Financial Advisors are useless

GreenSnake

Alice_Holt wrote: »

Or in the much riskier business of BTL.

I wouldn't touch BTL myself.
But over the long term (i.e. 40 years plus), I think owning a second property would be better than cash.
So long as you hadn't borrowed against it.
Even allowing for tax increases, bad tenants, maintenance etc.

Back when I were a lad....

...being a landlord wasn't very common. It was a bit like owning a farm is today.
Lots of reasons why.

Now it seems to be a first thought for anyone with £20k in the bank.

EachPenny

ValiantSon wrote: »

Maybe so, but "the man from the Pru" was tied to Prudential. In the 80s they got a lot of people to transfer out of DB schemes and take their rubbish pension schemes instead. This was happening with Prudential advisers making that recommendation. Those advisers not tied to Prudential may well have given different advice, but "the man from the Pru" did.

I'm not sure you appreciated the point in my post. Whilst the company as a whole and some advisers might not have had the customer's interests at heart, that was not universally the case. As I said, "We knew we could trust him because he lived amongst us, and one bad bit of advice would have ruined his reputation across his whole client base quicker than you can say "FCA"."

If you live and work in a rural community your honesty and integrity are important to you. You don't live in the community for long if your neighbours don't trust you, and there isn't an endless supply of 'punters' that you might be able to find in towns and cities.

People living in communities like that are less likely to even think about having a formal meeting to discuss their investments, so I can see the point dunstonh was making. The loss of less formal advice to people who perhaps need it more than any is not to their benefit, whatever the rule makers believe.

ValiantSon

EachPenny wrote: »

I'm not sure you appreciated the point in my post. Whilst the company as a whole and some advisers might not have had the customer's interests at heart, that was not universally the case. As I said, "We knew we could trust him because he lived amongst us, and one bad bit of advice would have ruined his reputation across his whole client base quicker than you can say "FCA"."

If you live and work in a rural community your honesty and integrity are important to you. You don't live in the community for long if your neighbours don't trust you, and there isn't an endless supply of 'punters' that you might be able to find in towns and cities.

People living in communities like that are less likely to even think about having a formal meeting to discuss their investments, so I can see the point dunstonh was making. The loss of less formal advice to people who perhaps need it more than any is not to their benefit, whatever the rule makers believe.

Perhaps you are right about rural communities, but using Prudential as an example is not a great one.

BananaRepublic

BTL is a lot less lucrative than it was. The way they calculate the tax is now less advantageous as you can’t simply reduce your tax liability with your mortgage interest payments. And then there is higher stamp duty.

Fatbritabroad

EachPenny wrote: »

I'm not sure you appreciated the point in my post. Whilst the company as a whole and some advisers might not have had the customer's interests at heart, that was not universally the case. As I said, "We knew we could trust him because he lived amongst us, and one bad bit of advice would have ruined his reputation across his whole client base quicker than you can say "FCA"."

If you live and work in a rural community your honesty and integrity are important to you. You don't live in the community for long if your neighbours don't trust you, and there isn't an endless supply of 'punters' that you might be able to find in towns and cities.

People living in communities like that are less likely to even think about having a formal meeting to discuss their investments, so I can see the point dunstonh was making. The loss of less formal advice to people who perhaps need it more than any is not to their benefit, whatever the rule makers believe.

Yes a someone who works on the commercial insurance side where commission is still the norm I was quite pro rdr. The Downside is as you say those that need the most help don't get it now as they are priced out. I fear for small complex businesses that try and buy business insurance online if they bring it in on our side. With tax going up to 12% I've moved most of my larger clients on to a fee basis anyway as I can save them 500 to 600 year in tax. I've never had the issues some older brokers have had discussing commission. If I felt uncomfortable I shouldn't be taking that much. I also think fees would be better than commission disclosure as some of the commissions aren't straight forward. For instance. We only tend to earn 10% on fleets where margins are low but can earn 40% on some fringe products like business travel. But we produce all the documentation from our system so have the print costs. They are also our bespoke wordings that we produced so the client is getting wider cover generally than the norm. Plus the volume of business we place with the insurer means w egret a larger cut. Ultimately the premium is still competitive for the client . These are very very small premiums( 200 or less generally). But actually over the whole client programme it generally works out 15 to 25% of the premium. If you say you earn 20% of a 20000 policy most clients won't bat an eyelid. If you say you earn 40% of a 180 travel clients quite rightly hit the roof

capital0ne

dunstonh wrote: »

Another anti adviser post by the OP. Trying to provoke responses that can no doubt be reported. Time for you to give up the trolling.

Cheers Dunsty, much appreciated, on a more positive front, could you publish a typical cost for managing a small £100k portfolio to provide a monthly income an growth 1% above inflation.