Looking for an IFA - I will pay 5% maybe 10%!

Ark_Welder

darkpool wrote: »

why do you think i gamble?

you are a UT investor, aren't you?

If you were able to perform competent research then you would be in a position to provide your own answer.

darkpool

Ark_Welder wrote: »

If you were able to perform competent research then you would be in a position to provide your own answer.

i could, but i can't be bothered.

i better get to bed, i've a busy day tomorrow blasting wildlife out the sky

Meeper

Seems you have missed my point which has been clipped on to the bottom of the previous page.

gadgetmind

Meeper wrote: »

that an adviser should be liable to pay money back to the investor when markets fall is ludicrous

Here's a scenario.

Someone comes to you with an investment idea. They want you to invest your money in their existing company with what sounds to be a sound business model, albeit with a degree of risk that needs managing. However, as you start due diligence, you find that the business hasn't been doing well over the last decade, and has had a very torrid few years lately. Even more worryingly, the arrangements with the company's suppliers appear to be far less than arms length, and there are suggestions of sizable back-handers.

OK, time to apply the acid test. You suggest a 10:1 investment match, with you putting in the lion's share in exchange for a fast exit via an A/B share split. At this point, they get all cagey and instead suggest that they don't put any money in and instead just take a cut of the balance sheet each year - not revenue, not profits, balance sheet!

What would you do, invest or walk?

I'd walk, but I'm sure the strengths of the underlying business model would stick in my mind, and I'd start looking at ways to leverage this via different investment vehicles, ones where all of those involved had skin in the game.

Meeper

Ok - so you've avoided directly responding to the huge majority of my post which was the most relevant part, choosing only to pick out one sentence and come back with an analogy of your own. Your analogy, to me, makes no sense at all. You're comparing apples and telephone boxes. Not even as close as apples and oranges. What is the point of your analogy, and would you care to make comment on the substance of my previous post at the bottom of page 3?

gadgetmind

Meeper wrote: »

only to pick out one sentence

I quoted the part of your message that was relevant to the thread, as you yourself acknowledged.

Your analogy, to me, makes no sense at all.

Which part didn't you understand? The world offers us a wide spectrum of things to invest in and I feel it's critical that people use the same stringent evaluation criteria for all investments. Obviously, there are areas where we can't be stock pickers, and where we therefore have to use collective investments, but surely it still makes sense to find vehicles that are efficiently run businesses with low fees and to avoid anything that's opaque to the point of shady?

would you care to make comment on the substance of my previous post at the bottom of page 3?

Which part or parts do you think are relevant to the root message and title of the thread?

Don't get me wrong, I think the OP was asking for the moon on a stick, but surely there is middle ground between what he was asking for and the current pig in a poke that much of the investment industry offers?

Meeper

The parts which I felt relevant were those which explained the nature of my work for the individual client concerned. The thread moved away from the original post and suggested in my posts that the only time people use (or should use) an asviser is when they are too stupid to be able to do it themselves. I attempted to illustrate that it is not always the case.

How many people, for example, have ever even heard of a discounted gift trust, let along understand its usage and application in financial planning? Whilst you could now go and find out about it having heard the name, how would you know that a DGT would be the most appropriate thing for you without an appropriately qualified adviser pointing this out in the first place? The exams that we do aren't just for show, you know! They provide information and insights into high level financial planning and whilst all of the information is available in the public domain, how do people know what to look for in the first place, and how can they be sure that's the most appropriate solution? Do they have the time and inclination to do all the research themselves even if they DID know where to look? Would they like the benefit of the consumer protection legislation that comes with a recommendation from an adviser?

You look at the adviser / diy approach in a VERY simplistic way which doesn't do justice to the work that an adviser does in making recommendations to a client. I applaud your efforts in doing it yourself. Can you guarantee that you give yourself the correct advice every time?

dunstonh

This is what many IFAs demand. Sad but true.

The FSA monitored initial amounts on all products for a few years and reported them on a 6 monthly basis. The average was 1.8%. Not 4-5%.


The said, I took 5% the other day. It was not expressed as 5% but that is what it equated to. It was a flat £500 charge for the cost of advice. It was taken via the product as that is tax efficient but not by a fund charge. It was a £10k investment with a £1000pm contribution. No initial charges applied to any fund.

UTs have bid/offer spread, OEICs have their up front charges, and while the discounters tend to make this go away, I have never met an IFA who does so. Some might, but I have never met one.

That isnt how it works for me. Not for many years. Most platforms are clean now. The only up front charge you see nowadays is the adviser charge, any residual bid/offer spread not wiped out fully and a dilution levy.

gadgetmind

Meeper wrote: »

Can you guarantee that you give yourself the correct advice every time?

No, which is why I do use accountants and IFAs, but (now!) use them with great care, and do my own research regards what they are recommending and why they are recommending it.

How many people, for example, have ever even heard of a discounted gift trust

They are discussed, often at length, in all the books on pensions and IHT planning that I've read, but I will definitely consult a retirement and IHT expert at the point I choose to retire as carve out trusts are definitely not a DIY area.

However, I'm about to start a new pension (pension input period of my current one isn't suitable for what I'm doing but is handy at times) and I'm more than likely to use Investment Trusts, "cash" and bonds held within a SIPP as I like what the S stands for. I also like not losing 4% up front, which is the figure quoted by the first IFA I spoke to! :eek:

Meeper

Ok, we're going round and round here.

Can I at least get you to admit that there are financial advisers out there who do not charge excessive fees and are fair in their charging structures? I see you and people like you on here all day saying "steer clear of IFAs and their 3/4/5/6/7% fees" - will you at least admit that there are some of us out there who do not do business in this way, and this number is increasing all the time with the RDR and new model adviser initiatives.

Well done for knowing your onions. Many people don't, and need the help of advisers. I don't mean this to be inflammatory, but people who spread opinions such as yours effectively telling people to avoid advisers is exactly how individuals get into trouble in financial products. The vast vast majority of people have neither the skills, knowledge, experience or time to carry out the functions of an adviser. Good for you that you do in many cases. But don't discourage others from using advisers in order to find appropriate solutions.