Cost of financial advice

JoeCrystal

beamyup wrote: »

Are there ANY stories here of low-cost investments recommended by IFAs? e.g. pay IFA x thousand as a one-off fee, and they set up a portfolio for you with a total cost of < 0.4% PA or close?

My IFA was a one-off fee of £300 a few years ago taken from the pension pot when transferring it and the total cost is 0.45% which is close enough I suppose. Although, technically it would be 0.27% due to profit share this year. I like to stick with a transactional basis.

beamyup

Peter314 wrote: »

Here's an extract:
https://www.dropbox.com/s/ct5xat5okayfe49/charges.JPG?dl=0

Yes, as i thought, that £252 (0.03%) is exactly your platform fee (charged by alliance trust) and does not take in to account the AMCs on your funds which are approx
0.51% for L&G
0.22% for LS80

Anyway - as i said its good advice you got (assuming risk / non uk bias intent)

beamyup

JoeCrystal wrote: »

My IFA was a one-off fee of £300 a few years ago taken from the pension pot when transferring it and the total cost is 0.45% which is close enough I suppose. I like to stick with a transactional basis.

Another good example of how things should be!

dmelife

You have no idea if advice is often poor. No idea whatsoever.

DT2001

If I were an IFA I’d be concerned about good net returns as happy clients with growing portfolios would earn me more from ongoing fees. So I would have thought underlying fees would be considered.

I pay .5% p.a. and know my holdings are reviewed a couple of times a year. On average one fund is changed. I think it is good value as I no longer need to spend so much time researching.

dmelife

Underlying fees are always considered. Unfortunately there are some on here who think that improved performance, through selection of good actively managed funds, is not worth the additional fund charge.

beamyup

Yes, I'm sure there are always one or two non believers in the miracle of active management coupled with high costs.

SonOf

beamyup wrote: »

Yes, I'm sure there are always one or two non believers in the miracle of active management coupled with high costs.

And there are those that are so blinkered and biased to passive that they cannot see that there are some managed funds that are viable to hold.

[Deleted User]

DT2001 wrote: »

If I were an IFA I’d be concerned about good net returns as happy clients with growing portfolios would earn me more from ongoing fees. So I would have thought underlying fees would be considered.

I pay .5% p.a. and know my holdings are reviewed a couple of times a year. On average one fund is changed. I think it is good value as I no longer need to spend so much time researching.

Reviewing holdings and changing funds twice a year is an excellent way of ensuring underperformance.

cfw1994

Deleted_User wrote: »

Reviewing holdings and changing funds twice a year is an excellent way of ensuring underperformance.

Not sure about that, but I would certainly wonder if it was simply to make it look like the FA was working for their money!