Financial Advisor Fees

bigadaj

DesiBadBoy wrote: »

I tell you what, thats what all people who don't pass the top accreditations say. Perhaps study and practice to the highest standards, then only you can offer the best...no offence intended.

You could say the same to me about pharmacy (my profession). Though don't worry I am suping up my accreditations at university so I'm walking the walk, its not just talk

It's better not to comment when you don't know what you're talking about. You can mislead people who don't know any better.

Not that I'm saying that an accreditation from someone called desibadoy is necessarily a bad thing.........

ChemistDude

bigadaj wrote: »

So you don't use one, but are recommending a specific one.

If you don't use one at the moment why would you use an adviser going forward, I don't use an ifa or CFp, I'm happy managing my own finances and the money I don't spend on advice increases my return by definition.

Why are you recommending this guy specifically if you don't use him?

Look mate, the op is clearly in need of financial advice which is why he/she sought financial advice in the first place. Now I believe if you are the kind of person who needs it then I believe that if you are going to pay then you should pay to see the best.

The likes of me and you who are financially astute probably won't need one but its very easy to put off doing stuff coz lets face it, it can be boring. Like really, who wants to talk pensions on a sunday when the weather outside is so beautiful. I've put off getting a SIPP for a while because I'm concentrating on paying off my mortgage and a loan. Hoping to open one soon but if I don't for any reason then it might be worth my while to go see a CFP to holistically look at all my stuff and get sorted. You know what I mean? In life its easy to get off track with having kids, etc. CFP would keep me on track and help prioritise (if for any reason I didn't have the diligence I needed at the time).

ChemistDude

bigadaj wrote: »

Rather than use a local ifa, meet them face to face, get them to submit their proposals and ideally speak to at least three and choose the one you get on with and trust.

Investing isn't rocket science, just because you pay someone more money then it doesn't mean that you'll get more back. In fact if you look at the likes of st James place then by definition the more you pay them the less you get back because of the impact of fees.

Face to face is better agreed. I have merely shown the op the podcast link where they can get a ton of CFP advice for free if they have the diligence to listen and implement. If they don't but like what they hear and want it all sorting out they can go and appoint him or someone else even. Point is to use a CFP.

Mate I know about investing trust me. Have 4 Stocks ISA's maxed out don't worry. Stocks, funds, ETF's, OEIC's etc. BTL property, even a business on the horizon. Seriously don't worry about me.

bigadaj

DesiBadBoy wrote: »

Look mate, the op is clearly in need of financial advice which is why he/she sought financial advice in the first place. Now I believe if you are the kind of person who needs it then I believe that if you are going to pay then you should pay to see the best.

The likes of me and you who are financially astute probably won't need one but its very easy to put off doing stuff coz lets face it, it can be boring. Like really, who wants to talk pensions on a sunday when the weather outside is so beautiful. I've put off getting a SIPP for a while because I'm concentrating on paying off my mortgage and a loan. Hoping to open one soon but if I don't for any reason then it might be worth my while to go see a CFP to holistically look at all my stuff and get sorted. You know what I mean? In life its easy to get off track with having kids, etc. CFP would keep me on track and help prioritise (if for any reason I didn't have the diligence I needed at the time).

Fine, we're back on track which is good.

So why do you specifically recommend an individual advisor in a remote part of the country, it's just odd.

The OP has experience of dealing with regulated financial professionals and has unfortunately dealt with an individual or a firm that he has been overcharged by.

A better post would have been to use a suitably qualified adviser, shop around to find one ideally locally you like and trust, check their qualifications, try and find a recommendation from a friend or relative and ideally check their proposed fees on here.

With specific reference to your situation then for many pension contributions can be more lucrative than paying down a mortgage. This is dependent on the rate you are paying but is often advisable as it can make you an extra few per cent a year.

This obviously depends on how you invest. What do you currently hold if you don't mind me asking?

ChemistDude

bigadaj wrote: »

Fine, we're back on track which is good.

