Where can we get help to understand this?

FatherAbraham

AnotherJoe wrote: »

I suspect the issue is, advisers now have to give figures according to a set of standard projections. Whoever you invest with and with whatever mix of funds, they all have to use the same return projections. Making a mockery of the whole thing (except possibly to show up the effect of charges which you've noticed)

I'm struggling to understand how you think it would be better if advisors were allowed to just make projected growth figures up, rather than using standardised rate based on underlying asset classes.

There was a big misselling scandal around optimistic projected growth rates on endowment policies in the 1980s.

AnotherJoe

FatherAbraham wrote: »

I'm struggling to understand how you think it would be better if advisors were allowed to just make projected growth figures up, rather than using standardised rate based on underlying asset classes.

There was a big misselling scandal around optimistic projected growth rates on endowment policies in the 1980s.

A reasonable point, but the issue is that with standardised rates is it's impossible to distinguish between different investment strategies, let's say VLS20, VLS100 AND "Russian Small Companies fund", how would you pick between them if they all "apparently " show as having the same return ? Plus, I don't think it's made clear that these returns are not forecasts or even estimates but are arbitrary. Completely arbitrary.

It's certainly puzzled the OP, who asks a reasonable question "why would I invest in x or y fund if the number will be lower in 4 years time?" (and by extension since the existing fund would have the same issue, they should sell that all and go 100% cash from now on)

dunstonh

I'm struggling to understand how you think it would be better if advisors were allowed to just make projected growth figures up, rather than using standardised rate based on underlying asset classes.

Actually, advisers are not required to use the rates the FCA forces providers to use. Advisers can use various methods as long as the rates and method are justified. it is providers that are forced to use the FCA method. And that method is causing more damage than good at the moment.

AnotherJoe

dunstonh wrote: »

Actually, advisers are not required to use the rates the FCA forces providers to use. Advisers can use various methods as long as the rates and method are justified. it is providers that are forced to use the FCA method. And that method is causing more damage than good at the moment.

Thanks Dh, I didnt know that, live and learn every day !

dogsbestfriend

I telephoned the FA's office today to clarify the position regarding IFA or not and firstly spoke to the receptionist who became very uncomfortable when I asked if they were an IFA and put me on hold

Within seconds I was transferred to one of the partners who explained that they are a Restricted Plus team of advisors

He said that they wear two hats - as a Restricted Plus company this means they can only offer certain products or providers. He said that if the client's circumstances demands an IFA they can then put on their IFA hat to offer a broader spectrum from across the board

Does this mean that the transfer to Old Mutual was because it it the best thing for us or because it was the best they can offer from a limited range of products?

Am I being flannelled or am I reading too much into this?

PS At no point were we told that they were a Restricted Plus company

dunstonh

Does this mean that the transfer to Old Mutual was because it it the best thing for us or because it was the best they can offer from a limited range of products?

Are they members of the instrinsic network? Check bottom of letterhead or the FCA register where it shows whop the principal is.

If they are, then Intrinsic restricted members are forced to use OMW platform.

He said that they wear two hats - as a Restricted Plus company this means they can only offer certain products or providers. He said that if the client's circumstances demands an IFA they can then put on their IFA hat to offer a broader spectrum from across the board

That is not putting your clients best interests at heart. it is a commercial decision they have made to earn them more money. i.e. we will put you with something that earns us more (through reduced costs) but if you force us, we will reluctantly get an IFA to sign off on something else even though it costs us more.

Dual authorisations for restricted and independent are not common. Most directly authorised IFAs have absolutely no reason to restrict. What happens if you restrict is that you get higher commission rates on insurance products and often compliance support at reduced costs on investment products. e.g. Intrinsic and OMW platform are in the same group of companies. So, Intrinsic offer reduced compliance costs if you use OMW.

Network authorised advisers are nearly all restricted nowadays as the network has the ultimate liability for the advice. Modern regulatory and compliance standards have an emphasis on systems and controls. Networks, with their hundreds/thousands of advisers, are too big to allow their advisers to be independent. They have to restrict them to prevent liability (both of complaints and regulatory fines) becoming too great.

Does this mean that the transfer to Old Mutual was because it it the best thing for us or because it was the best they can offer from a limited range of products?

Investment platforms can be a bit like choosing a supermarket to buy from. Everyone has a preference and each supermarket has a target market. Sometimes, a shop may be very attractive when it opens. However, without continuous updating, it can become tired and get left behind. My opinion is that OMW has become just that. It is still using the old Selestia software that requires the use of internet explorer in places (Selestia was the original platform before it was bought by Skandia who then rebranded to Old Mutual and are about to rebrand again to Quilter as Old Mutual are demerging). It is not a whole of market platform and its pricing is looking dated compared to others now. Although if you have enough on there, it may not be too bad. OMW is moving platform provider next year and using FNZ. That is positive depending on what they do with their front end and how they configure it. As it stands, we are not placing any new business on OMW but keeping existing where it is whilst we wait and see what they do with the new software and if they change their pricing model. If not, we will start moving people away from them next year. That is my opinion. Others may feel differently.

Am I being flannelled or am I reading too much into this?

PS At no point were we told that they were a Restricted Plus company

Restricted companies do try and avoid it as much as possible using words that give impression of a wide selection but not actually using the word "independent". So, it is very easy to end up seeing a restricted FA with you thinking they are an IFA. If the adviser skirts around the word independent then they are not.

Also, the initial disclosure documents given right at the start of a meeting state the employers status. IFAs will usually point it out that they are independent. Restricted FAs may gloss over it.

if you were not told then it tells you are lot about the company in question.

xylophone

Have you looked for a local Independent Financial Adviser?

https://www.moneysavingexpert.com/savings/best-financial-advisers/

https://www.moneyadviceservice.org.uk/en/articles/choosing-a-financial-adviser

And have you checked your state pension situation?

dogsbestfriend

xylophone wrote: »

Have you looked for a local Independent Financial Adviser?

And have you checked your state pension situation?

Xylophone, we have requested a forecast and we are definitely both entitled to the full State Pension of £8546.20 in 2029

We had hoped to learn from engaging an IFA (or FA as it turns out) is whether the pots of pension we've accrued will be enough from when we both hopefully retire in 2022 at 60 until our State Pension kicks in

We have savings of £80,000 and a house worth £750,000 which is now mortgage free after many years of overpaying

Our children have all flown the coop now so at 60 we can downsize which will give us some more for the pot

Following my research and Dunstonh's comments I am growing uneasy about the FA's motives and will start to research local IFAs ASAP. I would like to give the FA the benefit of the doubt but I can see that the saying "If you assume....." is spot on in this case. We made assumptions and now need to extricate ourselves

dunstonh

Following my research and Dunstonh's comments I am growing uneasy about the FA's motives and will start to research local IFAs ASAP. I would like to give the FA the benefit of the doubt but I can see that the saying "If you assume....." is spot on in this case. We made assumptions and now need to extricate ourselves

If you want me to check the FCA register to verify their status (ie. is it OMW's own group - Intrinsic) then PM me with the company name (rather than post it on an open forum). Alternatively, go to https://register.fca.org.uk and search for the firm.
then look to see if there is a section called principals. Directly authorised IFA firms do not have that section. Only network members. If that section is there and the principal firm listed is Intrinsic then you know the recommendation was for "own" product.