Advice on IFA charging fee

feisty1

[quote=dunstonh;16899715]The OP said the adviser has set up his own company so I take to mean he has split with the original employer. As for poaching clients, only the OP can tell us if they see the adviser as their adviser or the original firm as their adviser. If its the original firm, then he is poaching. If its him, then he is just making sure the original firm no longer hold the authority to contact the OP and that he does.[/quote]

Quote: When we bought our house some years ago a friend of ours offered to help with the financial products as he's an IFA.Quote:

Joe_Bloggs

I would like to thank dunstonh's cool and impartial approach to dealing with my perceptions as a 'layperson' . This is in no way a criticism of feisy1 either.
Do not let friendship determine your financial decisions. Only use cold calculating logic when making financial decisions.
J_B.

feisty1

Joe_Bloggs wrote: »

I would like to thank dunstonh's cool and impartial approach to dealing with my perceptions as a 'layperson' . This is in no way a criticism of feisy1 either.
Do not let friendship determine your financial decisions. Only use cold calculating logic when making financial decisions.
J_B.

Let's wait and see dunstonh's reply, as i'm feel he may wish to read again & see this OP has clearly stated it was a friend.

silvercar

feisty1 wrote: »

Their is nothing complex abot being told "and my fee for arranging yr mortgage will be £xxx.xx People understand when any other person quotes them for work.

Maybe I have missed a point, ah!could it be we are expected to work for free?

grogdog wrote:

damn i thought we were a charity and worked on a voluntary basis!! , can we actually earn money for advice and arranging mortgages that means people dont have the hassle of taking time of work to talk to individual complanies? i knew i was doing something wrong.

Many, many advisors earn their income from the commission paid by the lenders.

An advisor, particularly one who is a friend, should be up front and tell the client if he earns through commission or by charging a fee.

Joe_Bloggs

Only the original poster can say if they understood the subtle nuances of what was suggested in the original letter.
I said take it to CAB. Where was I wrong ? What harm could it do ?
J_B.

feisty1

silvercar wrote: »

Many, many advisors earn their income from the commission paid by the lenders. An advisor, particularly one who is a friend, should be up front and tell the client if he earns through commission or by charging a fee.

Silvercar: Pls take the time to read, if you do, you will find I replied first to the OP somewhere along the same lines as yourself

silvercar

feisty1 wrote: »

Silvercar: Pls take the time to read, if you do, you will find I replied first to the OP somewhere along the same lines as yourself

Sorry I can't see anywhere where you have said that advisors can and do rely on commission.

feisty1

Silvercar: I was referring to yr "selective" editing, where the quote posted was referring to us working for free when in actual fact in my first reply I said to the OP that friend or no friend, they should be made aware of what is being charged and you wrote "An advisor, particularly one who is a friend, should be up front and tell the client if he earns through commission or by charging a fee" The essence is the same... "transparency"
I am not going to post "advisors can and do rely on commission", simply because this varies.
However, when it comes to integrity, I do agree with you.
I have to add, it "amuses" me somewhat, when some people get so "hung up" on what we do or are supposed to earn. I offer my clients a service and they can choose whether they want to deal with me or not. I do charge fees, I do receive commission sometimes both and other times it varies, depends on the complexity of the work. What is the problem with this, do you work for free? My clients know my fone is on from 8am-10pm, I visit them at home 90% of the time and most of my visits are done in the evening. I have a para planner who receives a salary, I have all my operating costs to cover just like any other business.
The credit crunch has affected many advisors in this industry however I am pleased to report I have survived simply because I am customer driven and not commission driven. This is reflected in the referral business I receive from existing clients and they strangely enough don't object to how I am paid

silvercar

When I first contacted my IFA, recommended by a friend, he had 2 initial comments to make before we met up:

1. That all dealings are confidential (important as we have a lot of mutual friends),

2. That he works on a commission basis.

I would expect that anyone using a friend as an advisor should be told at the outset the basis on which the advisor earns his crust.

Its almost more important when dealing with friends as (a) there could be more embarrassment for the client in having to ask the question and (b) there is often a blurring (and possible misunderstanding) between what is given as a friendship and what is someone doing a job.

feisty1

Silvercar: I am agreeing with you completely on the subject of transparency! It goes without saying that dealings will be confidential regardless of the relationship but that works both ways also.