Choosing an IFA and fees

Bianchiintenso

Very much appreciate the input, thanks all

drphila

dunstonh wrote: »

Commission was abolished in 2013. Its all fee based now (except on contracts arranged prior to 2013 where it can be retained). Some people dont need ongoing services. Some do. I just did a case for someone this morning that is transactional (no ongoing). I am about to start another which is very similar but will have ongoing service. The amounts are similar too. The one without servicing is using more basic investments because there is no ongoing servicing) and the one with is using more advanced options. Most IFAs are happy catering for all types.

I found the number of IFAs willing to offer a transactional service very limited as compared to those offering an ongoing service.

dunstonh

drphila wrote: »

I found the number of IFAs willing to offer a transactional service very limited as compared to those offering an ongoing service.

It is a regulatory requirement for IFAs to offer transactional and ongoing. An IFA cannot insist on ongoing.

Some boutique firms own model is to provide an investment style and advice process that really needs an ongoing service. They don't want transactional. Most of these have converted to FA status and dropped being IFA. However, some out there still refer to themselves as IFAs.

A lot of FA firms try to make out they are IFAs by using different phrases that are similar but not actually saying the word independent. e.g. whole of market.

Research many years ago found over half the people seeing an FA thought they were seeing an IFA. Maybe the reluctant ones are these.

spud312r

I'm 58 and looking at retiring at 62.

I have 4 pensions totalying around £500k
Aegon MIXED A FUND (paid up £195k 1% fee)
Aegon UNIVERSAL LIFESTYLE(paid up £10k .7%)
Scottish Widows (serps)(paidup)
Scottish Widows Portfolio 3/4

I wanted to consolidate all of them into Scottish Widows Portfolio 3/4 , i contacted Aegon and collected all the transfer information/forms

But when i called SW they stated that i had to get a FA and couldnt transfer them myself, i even tried to transfer teh scottish widow (serps) fund into the Scottish Widows Portfolio 3/4 and resultst were the same, i need a FA which will cost me £1500 for intial research if its the best thing to do and 1.5% fee for actually performing the transfer..

I seem to being forced into using a FA to perform the consolidation ??

End result is i want to reduce fees and have one drawdown fund/provider ??

Is this normal practice ??

drphila

dunstonh wrote: »

It is a regulatory requirement for IFAs to offer transactional and ongoing.

Thanks for that, very interesting. Could you point me to the regulatory documentation, please. Because in view of the number of IFAs who refused to entertain transactional, I think I need to raise this with the FCA.

JoeCrystal

dunstonh wrote: »

Research many years ago found over half the people seeing an FA thought they were seeing an IFA. Maybe the reluctant ones are these.

I am not surprised actually. I am already starting to think the ones I used are not IFAs either few years back but oh well, at least they did what I asked them to with the pensions.

bostonerimus

I don't want to comment on the nuts and bolts of DC pension transfers and consolidations in the UK, but I will generally say that I'm always sad and angry and amazed at the way UK pension investors get messed about by an industry and legislative landscape that treats them like children unable to make reasoned decisions about their money. Financial institutions holding DC pots when instructed by the account owner to jump should reply "how high".....and they or some FA or IFA should not be getting a pound of flesh either. Advice should be available if wanted and needed, but it should not be a requirement for any transaction on a DC pot. Compare the UK situation to the one in the US where I can consolidate any DC retirement account from an ex-employer or held at any financial institution into an Individual Retirement Account (IRA) available through banks, brokers and mutual fund companies and no cost and with very little paper work. My last transfer of a 403b (non-profit tax deferred DC account) to an IRA took a single sheet form and was completed in a week.

dunstonh

I seem to being forced into using a FA to perform the consolidation ??

No you are not. However, you are choosing to use a provider that only retails via advisers (or at least the product versions you have require it).

End result is i want to reduce fees and have one drawdown fund/provider ??

So, why are you trying to transfer it within SW?

BLB53

End result is i want to reduce fees and have one drawdown fund/provider ??

I suspect the solution will be to set up your own SIPP with the likes of AJ Bell Youinvest and arrange for them to consolidate your various pensions into the one SIPP which you then control and manage.

spud312r

"No you are not. However, you are choosing to use a provider that only retails via advisers"

Thansk - I wernt aware of that ..