Independent Financial Advisers fees vs Novice Investor!

Janeybo

Lokolo wrote: »

No but a lot of other users, in other threads, are in the same situation. And instead of continuing reading the responses like you have, will give up and not return to MSE. Hence the "Please do not derail threads" comments to darkpool as he has a habit of doing so.



Not quite I understand your second paragraph. How was I attacking the posters for being upset about derailing? I am not quite sure why you thought that the post was me attacking you....

Not even sure why gadget even thanked you for it either!

I don't think you are attacking me, I didn't say that anyway. You are attacking posters in general for being upset by derailing.

I don't mind clarifying things for you, but I think it should be off this thread so as not to derail and bore others, I think there is a private messaging thing on this, so if you are still unsure please contact me via that.

jem16

Janeybo wrote: »

How would it be helpful? If you mean other novices, I'm not sure anyone else in my situation is on this thread?

Many people come onto MSE and read threads without ever posting. There will be many people in your exact situation who may be wondering the exact same thing as you and who might be helped by knowing what way you decided to go.

jem16

Janeybo wrote: »

You are attacking posters in general for being upset by derailing.

That's not the way I read Lokolo's post at all.

He has stated that in other threads posters have complained that their thread has been derailed and which he feels is wrong, not for the posters to complain but for the threads to be derailed by some who have their own agenda.

If you look back I also asked darkpool to keep the thread to its subject quite near the start.

saveonarola

@Janeybo

If you want to see how initial charges and annual commissions affect your investments over time, there is a very useful Fund Charges Impact Calculator here:

http://www.candidmoney.com/intro/calculators.aspx

(Look under 'Investment Calculators'.)

As jem16 said, going DIY will often mean that you pay no initial charge and get back some of the 0.5% annual trail commission that goes to your IFA. How much of the trail commission you get back depends on the precise charges for that fund on the platform or broker you use. So, for example, if you buy Aberdeen Emerging Markets through Hargreaves Lansdown (a popular discount broker, though not as popular as it used to be, but that's another story), the initial charge is fully rebated and you also get back 0.25% of the 1.89% TER (in other words, half of the 0.5% trail commission). So, you pay no initial charge and a TER of 1.64%:

http://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/a/aberdeen-emerging-markets-accumulation

Using the fund charges calculator, you can see how these charges impact over time.

Don't forget that the initial charge is a one-off on each pound invested, but the TER is taken every year from the whole amount invested. This means that small differences in TER can be as important as larger differences in the initial charge, because the effect of the TER is compounded over time (you don't only lose the money, you also lose the money that that money might have made in the future).

Edit: That last sentence could do with a little edit. What I should have said was that small differences in TER can be as important as larger differences in the initial charge, because the TER is charged on every pound invested every year. It's true that the effect of the TER is compounded over time, but this is equally true of the initial charge.

Lokolo

jem16 wrote: »

That's not the way I read Lokolo's post at all.

He has stated that in other threads posters have complained that their thread has been derailed and which he feels is wrong, not for the posters to complain but for the threads to be derailed by some who have their own agenda.

If you look back I also asked darkpool to keep the thread to its subject quite near the start.

Yep! Thought I was going crazy and said something completely different to what I did :rotfl:

jem16

saveonarola wrote: »

So, for example, if you buy Aberdeen Emerging Markets through Hargreaves Lansdown (a popular discount broker, though not as popular as it used to be, but that's another story), the initial charge is fully rebated and you also get back 0.25% of the 1.89% TER (in other words, half of the 0.5% trail commission). So, you pay no initial charge and a TER of 1.64%:

Provided you have at least £1k in the fund. No amc discount if less with HL now.

So if the OP uses the same 13 funds that she has now it may be that she would get no amc discount if all are less than £1k.

Janeybo

jem16 wrote: »

That's not the way I read Lokolo's post at all.

He has stated that in other threads posters have complained that their thread has been derailed and which he feels is wrong, not for the posters to complain but for the threads to be derailed by some who have their own agenda.

If you look back I also asked darkpool to keep the thread to its subject quite near the start.

ok, I can see what's happened, it's about language, I read it differently, I thought you meant 'outstanding' as in it's over the top/amazing etc. how many people complain, a more colloquial use of the term perhaps. I honestly thought you were contradicting yourself. I think it's easy to misunderstand things in written form, a bit like texting. Sorry for misunderstanding.

Lokolo

Janeybo wrote: »

ok, I can see what's happened, it's about language, I read it differently, I thought you meant 'outstanding' as in it's over the top/amazing etc. how many people complain, a more colloquial use of the term perhaps. I honestly thought you were contradicting yourself. I think it's easy to misunderstand things in written form, a bit like texting. Sorry for misunderstanding.

Tis fine! I was just worried you thought I was having a go at someone I wasn't meant to be

Good Luck with your investments!

saveonarola

jem16 wrote: »

Provided you have at least £1k in the fund. No amc discount if less with HL now.

So if the OP uses the same 13 funds that she has now it may be that she would get no amc discount if all are less than £1k.

There is also a monthly savings option - minimum £50 per month - as there is on most funds. Does this qualify for the discount, or do you have to have £1,000 in the fund?

Lokolo

saveonarola wrote: »

There is also a monthly savings option - minimum £50 per month - as there is on most funds. Does this qualify for the discount, or do you have to have £1,000 in the fund?

No you still need the minimum of £1k.

So for my newly started funds, they don't get discount until they reach the £1k minimum (so if I am doing £50 a month, it'll take 20 months before it starts getting back commission).