Financial Advisor That Charges Monthly Fees?

earlgrey_3

MrMicawber wrote: »

Earlgrey - please don't start getting silly. You pick and choose and purposely misinterprete. Debate like a rational person and that's fine but your last sentence is that of a spoilt child. It's the sort of biased rubbish that isn't fit for primary school. In fact your previous sentence isn't much better.

Sorry you're now just being abusive. Is that entirely necessary to make your point? Let's stop the name-calling shall we?

I don't understand your objection to my last sentence but to be frank I would not in any way be interested in your explanation. It's my view that the encouragement by an IFA to invest using borrowed money isn't responsible. See one example here and an explanation of why by Purch: http://forums.moneysavingexpert.com/showthread.html?t=1296973

MrMicawber_2

Earlgrey - WHAT EXACTLY ARE YOU TRYING TO SAY

"Many tied advisers are on a substantial salary schemes plus bonus. Someone the other day insisted that RBS advisers aren't on commission which would surprise me." THIS JUST DOESN'T MAKE SENSE.

"not suggesting you are any worse than others in the industry"

SO YOU DO THINK THE WHOLE INDUSTRY AND EVERYONE IN IT IS ROTTEN TO THE CORE

Come on admit it you must have a personal problem with IFA's.

whiteflag_3

earlgrey wrote: »

are.
Sorry Dunston, I don't want to paint you as a baby-strangler and not suggesting you are any worse than others in the industry,

so why do you persist in give dunstonh hassle? , yet ignore many other posts that challenge your tunnel vision view on financial advisers?

Seems to me you are not willing to get into any debate , just intent on doing down someone who to has a genuine motivation to to the right thing.

earlgrey_3

jem16 wrote: »

The fact that you expect my IFA to have advised moving my investments to cash yet you haven't for valid reasons. The same valid reasons that I have for staying put but reorganising within where appropriate.

Jem, I didn't expect your IFA to move you to cash. How could I when I had no idea of where you were invested. Might have been entirely in gilts for all I knew.

I wasn't making any point. I don't receive any fliers from them persuading me to invest but presumably that's because i don't use their services. I was simply asking if you did in order to receive these fliers.

That's the way it works. If they don't know your address you don't get sent the flyers.

You have a lot of valid points to make but these get lost in the sea of hate that you seem to put across against IFAs.

Thank you but you are mistaken to equate caution with hate. Some of my best friends are IFAs as the saying goes. Just don't assume that the interests of a commission paid IFA will automatically coincide with your own.

dunstonh

Isn't that because there's no comeback for poor returns or encouraging investors to invest at a bad time? Specific mis-selling has to be proved. That's one of the causes for complaint I hear from people who don't seem to understand the limits of the advice they can expect.

There is no comeback for poor performance as performance is always an unknown. There is also no comeback for not having a crystal ball.

Investments are for the long term. Events like this happen. You cant pick and choose when to invest as no-one knows when there is going to be a downturn or how big that downturn is going to be. Equally they dont know when the growth periods will be and how big it will be.

That wasn't my experience some years ago. The tied agent was the most transparently honest of the people I saw. The problem was he himself said he thought the arrangements I had were reasonable and he couldn't offer any improvement. The most obvious problem with tied agents is the limitations of the products they can sell and for that reason should generally be avoided.

The FOS complaints figures (which are published for all to read if they wish) show a different story. You can have a very nice person as a tied agent but the limitation of what they can do will always be a limitation. So, why go to the most expensive type of adviser, with a limited product range?

But their companies with national reputations to protect are.

They are not making a good job of it. The FOS recently stated that 10-12 companies are responsible for the majority of complaints they receieve.

So just like the big companies with tied advisers then?

No. The big company takes the hit. The tied rep doesnt have to declare that complaint to a PI company that will price their risk. The tied rep doesnt have to pay the money out of their own pocket. The owner, partner and directors of the small firms do. So, the tied adviser can sale quite close to the wind and get away with it most of the time. If they get caught then they get a slapped wrist. Maybe an action plan with more cases reviewed. Very unusual for them to lose their job over it and they dont pay the redress.

What's the salary to commission/bonus ratio of one of your people when he comes to my home to advise?

They are not on salary. They are self employed but attached. Typically though its 1% of amount invested with a minimum of £500 and a cap of £2000. The cap may be reduced depending on the type of transaction and work done. Equally the minimum is often waived where family members are involved. Thats my model. It may not be the best, it may not be the worst but before anyone does any business of any sort they know that is what they will pay regardless of product, provider, tax wrapper or whatever.

