Nationwide Investment Charges

dunstonh

Nationwide versions of the fund are more expensive versions than the IFA version. The Nationwide versions of L&G funds have (N) in the fund name.

Now that is sounding a little desperate.

I understood it to read that if you are going to use a tied agent then use an IFA instead for your own sake.

jimjames

dealsearcher wrote: »

Has anyone used this service? It appears to be a pretty good service looking at your full financial and risk profile and determining the best funds for you from a wide selection.

However the 'initial advice' charge is a bit confusing. It seems simple enough as they charge 3% of the amount you invest. But then you can top up your fund directly without a 3% charge on the top up amount. Therefore it would appear you can invest a minimal amount, which is subject to the 3% fee, and then top up the fund to a much larger amount with no further 3% charge.

Has anyone tried this with this service?

If you are paying a fee for advice why would you not go to someone who can offer you unrestricted advice rather than one that can only sell their own tied products. If L&G don't have a good Emerging Markets fund for example then you would have to have whatever they sell. With an IFA you have the choice of any across the whole market.

If you are thinking about effectively doing DIY portfolio then you could just go straight to somewhere like HL and choose your own funds straight off without any initial charges.

www.hl.co.uk

Not the cheapest but a very easy to use website and trading platform (unless you are buying RM shares:)).

dealsearcher

bowlhead99 wrote: »

Fine, so it's not a 0.3% trail commission or annual review fee, it's a 0.5% annual review fee. The fact remains there's no point taking their advice on how to invest £5000 and then splitting your £500,000 in those proportions and waiting a year for the review to come up, where they tell you at lower cost how to rebalance it to something more appropriate for that amount of money and your genuine goals, risk profile and expectations.

The disparity in returns between different asset classes might be 20% over the year, so unless you are going to competently DIY during that time (in which case you don't need to pay advice fees in the first place), you should probably not try to beat the system to get something for nothing.

Instead engage an IFA who has access to all investments on a wider choice of platforms for whatever the market rate is for that service. Or defer your investments and take time to learn to DIY. Opting instead for the halfway house of paying IFA-type fees but being locked in to whatever the L&G /Nationwide products and prices are - and bearing in mind that they don't offer all funds or necessarily the cheapest versions of the funds that they do offer - seems a funny way of going about it.

I agree with your final paragraph. However your first two paragraphs make assumptions about the Nationwide scheme when you are not familiar with it.

The annual review fee of 0.5% allows for multiple interviews with an advisor and not just after a year. An interview could be arranged after less than a month with modifications to a portfolio at that time.

Of course when you have spent 3 hours with an advisor on an initial free interview there are a number of things which need further clarification. Hence my question on this forum.

bowlhead99

You're right, I'm not familiar with it. So, I can't tell you whether or not you can make a good saving by telling them you have a small amount of money on which you want to pay an initial fee, and going back a month later with different goals and new-found wealth to get your portfolio completely re-calibrated, without the extra wodge of cash attracting a new "initial fee".

Given the advice here about the perils of paying top tier prices for tied sales advice, you might find the absolute best value is to walk away, having already had three hours of discussion about your goals, aspirations,and the type of risks you can handle or the type of returns typically available from different investment classes, for absolutely nothing.

If you haven't really covered any of that stuff in the three hours or got any ideas from it, I'd be intrigued to know what they did cover. But if you have, it probably gives you a great grounding to go and discuss it again much more efficiently with an independent.