So why do you specifically recommend an individual advisor in a remote part of the country, it's just odd.

The OP has experience of dealing with regulated financial professionals and has unfortunately dealt with an individual or a firm that he has been overcharged by.

A better post would have been to use a suitably qualified adviser, shop around to find one ideally locally you like and trust, check their qualifications, try and find a recommendation from a friend or relative and ideally check their proposed fees on here.

With specific reference to your situation then for many pension contributions can be more lucrative than paying down a mortgage. This is dependent on the rate you are paying but is often advisable as it can make you an extra few per cent a year.

This obviously depends on how you invest. What do you currently hold if you don't mind me asking?

I take onboard your criticism with me recommending Pete Matthew but lets disregard that for a moment. It was my intention to simply promote his free podcast but I ended up giving his name too early. Simply listen to a few of his podcasts. The guy is an absolute legend for those who are interested and motivated by finance and want to get it right. It's smarter not to pay the fees, learn from what he tells you for free in the podcast and understand financial stuff then implement yourself to save all the fees.

As an example I have used a life insurance execution only broker to get what I want - no commissions, just a £25 fee where many perhaps would get it from a bank or pay extra from LG, AVIVA, etc websites. I didn't do this for my income protection however - but I could argue I had the astuteness to actually get some in the first place which many may overlook this product that would help you if you were unable to work. My life now won't be ruined and I'll get £2k a month for life if I bust my back and can't work for any reason - my future pension payments will continue, my retirement is protected, insured if you like (I better open up a bloody SIPP soon!!!).

Seeing as I'm leveling with you I do have a bunch in high risk AIM which I would never advise anyone to do (probably have more than I should too!) . I also have some Woodford Income Equity, Odey, Scottish Mortgage plus a few more. Its not balanced in any shape or form but I'm looking to do that with SIPPs when I get there (and actually open one) with a bunch of Global equities, property investment trusts, bonds gilts and what not. Still learning and still reading.

I'll get there eventually which is why the idea of having someone do it all for me is a fine line because I wouldn't like the idea that I'm missing out on compounding (my favourite word) because of all the fee's I'd pay an advisor of some sort.

bowlhead99

DesiBadBoy wrote: »

Not really, Those who are CFP's have passed rigorous tests to international standards. They are the cream of the crop, only a 1000 or so CFP's in the UK compared to 100,000 plus financial advisors.

Financial advisors do a KYC (know your customer) just to find out what you are missing and help you fill in the gaps (get as many commisons they can).

A CFP will take a much more wholistic view and really get your finances in order sorting everything out and is more of a long term relationship whereby goals agreed are reviewed periodically taking into account changing circumstances and life events both good and bad. They will be much more transparent with fees, commissions and abide by higher standards than the regulations require. They don't sell you anything.

(Text removed by MSE Forum Team)

By regurgitating marketing material, because you have believed the hype from someone who is a CFP or intend to become one yourself.

They are the 'cream of the crop' because there are not many of them? Well, there are not many Proton Savvys or Dacia Sanderos on the streets of the UK either, but this doesn't make them a better long term ownership proposition than a more reliable Skoda, or a more luxurious Merc or Jag.

There are not many of them because it is not many years since Chartered Insurance Institute decided to offer people the chance to become 'chartered' financial planners or insurance brokers. If you go on the CII website and click on the page about 'chartered' status you get a lot of waffle about how Chartered professionalism traces its roots to the years after the Norman invasion of 1066. So if you can add 'chartered' to your name, maybe you will get some more respect and start charging higher prices. But there have not been Chartered Financial Planners since 1066; it is only a couple of decades since that Insititute started to hand out Financial Planning Certificates and it took many more years before they were allowed to offer a qualification with Chartered in the name.

Using the same logic, at some point some industry body will offer the opportunity to pay money for training and ongoing membership fees so you can start calling yourself a Chartered Waste Management & Disposal Executive Technician instead of a Bin Man. It doesn't make you the cream of the crop over a guy who's been doing it thirty years and kept up to date with the latest regulations and techniques.

