400k

dunstonh

ps2659 wrote: »

Thanks to all for the replies, I called yesterday to see my uncle as he has had a quote from the IFA, the ISAs held are split between my uncle and aunty but totalling just over 400k, I do hope someone can advise in general if you think the charges are reasonable or not.
1. To provide a review of there financial circumstances for both platform held ISAs - £450.00
2.After review should they need to rebalance that will be approx. £225.00 for each ISA they hold, they probably have 14 different ones each.
3.An ongoing charge of 0.5%per annum chargeable at 0.25% every six months, all fees quoted do not include VAT
Thank in advance.

Initial is a bit on the high side although by pricing the charge per ISA, it is at least transparent and does reflect the increased workload (it is 28 ISAs that need reviewing and each needs justification for transfer and its own set of forms - so it is a lot more work than one or two). Although I suspect they could get cheaper on that front.

The ongoing charge is standard.

IronWolf

dunstonh wrote: »

I would estimate initial charges of zero to £20,000 as the range.
ongoing advice charges would typically be between 0.5% to 1.0%.

Ideally, if its mainstream, then you should be targeting zero to £2000 as the ideal range. Zero may sound strange but many firms will take on a portfolio of that size with the ongoing servicing being the bit where they earn their money.

Consumers prefer to pay a percentage which is why percentages are most commonly used. However, the popular model is a fixed amount initially and a percentage ongoing.

IFAs have to be whole of market by definition. Any form of restriction means they cannot be called an IFA and the their terms of business will have to state the restrictions. They cannot use the term independent anywhere if they are not independent.

£20,000!? Is that a typo?

ps2659

dunstonh wrote: »

Initial is a bit on the high side although by pricing the charge per ISA, it is at least transparent and does reflect the increased workload (it is 28 ISAs that need reviewing and each needs justification for transfer and its own set of forms - so it is a lot more work than one or two). Although I suspect they could get cheaper on that front.

The ongoing charge is standard.

I am not sure but I think my uncle has 14 ISAs and aunty has 13 all on one cofund platform I think that's what he said also they are asking that if any decision is made that's in my uncles interest to transfer them to another ISA provider that will be more paperwork and more work and that would increase the fee in the region of £450.00 plus VAT.

dunstonh

£20,000!? Is that a typo?

Wish it was. Most firms I know have a decency limit but not all and some charge silly amounts. I have seen over £30k and on a pre-RDR case which wanted full commission, it was £70k.

I am not sure but I think my uncle has 14 ISAs and aunty has 13 all on one cofund platform

Cofunds would be one ISA (each)

redux

dunstonh wrote: »

Wish it was. Most firms I know have a decency limit but not all and some charge silly amounts. I have seen over £30k and on a pre-RDR case which wanted full commission, it was £70k.

blimey

I'm failing to imagine how that could add up to even a month's work.

dunstonh

redux wrote: »

blimey

I'm failing to imagine how that could add up to even a month's work.

It is one of the reasons why RDR came about. Commission meant that large amounts paid a lot more. Although post RDR, you do still see the off adviser try it on with a large amount.

bigadaj

redux wrote: »

blimey

I'm failing to imagine how that could add up to even a month's work.

Only two ways of pricing anything, it's either cost plus profit or what the market will bear. If the consumer is naive enough to pay excessive charges then many will take advantage of that.

ps2659

ps2659 wrote: »

Thanks to all for the replies, I called yesterday to see my uncle as he has had a quote from the IFA, the ISAs held are split between my uncle and aunty but totalling just over 400k, I do hope someone can advise in general if you think the charges are reasonable or not.
1. To provide a review of there financial circumstances for both platform held ISAs - £450.00
2.After review should they need to rebalance that will be approx. £225.00 for each ISA they hold, they probably have 14 different ones each.
3.An ongoing charge of 0.5%per annum chargeable at 0.25% every six months, all fees quoted do not include VAT
Thank in advance.

Whats the answer is this the norm or is this expensive.?

dunstonh

If its one ISA each then its very cheap on initial and on the norm for ongoing.