Eggs in One Basket: All savings moved into WRAP?

Twointhebush

My FA is advising that my wife and I move all of our savings/ISAs into our WRAP accounts. Is this a case of placing all of our eggs in one basket?

Spreadsheetman

Not necessarily, the underlying bond/equity investments could remain exactly the same (depending on which wrap - with Standard Life and Aviva you'd be able to keep everything the same, I don't have experience with others).


I certainly wouldn't move any cash or cash-like (e.g. cash isa) investments in there though, wrap cash interest is negligible and you'd do better outside.

bostonerimus

How much will this cost? and what funds are offered? It strikes me that the FA is asking you to pay for someone else to do what he/she should be doing for the fee you are already paying them.

dunstonh

My FA is advising

FA or IFA. FAs should not be used. It should be an IFA.

Is this a case of placing all of our eggs in one basket?

Depends on what you mean by eggs in one basket.

If you put the investment into the wrap and selected just one fund then it is in "one" fund. However, if that fund will be in a spread of assets. if that fund is multi-asset fund then it will be heavily diversified. Probably less than 1% in any one holding. If it is a spread of funds, then they will be with different investments too.

and what funds are offered? It strikes me that the FA is asking you to pay for someone else to do what he/she should be doing for the fee you are already paying them.

1 - its a wrap. So, that is just about 30,000 funds/investments offered.
2 - don't they have platforms in the US? I am just wondering if there is a misunderstanding on your part as to what a platform is in the UK compared to where you are in the US. Most investments go on platforms nowadays. What the adviser does and what the platform does has no overlap.

Not sure if a post has been deleted or edited as I cant see anything where you can get the view that the FA is asking the OP to pay someone else to do what they should be doing.

bostonerimus

dunstonh wrote: »

1 - its a wrap. So, that is just about 30,000 funds/investments offered.
2 - don't they have platforms in the US? I am just wondering if there is a misunderstanding on your part as to what a platform is in the UK compared to where you are in the US. Most investments go on platforms nowadays. What the adviser does and what the platform does has no overlap.

Not sure if a post has been deleted or edited as I cant see anything where you can get the view that the FA is asking the OP to pay someone else to do what they should be doing.

I'm asking questions to understand the terms of this consolidation. Presumably the OP has their funds (savings, ISAs and pensions) with a few providers and platforms and the FA wants to have them all together to make life easier, but what is the cost and will any investments change in this consolidation.

Of course the US has many financial services companies that allow you to hold a full range of saving. regular investments and retirement accounts on a single platform, but it is not necessarily always the bets way to go. I use Vanguard for most of my investing, but still hold money on other platforms because of certain tax advantages and access to guaranteed high levels of interest.

AnotherJoe

What are "WRAP" accounts? With capitals?



There are wrapped accounts, but an ISA is a wrapped account so it seems strange to say you are moving an ISA into a wrapped account.


Is WRAP an acronym?

sabretoothtigger

WRAP sounds ideal if its cheaper overall. The funds themselves would not be a liability when managed because the assets are held in trust, just my basic understanding you are not risking in the same way cash held anywhere is at risk.

The provider of the WRAP would not be holding your asset worth as such, their business is in the management and capital worth is actually separated by law. So if that was the question about risk, its already handled safely afaik.
Stay away from anything like a ETN which is debt not an asset, but most people are fine with their funds I would state very generally

Can anyone mention a WRAP provider they like that I can check, I might be moving around if that were the cheaper option for me

dunstonh

Fund supermarkets are those platforms that just offer a [large] selection of funds. They usually only offer limited tax wrappers

Wrap platforms are the ones that often full investment options (anything on the LSE and whole of market on funds etc) and offer all the major investment wrappers.

most fund supermarkets have moved to wrap platforms or are in process of doing so.

Many just refer to platforms as platforms and dont use the full name of Wrap platform any more.

Can anyone mention a WRAP provider they like that I can check, I might be moving around if that were the cheaper option for me

Snowmans sheet is probably best for the DIY market.