Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@. Skimlinks & other affiliated links are turned on

Search
  • FIRST POST
    • naive investor
    • By naive investor 7th Jul 17, 11:59 AM
    • 6Posts
    • 1Thanks
    naive investor
    IFA Increasing my charges
    • #1
    • 7th Jul 17, 11:59 AM
    IFA Increasing my charges 7th Jul 17 at 11:59 AM
    For years IFA has charged 1% on new investments and annual 0.5%. He now tells me that other customers are paying 0.75% and that in order that they are 'Treating Customers Fairly' they must increase my fees.

    We have say 200K invested and increasing by 20k a year isa and the growth of value of the pot. So he earns £ 1200 per anum from us. The new charge would make that £1700

    In exchange we get an annual two hour consultation and a rebalance of the portfolio. (The portfolio is a standard one though unique to their company). They use Fidelity as a platform.

    Now I know his services have to be paid for but this straw may break the camel's back!

    Even if I renew, I think I may open a separate Fidelity 'unadvised' account and self invest other cash, pension and ISA contributions and a future SIPP in that rather than through him (though using his advice which I consider I will have paid for). In short I think this is a bad move for us both. He is going to end up losing money even if I stay.

    What should I do?
Page 1
    • jimjames
    • By jimjames 7th Jul 17, 12:23 PM
    • 11,898 Posts
    • 10,282 Thanks
    jimjames
    • #2
    • 7th Jul 17, 12:23 PM
    • #2
    • 7th Jul 17, 12:23 PM
    Personally I would stop paying and do your own research, you could even maintain the portfolio based on the existing proportions but it's a lot of money to pay each year if you're not really getting a lot of benefit
    Remember the saying: if it looks too good to be true it almost certainly is.
    • bostonerimus
    • By bostonerimus 7th Jul 17, 12:43 PM
    • 506 Posts
    • 248 Thanks
    bostonerimus
    • #3
    • 7th Jul 17, 12:43 PM
    • #3
    • 7th Jul 17, 12:43 PM
    I agree, drop the IFA and go DIY....either use the existing portfolio and allocations as a template or maybe even look to save more money if you have actively managed funds by replacing them with some trackers.
    Misanthrope in search of similar for mutual loathing
    • Malthusian
    • By Malthusian 7th Jul 17, 3:52 PM
    • 2,387 Posts
    • 3,312 Thanks
    Malthusian
    • #4
    • 7th Jul 17, 3:52 PM
    • #4
    • 7th Jul 17, 3:52 PM
    Even if I renew, I think I may open a separate Fidelity 'unadvised' account and self invest other cash, pension and ISA contributions and a future SIPP in that rather than through him (though using his advice which I consider I will have paid for).
    Originally posted by naive investor
    A rather pointless halfway house - he can't advise you properly if you have investments you're not telling him about, as he doesn't have a true picture of the extent of your assets, how much you can afford to invest, how diverse your portfolio is, etc. If you're going to go DIY then go DIY.

    Are you sure he's an Independent Financial Adviser? It is possible for an IFA to use a single platform and set of model portfolios as long as they have properly considered and discounted all the other options, but an IFA who does that has a tenuous grip on the label. Check that he isn't a Restricted adviser.

    The bit about 'Treating Customers Fairly' is just flimflam though you can't blame a guy for trying to deflect blame for putting the prices up. There is no regulation whatsoever that would prevent him keeping you on 0.5% and new customers on 0.75%. He is putting the price up because he wants to maintain his profit margin and he thinks you'll pay it.

    What you should do is simple: If you're happy with him and think it's worth another 0.25% a year, pay it; if you're not, find another IFA who charges 0.5% (plenty still do); if you don't want advice at all, go DIY.
    • cloud_dog
    • By cloud_dog 7th Jul 17, 4:38 PM
    • 3,067 Posts
    • 1,648 Thanks
    cloud_dog
    • #5
    • 7th Jul 17, 4:38 PM
    • #5
    • 7th Jul 17, 4:38 PM
    For years IFA has charged 1% on new investments and annual 0.5%. He now tells me that other customers are paying 0.75% and that in order that they are 'Treating Customers Fairly' they must increase my fees.
    Originally posted by naive investor
    I would congratulate the advisor and or firm for their new ambitious and worthy mission statement and that you are willing to assist them in achieving their cause by moving your assets elsewhere; are there any forms they need you to sign?
    Personal Responsibility - Sad but True

    Sometimes.... I am like a dog with a bone
    • EdSwippet
    • By EdSwippet 7th Jul 17, 7:46 PM
    • 486 Posts
    • 451 Thanks
    EdSwippet
    • #6
    • 7th Jul 17, 7:46 PM
    • #6
    • 7th Jul 17, 7:46 PM
    For years IFA has charged 1% on new investments and annual 0.5%. He now tells me that other customers are paying 0.75% and that in order that they are 'Treating Customers Fairly' they must increase my fees.
    Originally posted by naive investor
    Reducing his other customers' fees to 0.5% also fully meets your IFA's claimed goal of 'Treating Customers Fairly.' :-)
    • bigadaj
    • By bigadaj 7th Jul 17, 9:26 PM
    • 9,347 Posts
    • 5,977 Thanks
    bigadaj
    • #7
    • 7th Jul 17, 9:26 PM
    • #7
    • 7th Jul 17, 9:26 PM
    I would congratulate the advisor and or firm for their new ambitious and worthy mission statement and that you are willing to assist them in achieving their cause by moving your assets elsewhere; are there any forms they need you to sign?
    Originally posted by cloud_dog
    And you could explain that given you won't be paying the higher fee, were you to continue after negotiation to pay a lower 0.5% fee this would only act as a drag on his average return from his clients, so would have to leave anyway.
    Last edited by bigadaj; 07-07-2017 at 9:29 PM.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

2,707Posts Today

6,864Users online

Martin's Twitter
  • Byebye! I'm about to stop work & twitter, to instead spend glorious time with Mrs & mini MSE. Wishing u a lovely summer. See u in 10 days.

  • WARNING Did you start Uni in or after 2012? The interest's rising to 6.1%; yet it doesnt work like you think. See https://t.co/IQ8f0Vyetu RT

  • RT @JanaBeee: @MartinSLewis Boris is the anomaly (coffee), the others are versions of normal (beer). Lots of same candidates = vote share d?

  • Follow Martin