Do I invest?

bendix

dunstonh wrote: »

In reality, if you are using the money for income then there is no risk free option. Cash savings have a risk and investments have a risk.

Why bother using an IFA at all in this instance. If she's investing for income, choose a variety of income funds from HL and take out the middle man.

Why on earth pay an IFA a few thousand quid for doing something a couple of days of self-education will give you?

Madness. Sheer madness.

dunstonh

Why bother using an IFA at all in this instance. If she's investing for income, choose a variety of income funds from HL and take out the middle man.

Why pay HL for doing it then as they currently keep half the normal adviser take? You are not cutting out the middle man. You are replacing them with another middle who gives no advice, less consumer protection and takes a bit less (potentially - as its not always the case that cost is different).

Why on earth pay an IFA a few thousand quid for doing something a couple of days of self-education will give you?

If you know what you are doing then fine but if you DIY and make a pigs ear of it then it can cost you a heck of a lot more.

If someone wants to spend 100 hours or so learning the basics then its up to them. However, not everyone does.

jamesd

bendix, as dunstonh wrote, HL keeps the 0.5% trail commission that would pay an IFA for the work. The IFA can either do the work or they can look to negotiate a discount with the IFA. Either way that would probably produce a better result than HL. Though not with the charge contemplated by the IFA in the initial post.

Rollinghome

dunstonh wrote: »

If you know what you are doing then fine but if you DIY and make a pigs ear of it then it can cost you a heck of a lot more.

The fact is that any investor needs to understand at least the basics before going near any commission-hungry IFA. Having paid for advice, they shouldn't assume that an IFA will invariably sell them investments primarily chosen to benefit the client rather than the adviser. As the clients who were sold Arch Cru investments recently found out: http://www.ifaonline.co.uk/ifaonline/news/1601736/angry-arch-cru-investors-police

Which is why the FSA requires extensive reforms and better training for IFAs by 2013 to end mis-selling.

dunstonh

Which is why the FSA requires extensive reforms and better training for IFAs by 2013 to end mis-selling.

IFAs account for under 2% of complaints at the FOS despite handling the majority of transactions. Tied agents account for over 50%. Tied agents are having to take the same qualifications as IFAs.

Your anti IFA bias stands out when you are critical of the most compliant and well regarded distribution channel but never criticise the one that really needs sorting out; the tied agent.

Having paid for advice, they shouldn't assume that an IFA will invariably sell them investments primarily chosen to benefit the client rather than the adviser.

If you are paying for advice how does the choice of investments benefit the IFA?

As the clients who were sold Arch Cru investments recently found out: http://www.ifaonline.co.uk/ifaonline...vestors-police

Out of 30,000 IFAs, less than 1000 recommended this fund. The DIY investors also went into this fund including a number of posters on this board as well as other DIY investing forums.

purch

What is my best option?

Bottom line is, whatever you choose 'someone' will be taking a slice of the action.

Shop around, get as many different 'quotes' (advice) as possible, and get some value for what you ultimately have no choice in paying for.

Jake'sGran

purch wrote: »

Bottom line is, whatever you choose 'someone' will be taking a slice of the action.

Shop around, get as many different 'quotes' (advice) as possible, and get some value for what you ultimately have no choice in paying for.

I realised the truth of this a long time ago but I wanted to invest in the stock market and keep a decent sum in fixed rate savings accounts. The funds I chose have done well; very well in a few cases but, I have made mistakes for which I console myself by looking at the gains on the others. When £3000 invested in a BG single company PEP
becomes £17K it must beat a savings account even over 15-20 years.