Inherited Investment Portfolio

amyparr

Hi,

My partner and his mother have inherited an investment portfolio from his late father, currently worth approx £200,000 (has lost £25k this year).

His mother has suggested using an investment management company recommended by her friend and financial advisor (not really sure what his credentials are) which charges a 1% fee of the value of the portfolio (i.e. £2,000 per year).

Does this sound reasonable? If he doesn't want to go with this company, what other options does he have to manage this portfolio?

lawrie28

Most of the £2k per year will be comission to the IFA. Alas this is the world we live in. Who managed the portfolio previously?

WHat do they want to use the money for? Are they looking to this for a source of income, of can they take a risk? As you know, it has lost a large amount of money - selling up and putting cash in the bank may be a safer option, and without a £2k annual fee!

I am sure someone with more of an idea will be along soon to give you a better idea.

EdInvestor

The answer will largely depend on what the money is currently invested in, and whether the beneficiaries intend to keep the same investments.Different companies handle different things.For example if the portfolio includes shares, a stockbroker will usualy be needed, whereas if it's mainly in unit trusts, an IFA may be a better choice..If you want to manage the investments yourselves, there are other low cost DIY options.

Suggest you have a look at the paperwork to see how the father was running the portfolio as a starting point.

A loss of £25k on a portfolio of £200k over the past year of crashing markets is not a serious one, but without knowing how it is invested, and the attitudes of the the new owners, one can't say whether anything should be changed.

amyparr

As far as I know, his father managed his investments himself, and did so with a long-term view, not really buying/selling a lot. He was invested across a broad spectrum of products, funds, equities etc.

I also imagine that they will be looking for long-term growth.

Biggles

EdInvestor wrote: »

A loss of £25k on a portfolio of £200k over the past year of crashing markets is not a serious one, but without knowing how it is invested, and the attitudes of the the new owners, one can't say whether anything should be changed.

I would have thought it was quite serious to lose 12½% this year. It hasn't actually been a 'year of crashing markets'; depending on which date you take as the starting point, markets have risen considerably - the 'crashing' all took place the previous year.

But I agree that no one can say anything without knowing what it has been invested in.