Questions to ask an IFA?

Daniel_Elkington

Do you mean not (outsourcing) to someone... your grammar usage doesn't make sense to me. Why would you want to see wood when you see a beautiful forest, why on earth would you want to see practicality in everything you see, what a cold world that would be.

This is very relevant to a professional relationship, it is a relationship between an adviser and their client, which is a beautiful thing. One where the adviser trusts the client to be open and honest and where the client trusts the adviser to work in their best interest. I love my job as I get to meet people and make friends. My clients are all people I would quite happily have a few drinks with on a friday evening. I don't work with people I don't like, never going to be a millionaire that way, but life isn't about getting rich, it's about enjoying your work and your family.

But I'm only 27, lots of time for the cynicism which comes with age to kick in, every day is still a bright new future for me. However there was that QI that said a grumpy old person was probably a grumpy young person.

Well, you can thank the data protection act for that, and years of spam. People don't want to publish their data. I have a couple of testimonials on my website and want more but people don't seem to spend that much time online!

1echidna

Daniel_Elkington wrote: »

Do you mean not (outsourcing) to someone... your grammar usage doesn't make sense to me. Why would you want to see wood when you see a beautiful forest, why on earth would you want to see practicality in everything you see, what a cold world that would be.

This is very relevant to a professional relationship, it is a relationship between an adviser and their client, which is a beautiful thing. One where the adviser trusts the client to be open and honest and where the client trusts the adviser to work in their best interest. I love my job as I get to meet people and make friends. My clients are all people I would quite happily have a few drinks with on a friday evening. I don't work with people I don't like, never going to be a millionaire that way, but life isn't about getting rich, it's about enjoying your work and your family.

But I'm only 27, lots of time for the cynicism which comes with age to kick in, every day is still a bright new future for me. However there was that QI that said a grumpy old person was probably a grumpy young person.

Well, you can thank the data protection act for that, and years of spam. People don't want to publish their data. I have a couple of testimonials on my website and want more but people don't seem to spend that much time online!

Good at gobbledegook aren't we? Do your nice friendly customers feel happy at the moment?

doubleJackD

srcandas wrote: »

What I expect from an IFA is that he/she can identify all the options open to me, describe to me the costs and arguments for assessing risks, and to be able to action the processes to make my chosen options happen with a high degree of accuracy and timeliness.

but it appears that IFAs only suggest investing in a few specific areas like UTs and Investment Bonds. They rarely, if ever, advise a client to buy shares or property.

So, I would suggest an IFA will not identify all possible investment options.

dunstonh

but it appears that IFAs only suggest investing in a few specific areas like UTs and Investment Bonds.

Pretty obviously given the pre 2013 remit.

They rarely, if ever, advise a client to buy shares or property.

No consumer protection with those and both require a level of knowledge and understanding as well as work that a typical consumer does not have.

So, I would suggest an IFA will not identify all possible investment options.

You need to be realistic and consider the average UK consumer. An IFA will consider more advanced options for a more advanced investor. However, it would be an upheld complaint waiting to happen if you used more advanced options or illiquid options with an inexperienced investor.

doubleJackD

dunstonh wrote: »

Pretty obviously given the pre 2013 remit.

Good to know that we both agree that the IFA industry do only advise on a fairly small portion of possible investment options.

I would suggest that a lot of "typical consumers" do manage to buy their own homes etc. I think you underestimate the intelligence of the Great British public if you doubt their ability to buy a flat to let out.

dunstonh

Good to know that we both agree that the IFA industry do only advise on a fairly small portion of possible investment options.

Depends on your definition of small. Over 50,000 options is not small in most people's minds.

I would suggest that a lot of "typical consumers" do manage to buy their own homes etc.

And you think that makes them suitable for being a professional landlord?

I think you underestimate the intelligence of the Great British public if you doubt their ability to buy a flat to let out.

I think you overestimate the willingness of the average consumer to do such a thing and the fact that mortgaged buy to lets are considered higher risk and the FOS and FSA both state that the average consumer is cautious. The FOS in general would consider complaints on the basis that the person is likely to be cautious unless proven otherwise.

doubleJackD

dunstonh wrote: »

Depends on your definition of small. Over 50,000 options is not small in most people's minds.

And you think that makes them suitable for being a professional landlord?


I think you overestimate the willingness of the average consumer to do such a thing and the fact that mortgaged buy to lets are considered higher risk and the FOS and FSA both state that the average consumer is cautious. The FOS in general would consider complaints on the basis that the person is likely to be cautious unless proven otherwise.

an IFA might have 50,000 investment options open to him. however if they don't offer advice on investment trusts/ property etc they can't really say they offer all the options open to a private investor.

it strikes me that an IFA is like a supermarket with 50,000 lines of produce in - however they don't sell milk or bread. I ask you if you would go to such a supermarket?

I agree that buy to let is not suitable for all investors, but to suggest that BTL is beyond the comprehension/ ability of all investors is clearly absurd.

Lokolo

doubleJackD wrote: »

an IFA might have 50,000 investment options open to him. however if they don't offer advice on investment trusts/ property etc they can't really say they offer all the options open to a private investor.

it strikes me that an IFA is like a supermarket with 50,000 lines of produce in - however they don't sell milk or bread. I ask you if you would go to such a supermarket?

I agree that buy to let is not suitable for all investors, but to suggest that BTL is beyond the comprehension/ ability of all investors is clearly absurd.

Dunston didn't said that BTL is beyond all investors, just beyond the average investor. Big difference.

IFAs can only recommend and talk about what they are allowed to. Would you ask a plumber to fix your car? By all means, if you think IFAs should be allowed to advise on shares and property, take it up with the FSA.

srcandas

Lokolo wrote: »

Would you ask a plumber to fix your car?

That is not a fair comparison. A plumber recognises when a car mechanic is required. A car mechanic recognises when a plumber is required.

An IFA needs to recognise the options - at a high level - and not be scared to suggest other avenues need to be pursued that are outside their field of expertise or outside industry allowable scope. Some probably do.

Sadly if you are not 'the target IFA audience' then it is very hard to get independent advice. Even if you want to pay fot it.

doubleJackD

Lokolo wrote: »

IFAs can only recommend and talk about what they are allowed to. Would you ask a plumber to fix your car? By all means, if you think IFAs should be allowed to advise on shares and property, take it up with the FSA.

yes, i obviously agree that IFAs can only advise on what they are regulated to advise upon. But it does seem debatable if they can call their advice independent if they can only sell certain products.

I suppose if they labelled themselves Biased Financial Advisers they would get let footfall through their front door.

It just seems to me that there is a market for financial advice from a truly independent source ie the type of advice an intelligent/ rich uncle would provide.

Thanks awfully for your suggestion of contacting the FSA, I might just do that.