Have you heard of St James's Place

dunstonh

An IFA is more likely to fail by relying on full upfront commission than utilising trails. In a quiet period or if business dries up, with full upfront commissions there is no income to follow.

I invested just over £850,000 this week. That earned me £8,500 upfront plus £4250 a year in trail. The clients got rebates of around £34,000 in total so they are all happy. Had I gone full upfront, I would have been paid £63,750 commission. Very nice but very greedy and did the workload really justify £63,750 for 7 days work?

EdInvestor

dunstonh wrote:

I invested just over £850,000 this week.... Had I gone full upfront, I would have been paid £63,750 commission.

Hmmm 7.5%, must be those investment bonds again....;):rolleyes:

masonic

Tiggs wrote:

I didnt, i infered that the MSE mindset is such that a company failing but being a bargain is preferable to one prospering from choices that are not directly related to clients saving money.

http://skepdic.com/falsedilemma.html

Tiggs_2

i dont hide the fact that i sell fo a living, ANY adviser not working on FEES ONLY is selling for income. You can argue 7%, 1%, NMA, trail, etc.....it all equals investment provided = income earnt.

that is the industry i joined many years ago....financial sales. I did not go to law school or get an accountancy degree.......i learnt how to sell then found a product and a market that i did well in and enjoyed. As years have passed i have realised that, nowadays, an easy way to "sell" is to focus on speacalist advice presented without pressure. This is wonderfull for two reasons.....it lets me (as a salesman) make a good living AND ensures my clients get good advice from someone that has (as a means to earn money) become very skilled in his field.

I dont charge many fees for two main reasons......

1) the "public" dont want to pay fees. end of. The "industry" watchdogs may want them to, but they dont. If i had a stream of people opting for my fee option i would consider doing away with the commision option.....but i hardly EVER get anyone wanting to hand over a fee for advice.

2) i would make less money....and i do this job to earn money. It is high stress, long hours, few holidays and not very interesting (i wanted to be a pilot!) If it paid me "normal" money i would go do a "normal" job........i make no bones about it, i'm here for my business to make me wealthy - i take great pleasure knowing that i will achive that while helping many people.

dunstonh

Hmmm 7.5%, must be those investment bonds again....;):rolleyes:

Not of all it was but there was some. Needed the life element for IHT planning. However, it is possible for advisers to indemnify ISAs and OEIC commission if with some providers bringing the commission in line with bonds.

Tiggs_2

dunstonh wrote:

An IFA is more likely to fail by relying on full upfront commission than utilising trails. In a quiet period or if business dries up, with full upfront commissions there is no income to follow.

agree 100%, after 10 years of not taking much trail i have realised that the rollercoster of income is not ideal (although fun at times ) In the past reasons for my not going to SJP is that its very trail based.....in fact one of the main reasons for going is to build up a sellable practice which needs lots of happy clients generating fees on funds under management.

Tiggs_2

masonic wrote:

http://skepdic.com/falsedilemma.html

read the first paragraph and got bored i'm affraid......i'm sure its a great read for those interested!

masonic

Tiggs wrote:

read the first paragraph and got bored i'm affraid......i'm sure its a great read for those interested!

That's ok. It wasn't really posted for your benefit.

Tiggs_2

"But they usually aren't, because they would earn a lot less working for a fee than working as distributors of financial service industry products on commission."

i think this sums up the issue......it is quite possible to work as the distributors of financial service industry products and still be someone dedicated to providing good advice to clients.

I have sold "industry products" for 10 years and (touch wood) never had a single complaint and never had a single client take their business to a different adviser. Either i am very lucky or its an example that the right approach and the right ethics can allow "product sales" to be a perfectly acceptable business for business owner and client.

Poppy9

Glad I perchanced across this thread.

In January my IFA who I've dealt with for years advised me to switch my ISA from Skandia to SJP. I pay in £100 per month and from 26.1.06 to 30.06.06 I have invested £6900. I recently had a statement telling me my current investment stands at £6700.

I spoke to my IFA as I'm not happy as this money is to pay off my potential shortfall in Endowment mortgage. He told me not to panic that the Stock Exchange had lost 20% in the last 6 months, I was buying cheap etc and it was recovering. I'm not convinced though. For the last 5 years Skandia hasn't failed to show me a better return than BS.

Due to my holiday commitments I get together with him till September but I think I'm going to withdraw from SJP. Are there any pitfall in this?