Affordable IFA advice

gadgetmind

Linton wrote: »

Now I know, after reading these threads, that I did everything wrong.

Well, you are on moneysavingexpert.com rather than spendmoneylikewater.com so yes, maybe.

However DIY investing doesn't mean you have to be totally hands on and invest directly in listed companies, or even run those listed companies yourself. It just means that you cut out one layer of middleman, or maybe two or three, which is my general approach to life TBH.

BTW, I *did* get a Corgi (or whatever it's called now) chap to install our heating system, but I specified it all, did all the electrical work (fancy multi-zone learning control whizz bang lovely!) and am more than happy doing basic maintenance such as changing zone valves.

Maybe I'm getting it wrong but I like to think that I use my skills (which I'm constantly extending) where appropriate but pull in others where I can't (yet) tackle that task or (more often) am not legally allowed to.

However, I've got no beef with IFAs because 1) I don't have to use them, 2) many people prefer to live in ignorance regards all things financial and need hand holding, 3) the last one I met bought me lunch.

jem16

doughnutmachine wrote: »

It's not out of the bounds of possibility that one of these IFA professional bodies pay a member to post on internet forums with free advice, people then read the posts and are more likely to go to an IFA.

This really is getting ridiculous. You are spoiling a good discussion by continually provoking dunstonh. What are you trying to achieve?

Dunstonh has answered you many times that he is able to post frequently as he is the owner of his own business and posts in between work on reports, research etc. He can presumably, therefore, set his own times for work and leisure and does not have to stick to 9 to 5 as you seem to assume.

If he is being paid to promote IFAs, then who cares other than you and one other poster that I can think of? This board was the loser when he wasn't able to post recently and many on this thread that wouldn't use an IFA are agreeing with that.

Perhaps we should be questioning why you are here? You claim to be a DIY investor with a 6 figure portfolio yet you offer no helpful posts to people on here interested in using shares. Perhaps you are being paid to post by discount brokers such as HL to persuade people not to use an IFA but to go DIY?

It's either that or someone has spent 10 years of their life and spent thousands of hours posting here and never once thought to post anything on any of the non financial threads.

He has given up lots of his free time to provide free advice to many posters on here in the last 10 years. He obviously enjoys helping people in areas where he has expertise - ie financial threads. If he's not interested in how to make chicken soup or knit woolly jumpers to keep you warm whilst you turn down your thermostat, who cares?!! If he doesn't know one end of a spark plug from the other and doesn't run up parking tickets, who cares?!!

Try following his good example and help people on this forum when they ask for advice on investing in shares or they have some engineering problem they want fixing. Or is your 6 figure portfolio and engineer profile ( from previous lives on here) just figments of your imagination?

Please give it a rest and let the rest of us enjoy a good discussion!

dunstonh

Freecall wrote: »

As a complete side issue, is this the case?

I had always assumed that most would be employed by the big firms but maybe that is only because the only dealings I have ever had has been with the huge players.

Someone will have a link to the breakdown I'm sure.

Most IFAs are small local firms with 1-5 advisers. However, there are indications that it may be starting to follow accountants and solicitors in consolidation into larger firms.

gadgetmind

jem16 wrote: »

He has given up lots of his free time to provide free advice to many posters on here in the last 10 years. He obviously enjoys helping people in areas where he has expertise - ie financial threads.

Yes, yes, and thrice yes. And I *very* rarely go anywhere on MSE than here and the pensions forum.

Please give it a rest and let the rest of us enjoy a good discussion!

Well, if anyone stops having fun, they can just unsubscribe from the thread.

Alenna

grizzly1911 wrote: »

In a relatively small and simple investment case as posted by the OP (ex pension issues which I acknowledge may be a stumbling block) should the initial "free advice automatically move into advice to roll up the existing cash savings and Cash ISA into 100% S&S ISA (which are likely to be low risk/reward for the OP).

Moving to 100% S&S ISA, and leaving no cash reserves, doesn't seem a logical recommendation other than in some way justifying the fees to be charged - i.e. seen to be doing something.

