halifax financial adviser fees.

solis_3

thanks for all your replies. i didnt realise the halifax was held in such poor regard. the reason the halifax suggested medium to low risk funds is because im a very conservative person, i dont really want to risk/lose alot of the money. i live around the dorset/hampshire border can anyone recommend a ifa. dawn

jem16

solis wrote: »

thanks for all your replies. i didnt realise the halifax was held in such poor regard.

Any bank is not the place for investments - savings yes.

Database of IFAs is here - https://www.unbiased.co.uk

paul5046

solis wrote: »

hi all, completely new to this site as ive never had money worries due to the fact that ive never had any until now.
i was left a six figure sum by an aunty 20 years ago which was held by a solicitor, the solicitor duly spent it. after the fraud squad got involved as well as the law society i have now got £1million, with compensation.
The financial advisor at halifax has given me advice and pointed me in the direction of 4 lowish risk funds. the idea is to draw some of the capital per month to live off. anyway the questions i need to know is, for this service/advice the sum they want is £26,000. also for each fund the cost is 1.4% per year, are these charges high or am i being naive. thanks for any help. dawn

26k seems a lot for setting it up. Thats probably worked out as a percentage. I'd ask for a fee based on hourly rate.

paul5046

jem16 wrote: »

Any bank is not the place for investments - savings yes.

Database of IFAs is here - www.unbiased.co.uk

She did say she was conservative. If you put it all into savings you should still get 65k a year in interest and peace of mind.
My 65 year old neghbour was advised to put 150 into shares/funds and lost half in two years. He'll never get that back.

LongTermLurker

paul5046 wrote: »

She did say she was conservative. If you put it all into savings you should still get 65k a year in interest and peace of mind.
My 65 year old neghbour was advised to put 150 into shares/funds and lost half in two years. He'll never get that back.

...and in 20 years the £1m will be worth £500k (in today's money) and that £65k will be worth a little over £32k.

2 years isn't a long time for investments - nobody says it's a get rich quick scheme; there is a certain amout of risk involved. Was your neighbour advised by a bank? If so, that brings us back to the start of the conversation. Losing 50% in 2 years is a bit harsh - it suggests the "advisor" didn't pay too much attention to diversification. Putting all your money into bonds is as bad as putting it all into oil, if you happen to pick a bad year for bonds. Even in today's market, I can see some of my investments have increased in value - not to say I haven't made an overall loss, but they have stopped me losing as much as I could have done.

dunstonh

She did say she was conservative. If you put it all into savings you should still get 65k a year in interest and peace of mind.

As well as an increased tax liability that will see upto 40% tax deducted. That tax deduction allows for some risk to be taken if it can be avoided (and it can be).

My 65 year old neghbour was advised to put 150 into shares/funds and lost half in two years. He'll never get that back.

When? Nobody has lost 50% for a very long time unless they have invested high risk. That sort of loss potential is for medium/high or higher risk profiles and not the cautious.

People that tend to spout on about losing a lot of money like that tend to be DIY investors who invest above their risk profile without understanding about what they are doing. They then pull out at the worst time to crystallise a lose and then stand no chance of recovery.

The last major drop for medium/high risk UK equity was 43% during the tech stocks crash. You would have recovered had you stay put.

Investing is not about choice of cash or stocks and shares. There is a wide range of options available in between.

Investing is about risk profile, diversification, taxation and charges. (Halifax only probably got it right on one of those - risk profile. However, even then they dont have the available fund range to fine tune the risk. 4 funds highlights just how poor it is). You also have to consider the impacts of inflation. Especially when income is required.

LongTermLurker

paul5046 wrote: »

26k seems a lot for setting it up. Thats probably worked out as a percentage. I'd ask for a fee based on hourly rate.

I don't think banks sell on that basis. That's why people are saying don't invest via banks, speak to an (or several) IFA(s).

BTW, unlike some of the respondants, I'm not an IFA and don't even work in the financial industry at all, but like any other skillset, I believe a good professional who knows their job can add value, and I don't believe someone who is blinkered by a handful of funds can do that.

Kavanne

OP, I went through an IFA to invest my inheritance. That was just over 2 yrs ago. At the MOMENT it's down a little (15% on what I originally invested) but you have to realise you are in it for the long haul. I take 5% PA of the money as income each year so really it hasn't done that badly in the current climate (apparently).

IFA has also just contacted me re: review of the situation so we'll see what becomes of that next month!

Just TELL your IFA you want to play it safe and they will do exactly what you ask.

opinions4u

I thought Halifax charged no up front fees and 1.5% pa to 'manage' the fund. I would ask them about this. I doubt they would have advised you badly from the range they have available though.

As for an IFA, I would suggest you find one who will charge a flat fee and rebate any commission to you (or re-invest the sum in your portfolio).

A £2,000 fee could save you mega-bucks.

jem16

opinions4u wrote: »

I thought Halifax charged no up front fees and 1.5% pa to 'manage' the fund. I would ask them about this. I doubt they would have advised you badly from the range they have available though.

Would you be happy to place £1m in just 4 funds?