Personally I'm a 'Chartered' accountant - the Institute of Chartered Accountants in England & Wales has been going since 1880 (there are about 140,000 of us around the world) and the Scottish ones have a similarly long history. There are certainly some bad apples but we generally know our stuff. If you created another organisation to start offering accounting exams in 2011 and called it the Super Accountant qualification, perhaps five years later you could say you had only 1000 members compared to the Chartered accountants with 100k+ or the other types of qualified and unqualified accountants which number in the millions worldwide. There would be fewer Super Accountants but if the syllabus is the same and the time in industry is lower would that truly make you the 'cream of the crop'?:rotfl:

As mentioned above, the idea that independent financial advisors work for 'commissions' rather than taking a 'wholistic' [sic] view of a client's needs is archaic.

You have just bought into the hype from someone who has a particular qualification that he bought from the Chartered Insurance Institute instead of from the Chartered Institute for Securities and Investment. A layman looking for financial advice would perhaps assume that the qualifications issued by a Securities and Investment Institute would be more suitable than the qualifications issued by an institute that offers Chartered Insurance Broking qualifications. So perhaps your buddy who went with the Insurance Institute is just trying to overcompensate for that, and brainwash you into thinking he's the best in the business because of his choice of qualification route because he knows most people will not have even heard of Chartered Financial Planner because it is a newer upstart qualification.

Insurance is not particularly known for its transparency or going above and beyond what regulations demand, so maybe he is trying to deflect that by shouting loudly about how awesome his designatory letters are. But it pays to be a cynic.

DesiBadBoy wrote: »

I'll get there eventually which is why the idea of having someone do it all for me is a fine line because I wouldn't like the idea that I'm missing out on compounding (my favourite word) because of all the fee's I'd pay an advisor of some sort.

Yes, but by having a terrible portfolio that is, as you admit, 'not balanced in any shape or form' you are saving those fees from paying an advisor, while potentially destroying your returns so that perhaps you have far less available to compound than if you had paid a fee and did it right.

Advice can be expensive though so if you only have small amounts of money it is fine to learn from your mistakes and from your reading until you have larger amounts; by which point, you can make an educated decision on whether to employ someone or continue to DIY on the larger amounts.

dunstonh

A CFP will take a much more wholistic view and really get your finances in order sorting everything out and is more of a long term relationship whereby goals agreed are reviewed periodically taking into account changing circumstances and life events both good and bad. They will be much more transparent with fees, commissions and abide by higher standards than the regulations require. They don't sell you anything.

You have just described the advice process that most IFAs offer. You havent described a process only done by a certain type of qualification. I suspect you are perhaps mixing up tied agent FA who would normally be transactional with an IFA who would normally be ongoing. The qualification type doesnt decide that. The distribution type does. Plus, commission hasnt existed for some years now.

sandsy

The minimum level of qualifications for an investment adviser is the equivalent of QCF level 4 (considered to be first year university level).

CFP is QCF level 6 (degree standard).

Just passing the exams might give someone the right to use more letters after their name but it's the way they practise their profession that counts.

BananaRepublic

bowlhead99 wrote: »

It sounds like you are talking crap by regurgitating marketing material, because you have believed the hype from someone who is a CFP or intend to become one yourself.

There is no need to be abusive. Your post contains nothing substantive. You might wish to look into the qualifications required for each title. You might be right, that the CFP is not better than IFA, but your post did not prove that assertion. Incidentlly I have seen an IFA post marketing material in this forum and you did not take umbrage.

dunstonh

ou might be right, that the CFP is not better than IFA, but your post did not prove that assertion.

CFP is a qualification from one of the examination boards. IFAs can have it. Restricted advisers can have it. A compliance officer who never sees a client can have it. A paraplanner can have it and a tied sales rep of one company can have it.

Incidentlly I have seen an IFA post marketing material in this forum and you did not take umbrage.

Any IFA posting marketing material gets reported PDQ. They also get heavily criticised by those of us that post here regularly.