This thread seems to have taken on a life of it's own... boilers seem to be a hot metaphor.
@N1AK - thanks for remembering my OP! The IFA recommends keeping around £12K in cash. Personally I find this a bit low for my cautious brain. I am struggling to find out how cost effective it would be to go with the IFA vs DIY. Mainly I'm worried that there'll be a lot of hidden costs that I dont know about till too late in either option. Also that I may make a mess of investing. I'm trying to get to grips with DIY platforms but it's really new territory. Cavendish seem to say they can tranfser pensions too, though I don't know how that works if they don't provide advice and Aegon insist my pensions must be dealt with by an IFA.

jem16

Alenna wrote: »

The IFA recommends keeping around £12K in cash. Personally I find this a bit low for my cautious brain.

Have you told the IFA this? The one thing that's important when using an IFA is communication. If you're not happy then talk about it. If you want a higher cash buffer then say so.

Mainly I'm worried that there'll be a lot of hidden costs that I dont know about till too late in either option.

Hidden costs shouldn't be an issue with any IFA since RDR in January 2013. Even before that it was a requirement to give full disclosure on costs to the IFA but now it is even more transparent with costs having to be listed for fund management, platform fee and IFA fee.

The DIY platforms haven't quite caught up with this as they are at least a year behind. However you should find plenty of info on here with various threads looking at platforms. Just ask further questions.

Also that I may make a mess of investing. I'm trying to get to grips with DIY platforms but it's really new territory.

There is always that problem. Only you can make that judgement but perhaps you should start off with the IFA until you feel more comfortable and learn along the way?

Cavendish seem to say they can tranfser pensions too, though I don't know how that works if they don't provide advice and Aegon insist my pensions must be dealt with by an IFA.

Cavendish are IFAs but they also provide a discount DIY brokerage so it should be ok. However they will not give you advice on which of their products is most suitable. You must make that decision yourself, with or without help from here.

jem16

gadgetmind wrote: »

Well, if anyone stops having fun, they can just unsubscribe from the thread.

No I'm still having fun. I just feel that the OP is being distracted from the true purpose of this thread which is a shame.

jimjames

doughnutmachine wrote: »

It's not out of the bounds of possibility that one of these IFA professional bodies pay a member to post on internet forums with free advice, people then read the posts and are more likely to go to an IFA.

I'll say it again - so what? Unless there is a bias in what is being said - and I've never read any - then what does it matter even IF (a very big if) he was being paid.

doughnutmachine wrote: »

It's either that or someone has spent 10 years of their life and spent thousands of hours posting here and never once thought to post anything on any of the non financial threads.

I'm hoping your obsession hasn't got as far as checking every one of the 70,000 posts for subject matter - but otherwise how would you know?

I post almost exclusively on this board because it is where my main interest and experience lies. Does that mean you think I'm paid too? (for the record I'm not either)

grizzly1911

Alenna wrote: »

This thread seems to have taken on a life of it's own... boilers seem to be a hot metaphor.
@N1AK - thanks for remembering my OP! The IFA recommends keeping around £12K in cash. Personally I find this a bit low for my cautious brain. I am struggling to find out how cost effective it would be to go with the IFA vs DIY. Mainly I'm worried that there'll be a lot of hidden costs that I dont know about till too late in either option. Also that I may make a mess of investing. I'm trying to get to grips with DIY platforms but it's really new territory. Cavendish seem to say they can tranfser pensions too, though I don't know how that works if they don't provide advice and Aegon insist my pensions must be dealt with by an IFA.

In the OP you mentioned a small pot of £30k. In another you mention £17k cash & 24k cash ISA. Here you mention £12k being retained in cash, but this may not be enough. Is this £12k separate or part of the £17k?

bowlhead99

doughnutmachine wrote: »

Lol! The comment below is from the BBC. It is fairly well known that companies employ people to post on internet forums. It's the people that deny this could happen on MSE that should be wearing the tinfoil hats.

"Trust in information on the web is being damaged by the huge numbers of people paid by companies to post comments online, say researchers."

http://www.bbc.co.uk/news/technology-15869683

Without a doubt, companies, industry bodies and other special interest groups pay people to interact with social media to further their interests. However, when you were banging on about it dragging out another multi-page thread on this topic four months ago, my observation, and that of others, was that the 'free samples' provided by IFAs on this and the pensions board were generally useful.

Typically their comments are level-headed and they provide competent suggestions, often pointing people towards sensible conclusions that they might not have reached on their own. It might be an advert for the industry at large, and if it is it might be an unpaid ad to voluntarily raise interest or it might be a sponsored ad to raise interest. Some of the posts from IFAs are likely from people whose whole work life is investments and favourite hobby is investments and talking about investments in their spare time (and 'work' time, being self employed and flexible) is just something they do.

