Stocks & shares ISA query

highlands10

My father of 78 has recently signed up for a 5 year stocks and shares ISA with Scottish Widows, as recommended by Halifax. The cooling off period has just passed. He was not aware there was an initial charge and an annual fee, but was advised to take it out as the return would be higher. I feel this is not good advice for someone of his age but would welcome your views. As the cooling off period has just elapsed, is there any other way out of this?

Lokolo

Why is a 5 year investment not appropriate given his age?

A 30 year investment, yeh fine, but a 5 year investment at 78 is not mis-selling. I am assuming if he is healthy enough to go into his bank and have a financial review, then he is likely to live for a good few years yet.

As to the Initial Fee and AMC, these would all be in the documents provided and he should have been told about these. You maybe able to get a mis-sell from this angle, not the age thing though.

Someone might give a more detailed response later.

dunstonh

He was not aware there was an initial charge and an annual fee

To be fair to the banks, they dont hide from this. It is pretty clear in the documentation. They may try and speed through in discussion but you would be hard pressed to say it wasnt documented.

I feel this is not good advice for someone of his age

Is he terminally ill? Is his life expectancy poor? Is he mentally restricted in some way that affects his ability to lead a normal life?

The banks do tend to rush through things in their presentation and will often say porkies but the problem is that verbal accusations (he said/she said) are hard to prove. Anybody can claim anything was said after the event (and unfortunately, some people do). Documentation is King.

He is at an age that you typically start to hold back on investing but 80 is generally viewed as the time to stop new investing unless there is a very good reason. I believe that Lloyds Banking Group have a mandatory age of 80 (even if the advice is right). So, he is 2 years under that.

If he has invested all his money in the S&S ISA (i.e. little or no savings left) then it would be bad advice. If it is just a small proportion then it will unlikely be.

You also mention a 5 year term. Most of their products are open ended. They do have some with a fixed 5 or 6 year term. The latter tend to have various protections in place.