ten years ago) took several days longer than they should have done to handle an investment. The market shot up during that time leaving me many hundreds of pounds out of pocket.

    I complained, they tried to duck the issue, I persisted, they eventually gave in and refunded me in full for my losses. I then walked away. Had they admitted the mistake immediately I would probably have given them a second chance.

    IFA two (roughly five years ago) gave me provably false information. At that point I had not signed anything so there was no complaint as such.

    IFA 1 probably rolled over and paid out as the amount to settle was low. A couple of days is nothing. Yet you complained about it. You seem to be high maintenance. Maybe I have just become too accustomed to being in Norfolk.

    IFA 2 didnt really give you false information. 5 years ago, using an IFA on a platform was cheaper than investing directly with the fund house. There were fewer DIY platforms available then and they were not as popular now. They would have been cheaper but not by much as a bottom line and excluding the cost of advice, they would have been more expensive (as the bundled platforms that were available 5 years ago kept part of the advice commission for themselves).

    If we ignore your experience with 0.009% of current advisers, you are still going to hit the snag that intermediaries use products and providers that supply intermediaries. DIY products/providers supply the DIY market and are not built to be used by intermediaries. So, no adviser is going to be able to satisfy you.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Undervalued
    Undervalued Posts: 8,852 Forumite
    First Anniversary Name Dropper First Post
    Options
    OK guys, thanks for the advice on here. It is appreciated and I will give it some serious thought.

    We will have to agree to differ about whether I am "high maintenance" or whether I have been unlucky and run into a couple of "low specification" IFAs!

    :rotfl:
  • Procrastinater
    Procrastinater Posts: 433 Forumite
    First Post First Anniversary Combo Breaker
    Options
    Undervalued wrote: »
    Well mine obviously!

    However I have no problem with how much they make, providing it is cost effective for me compared with realistic alternatives.

    It is a bit like if I want some home maintenance or car repair work doing. If I am not confident in my own skills my choices are:-

    Spend time and energy learning then do the job

    or

    Pay somebody who has the necessary skills

    Assuming both lead to a satisfactory result it comes down to how much I value my time and whether I enjoy spending my time in that way.

    According to Alexander Elder, "Learning to trade will cost you as much as a good college Education..."

    http://www.amazon.co.uk/Trading-Living-Psychology-Tactics-Management/dp/0471592242/ref=sr_1_4?s=books&ie=UTF8&qid=1454956345&sr=1-4&keywords=alexander+elder

    The IFA's I have met and listened to leave me absolutely cold as to their LACK of knowledge !
  • dunstonh
    dunstonh Posts: 116,371 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Options
    Procrastinater wrote: »
    According to Alexander Elder, "Learning to trade will cost you as much as a good college Education..."

    http://www.amazon.co.uk/Trading-Living-Psychology-Tactics-Management/dp/0471592242/ref=sr_1_4?s=books&ie=UTF8&qid=1454956345&sr=1-4&keywords=alexander+elder

    The IFA's I have met and listened to leave me absolutely cold as to their LACK of knowledge !

    And why should have an in depth knowledge about trading when it has nothing to do with their role?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Malthusian
    Malthusian Posts: 10,938 Forumite
    First Anniversary First Post Name Dropper Photogenic
    Options
    According to Alexander Elder, "Learning to trade will cost you as much as a good college Education..."

    Well if you pay £52 for a book on how to gamble on short-term market movements you're certainly on the way there.

    For £45 I'll give you directions to the nearest Ladbrokes. Bargain.
  • Procrastinater
    Procrastinater Posts: 433 Forumite
    First Post First Anniversary Combo Breaker
    Options
    Malthusian wrote: »
    Well if you pay £52 for a book on how to gamble on short-term market movements you're certainly on the way there.

    For £45 I'll give you directions to the nearest Ladbrokes. Bargain.

    Not all trading is short-term and all "investment" in shares is "Gambling"
  • BananaRepublic
    BananaRepublic Posts: 2,103 Forumite
    First Anniversary Name Dropper Combo Breaker First Post
    Options
    Undervalued wrote: »
    A couple of times in the last ten years or so I have felt I could benefit from using a decent IFA. Neither has ended well so I am very torn as to whether to try again.

    In the past I have run my own business and been treasurer for a organisation with a seven figure turnover so I am reasonably financially literate. I also worked in a field that required great accuracy and integrity.

    Briefly, the problems in the past have been:-

    IFA one rather lost my confidence by producing inaccurate paperwork then took far longer than they should have done handle several transactions. This was in a rapidly moving market and cost me a significant amount of money. They tried to deny responsibility but eventually paid compensation and refunded their fees.

    IFA two wanted to use a particular platform (maybe Co-Funds ??) and gave me very misleading advice about the total costs involved. I was quite happy to pay a fee for their time and advice as to what to buy. However I was not willing to be mislead (lied to basically) about the initial fund charges being cheaper through them when in fact the reverse was the case.

    So currently I am using a self administered platform with a portfolio based partly on the funds IFA two was recommending and partly on my own research.

    I have no real expertise in market research so I keep wondering:-

    Should I have another go at buying some pure advice from time to time in the hope that will be cost effective? If so how do I find the right person / firm?

    or

    Would I just be better using one of the online platform's "ready made" portfolios and save the IFA fees?

    Thoughts would be appreciated.

    Were you wanting overall guidance about investments, perhaps involving inheritances, trusts for children, and so on, then an IFA would be one way to proceed. But it sounds like you want advice about which funds to invest. And it sounds like you are numerate and intelligent and you have a willingness to learn. In that case I would think you would be better off doing your own research. Whatever an IFA may tell you, the market is inherently unpredictable and they do not have a magic wand. If you are not already familiar with the basics of investment, stock markets, and so on, then you would do well to spend some time reading. There are good books from organisations such as Which, and good online guides. It may well take no more time than travelling to meet an IFA, and talking with them. Of course if after doing research you might end up deciding you'd like someone else to make the decisions for you. But honestly successful investing is not rocket science.

    Incidentally I have also had a poor experience with three IFAs, albeit very briefly in one case. All tried very hard to be my best friend, but I ended up having zero trust in them. One of them released my personal financial details to co-workers, which caused huge problems for me.
  • Malthusian
    Malthusian Posts: 10,938 Forumite
    First Anniversary First Post Name Dropper Photogenic
    Options
    Procrastinater wrote:
    Not all trading is short-term and all "investment" in shares is "Gambling"

    No, but the kind recommended by Alexander Elder and his ilk is.

    "Trading" is generally understood to mean short term. The word implies constant buying and selling.
    BananaRepublic wrote:
    Whatever an IFA may tell you, the market is inherently unpredictable and they do not have a magic wand.

    Every, and I mean every, reputable IFA will tell you exactly the same thing. In fact dampening people's expectations as to what they can do is a large part of their job. There is of course the odd charlatan as there is in any profession.
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

Categories

  • All Categories
  • 343.2K Banking & Borrowing
  • 250.1K Reduce Debt & Boost Income
  • 449.7K Spending & Discounts
  • 235.3K Work, Benefits & Business
  • 608K Mortgages, Homes & Bills
  • 173.1K Life & Family
  • 247.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards