Changing advisors

Tils

Ill give an example

I have funds which have been recommended with a Financial Advisor from Company A. If I feel im not happy with the way they are managing these funds is it easy enough to change the funds so that its coming from say Company B?

At the moment the funds list in my name but it mentions Company A's name on them aswell.

or is this specific depending on how the original "contract" with the advisor was taken out?


btw if your wondering why I want to do this.. I dont feel they are very communicative with me .. i have to chase them up pretty much for everything and they dont even advise me to get a new Share ISA each year. I have spoken to another advisor (because of my pension though the company) and feel maybe he will give a better service but dont want to approach him if its not ethical to change advisors like Ive explained.

Thanks for any advice.

dunstonh

The new adviser can get you to sign an authority to send to the provider requesting that they transfer all servicing rights to the new adviser.

It is totally ethical and to be encouraged. If more did it, service from these lesser companies would improve.

Tils

ok thanks for the info

Is there usually a charge to changing this or most companies do it for free?

dunstonh

Always done free of charge. Remember changing the servicing adviser usually means that the new one gets the renewal/trail commissions from that point onwards. Whilst its not a lot on life assurance it is usually around 0.5%p.a. of the fund value on ISAs, Unit Trusts etc.

EdInvestor

Whilst its not a lot on life assurance it is usually around 0.5%p.a. of the fund value on ISAs, Unit Trusts etc.

No difference on this between the Old Model and New Model advisors then?

dunstonh

With unit trust/oeic funds, the typical commission is 3-4% plus 0.5%. A handful of companies do allow the 0.5% to be indemnified bringing it to around 5-6% intial with no trail but the major fund supermarkets dont.

If the original adviser took it on indemnity basis, then the new adviser will not get a penny trail.

So, yes there are differences but its more a case of the fund supermarkets forcing old model advisers towards the new model, albeit with 3-4% up front instead of new model 1%.