Either way, whatever the motivation for posting, the addition of on-topic posts to an investment forum is less intrusive than a banner ad, while something that raises the quantity of informative posts is generally A Good Thing for an investment forum. The existence of the posts have not blocked my ability to have a reasoned debate with other non-IFAs here, and they have not caused me to blindly go and spend hundreds or thousands on IFA services which I think I can get by without do without. So, I am literally gettng something for nothing and it is a win-win.

I haven't bought any IFA services but I am aware of what they do, and don't doubt I could find a competent one if I looked for one. Perhaps if there had never been any free samples I would have thought otherwise. So in that respect the 'advert', whether or not it is truly an ad, has worked.

But the key is, I don't care if it is an advert and neither should you. Being an intelligent human being who has been using the internet for twenty years, I am able to mentally filter what I read and treat EVERYTHING with a dose of professional scepticism, thereby I am unlikely to be damaged by something I read. Whether something innocent-looking is a veiled promo for having a regulated industry professional advise me on my wealth, or a promo for me putting my life savings in a bitcoin-backed ponzi scheme, I am reading it with my eyes open and I am going to try not to get suckered into anything. I will read other posters on the boards and not blindly trust that I should go and buy IFA consultancy just because an IFA with a good idea was able to articulate that good idea on a forum.

If other less intelligent, uneducated people, who do not have much of a passion for learning and self-improvement, are reading internet posts and taking them as gospel without thinking them through properly, then perhaps they deserve to be duped. But being 'duped' into buying regulated professional advice on what to do with your life savings is far from the worst fate that could beset an unintelligent uneducated buffoon.

People providing competent consultancy or other personal services are, for many, worth paying. We all recognise there are bound to be bad ones like there are in the fields of law, accounting, plumbing, roofing, teaching, whatever. The beauty is, if you don't need the service, or the person does not seem competent, you don't have to buy it. The IFA service even has liability and a regulated complaints mechanism for customer protection. So, I don't care whether someone in the IFA field or law field charges £20 an hour or £200 or £2000 an hour.

My own skills (not IFA) are charged to clients at a lot more than what I take home in salary because there's a whole corporate infrastructure and cost base, and profit margin feeding into the fee, so I recognise this elsewhere when I'm buying services and don't expect to get good ones at salary cost.

Also, beyond my firm's own cost base, my clients are willing to pay the going rate because for the price they pay they get my knowledge and experience of 15+ years in my industry rather than having to sit through 15 years themselves in order to answer the questions. Clearly it is less black and white than that but they recognise that buying some equivalent of 'Smarter Investing' for a tenner does not give them the same rounded perspective as employing a firm of professionals who have read that book amongst many. It doesn't give them a guaranteed better result than reading the book or than picking a rival firm or employing their own guy dedicated to their project. But its a choice and some will think it's the right one.

For each potential customer there will be a point at which the service is worth it and not worth it. Much like paying an estate agent £8,000 for trying to get £800,000 for the house you're selling instead of £750,000; or for only getting the £750,000 you could have got from the online agency but without you having to take 25 afternoons off work or off holiday to conduct the viewings. To some a service can be worth it even if it appears expensive to others. It doesn't mean the service should be outlawed and those in favour of it, hunted down, ridiculed and shot.
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To the OP - thanks for letting me join in the ranting and venting that's turned into 100+ posts on your thread! You have 30k lump sum, plus unknown other savings perhaps totalling the 17k+24k =41k plus some other shares on the side. If the IFA was turning this all into an S&S ISA over time is there another 12k somewhere he can keep as cash or would this investment wipe out your cash?

Also I'm not sure if I missed somewhere you telling us what your income was like now you've retired? Do you need to draw from the proposed 40k invested pot to live on over the next few years? If not, what do you live on now after retiring early through ill health? Or is it the opposite and you can afford to live, plus add to it over time from some other income source or a partner's funds etc.?

You won't get a perfect solution on a forum but perhaps if the investments are going to be added to over time, this would change the potential cost structure ; likewise if you are spending it in the short-medium term you might not favour an expensive advised/ managed solution because in some circumstances cash could do nearly as well as a low risk capital-preservation investment after advice costs.