Financial Advice from Third Party

tubsolard

Hi,


I received a call from a company who advised that they have customer within the organisation I work for and they invited me in for a consultation.


It's something I've actually been looking at doing anyway as I have about £30k of pension scheme from previous employment that I don't know what to do with.


They are FCA approved and I have checked that they are on the FCA register.


One of my pension schemes was sitting at £20,000 at the end of last year and is now just over £18,000 so it has decreased in value by just under £2,000 in less than a year.


I really don't have the time at the moment or the knowledge to know what to do with these schemes and they are offering to basically carry out the research and advise where to invest this fund to get the most out of it.


Does anyone else pay for this kind of advice and would anyone advise against or for it?


My thought is that - for say £500 fee to reinvest my pensions it's worth it to find the right schemes to invest in bearing in mind that clearly my largest fund is not in a profitable scheme.


Only thing is that I don't want to be paying fees every few years to reinvest as this will eat into my pot. If I do it once, perhaps I can keep a closer eye on my investments in future?


Any advice appreciated.


Thanks,


Scott

AlanP_2

See https://forums.moneysavingexpert.com/discussion/5328772 and similar threads.

The company may be different but the warnings are the same - Above board companies do not cold call re pensions.

If you provide more information on your current pensions and current age & circumstances then you will get suggestions and guidance on what to consider as options moving forward.

If you want professional advice the https://www.unbiased.co.uk website can help you to find a local INDEPENDENT financial advisor to work with, ideally meet 2 or 3 for their free introductory meetings to see who you fell comfortable with and to understand their fees.

As for the £2k drop in the value of your pot, you are not alone as markets have been falling for a good few weeks now, up to 3-4% a day on occasions. You only make a LOSS when you sell and take the cash out the market. If you can leave it in there (how close are you to retiring?) then you have time for that "loss" to be recovered and for it to grow again.

tubsolard

I read this in another thread (reputable companies do not cold call) so I am wary however wouldn't a new-ish company rely on this method to obtain business?


I'm 34, so plenty of time to recover the losses to date, no real rush to be honest. I just want to know what to do with my accumulated pensions to date.


Thanks for the advice, I'll compare a few and see what the general advice is and what the rates are, certainly makes sense.


Scott

tubsolard

Second thoughts, having read the link you attach, I've emailed them back advising that I will take this no further.


I don't like paying for a service that I can get for free so I'll follow up on your advice and the advice of the other thread.


Thanks,


Scott

dunstonh

I don't like paying for a service that I can get for free

Where are you getting advice for free?

Malthusian

One of my pension schemes was sitting at £20,000 at the end of last year and is now just over £18,000 so it has decreased in value by just under £2,000 in less than a year.

It was probably worth about £13,000 five years ago. (Assuming you've had it that long and nothing was paid in.) That seems pretty profitable to me.

By definition the pension will remain invested for at least 21 years, probably longer, so as long as it is properly diversified, what the value does over a space of 9 months is of little importance.

atush

tubsolard wrote: »

I read this in another thread (reputable companies do not cold call) so I am wary however wouldn't a new-ish company rely on this method to obtain business?


I'm 34, so plenty of time to recover the losses to date, no real rush to be honest. I just want to know what to do with my accumulated pensions to date.


Thanks for the advice, I'll compare a few and see what the general advice is and what the rates are, certainly makes sense.


Scott

They are not allowed to by law. So no

As fro the performance of your pension, then this is due only to what YOU chose to invest in.. which you can review and change in your existing pension.


I might add that you need to add more to your pensions. looking a little int he low side.

jamesd

tubsolard wrote: »

I received a call from a company ... They are FCA approved and I have checked that they are on the FCA register.

How do you know this? A phone call doesn't come with any proof at all that the person is from the company that they claim they are from and it is very common for fraudsters to lie about it. It's particularly common with bank account fraud, where the caller will use false calling line identification to claim to be calling from the number of the bank, perhaps one on the back of a card issued to the customer.

tubsolard wrote: »

One of my pension schemes was sitting at £20,000 at the end of last year and is now just over £18,000 so it has decreased in value by just under £2,000 in less than a year.

That's entirely reasonable and expected. Stock markets have fallen over the period so it would be unusual if your value today was not lower than a year ago.

tubsolard wrote: »

I really don't have the time at the moment or the knowledge

Just leave it as it is until you have time for more work. The amount is not high enough to justify paying for professional financial advice. Or describe the investments you are using and your objectives here and people may make alternative suggestions.

tubsolard wrote: »

clearly my largest fund is not in a profitable scheme.

You've presented no evidence to support this conclusion. Did your largest fund do better or worse than the overall market for the relevant time period? If you don't know then you have no idea whether the fund did well or badly.

tubsolard wrote: »

Any advice appreciated.

For those with many decades in the future need for money a global equity tracker tracker fund is likely to be a good investment choice. If you were to pick such a fund you should be aware that it is expected, like most investments, to work like a roller-coaster in reverse. For a global equity tracker fund you should expect drops of 20% or so two or three times a decade and 40% once or twice a decade as part of the overall upward trend. Consider the modest drop you've reported over the last year in this context of what a good long term growth choice can be expected to deliver in the way of short term drops.

Malthusian

I read this in another thread (reputable companies do not cold call) so I am wary however wouldn't a new-ish company rely on this method to obtain business?

Not a reputable one, no.

If you are founding a new financial advice company, you will probably have previously worked within a larger firm and will bring some or even most of your long-standing clients with you. (There will be contractual restrictions on this, but generally, people have a relationship with their adviser, not his company, and will follow him whether the firm likes it or not.) You might also rely on advertising, or listings on directories such as Unbiased, or try to get referrals from solicitors and the like, or get a big corporate contract. Or there is the Hargreaves Lansdown route of having a really slick website that attracts execution-only business and building up from that.

So in short, there are many ways to build up a new financial advice business; no reputable adviser will call people at random.