Does it concern you in any way how they managed to achieve that history of high commission earnings?

It would concern me more if they hadnt. When looking for well qualified, long experienced advisers with clean track records, you expect them to have good earnings. If they didnt then you wonder what is wrong with them.

Sorry Dunston, I don't want to paint you as a baby-strangler and not suggesting you are any worse than others in the industry

There are many things that need improving and issues that need addressing out there but at the moment it seems that you are painting me as the evil one.

MrMicawber_2

No, I'm not being abusive - go back and read the tone and lack of politeness with which you have written your posts - they are terrible. And you have the temerity to suggest that I would encourage people to borrow to invest.

Quote "to be frank I would not in any way be interested in your explanation". THAT JUST ABOUT SEEMS TO SUM YOUR POSTS UP.

I don't think I've yet seen a reply from you, where you differ in opinion, which indicates that you have properly read the post sent.

If you were in any way interested in what anyone else had to say perhaps you would read their posts and not bully people who have a different opinion.

earlgrey_3

MrMicawber wrote: »

WHAT EXACTLY ARE YOU TRYING TO SAY

Please don't shout. Go and lie down in a dark room till you feel better.

MrMicawber_2

Come on you can do better than that. Or maybe you can't. Read, debate, post an intelligent reply. Not one that twists, bends, misquotes and bullies.

jem16

earlgrey wrote: »

Jem, I didn't expect your IFA to move you to cash. How could I when I had no idea of where you were invested. Might have been entirely in gilts for all I knew.

So what does this say then?

earlgrey wrote: »

If they are commission-based did they sacrifice their trail commission by giving you the sensible advice to take profits and move into cash a year ago? Or did they keep you fully invested to maximise commission? That's the test of good advice.

Thank you but you are mistaken to equate caution with hate. Some of my best friends are IFAs as the saying goes.

Your posts go further than caution.

earlgrey_3

dunstonh wrote: »

There is no comeback for poor performance as performance is always an unknown. There is also no comeback for not having a crystal ball.

And because of that encouraging someone who is looking for low risk to invest during an extremely turbulent period is impossible to challenge as mis-selling.

On this board you specifically discouraged someone who wanted to move his UK stockmarket investment to a cash ISA when the FTSE was at over 5000 and so 35% higher than it is now. I assume that's similar to advice you would give to clients.

Q Should I cut my loses, sell the shares and put the money in my Cash ISA (which will no doubt give a better return at the moment) or shall I keep feeding money in for the long term and spread my loses?

A. Selling after a stockmarket drop only crystallises your losses. However, the monthly payments you make now are buying units much cheaper. So, if you sell up you would crytallise a loss and miss a buying opportunity.

Clearly you don't have a crystal ball but some might put greater credence on your advice than they should so shouldn't you be a little more circumspect? This was someone with just a very small amount of money - enough to put in a cash ISA.

You cant pick and choose when to invest as no-one knows when there is going to be a downturn or how big that downturn is going to be. Equally they dont know when the growth periods will be and how big it will be.

Absolutely but there were plenty out there advising caution. It's fine if people understand the limitations of an IFAs advice which I would like to see more often highlighted. People need to understand the commission earning IFAs will almost always encourage investment for obvious reason. Don't expect to go to an IFA and be told to keep the money in the bank until the outlook is better.

You can have a very nice person as a tied agent but the limitation of what they can do will always be a limitation. So, why go to the most expensive type of adviser, with a limited product range?

Absolutely. Just be aware of the potential conflicts of interest with any source of advice - especially where commission is involved.

The tied rep doesnt have to pay the money out of their own pocket. The owner, partner and directors of the small firms do.

The directors of a limited company have pay compensation rather than the company? Really, are you sure? How is their responsibilty in that respect any different from the directors of a large company?

They are not on salary. They are self employed but attached.

So if they don't persuade the prospects to invest they don't eat and pay all their own expenses? Do you feel that commission only is less likely to lead to mis-selling than a fully employed with salary plus arrangement arrangement?

Commission-only self employed salesmen are common in the double-glazing and kitchens industry but is it really suitable for a "financial adviser" and not likely to lead to problems?

There are many things that need improving and issues that need addressing out there but at the moment it seems that you are painting me as the evil one.

Certainly not evil Dunston. I'm just someone with reservations about financial advice from self employed reps working solely on commission as yours do. It's just my terribly cynical view of human nature when money is involved.