IFA ongoing fee..Why pay?
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This is just to endorse your point 2.
I use an IFA for the equvalent of a financial health check and for tax and estate planning .Costs me about the same as my annual spend on tree surgeons.My DB pensions and other assets leave me with no stress in semi retirement.
However my sister inherited over £250k on my mother's passing.This is her sole retirement fund,other than the state pension,and it frightens her.The IFA ( who is a very kind person) has been hugely helpful in terms of talking her through diversified investments,budgeting and retirement planning.
He will not get rich solely from the 0.5% she pays him,and this is not a responsibility I wanted to take on myself .Independent third party advice in such a case is,in my opinion,worth every penny.
I'd like to second this post
I inherited a similar amount when my mum died some twenty years ago. I had no experience of investing at all - or dealing with that kind of money. The local solicitor dealing with the estate introduced me to an IFA who - as above - was kind and helpful and set me up with investments.
It worked well and I got used to the regular income and capital growth. I moved down here about six - seven years later and started thinking about early retirement. I found a local IFA who I could connect with - she and I discussed the numbers and - with much trepidation I took the plunge at age 55. Some of the investment had gone by then - in the intervening period I had been through a separation and getting a mortgage!
Since then, it's trucked along fine. I'd have to say I have become more interested in the investments - perhaps, because when I was working it was easy just to leave it all alone. I am now mid to late 60s and about to come into some more money. I think if I was ten years younger I might be tempted to do some self investing with that but now I am more than happy to let someone who I trust, like and who has provided a good service to me carry the strain. And, as has been said, assist in relieving any stress
I can, totally, see why people diy. If I was younger and/or with some experience I, as I say, might take the plunge. Perhaps another consideration was that I was in a DB pension scheme which needed no input. Pensions these days are different and, perhaps, some are more clued up on finances, in general, because of this.
I'd just re-iterate what has been said about different folks being in different situations. Some on here just see it as a race to the top - and I do get that. But, for another bunch of us, there are other considerations0 -
ZingPowZing wrote: »Let me get this right, your sister's IFA (who is a very kind person) will take £25 pw from your sister, for the rest of her life. For what?
Without any confidence in investing she would have left it in cash,so a reduction of 1.7% year on year using CPI to September
As it stands,the funds increased by 8.2% year on year ( capital appreciation and dividends) to November,net of costs.
The arrangement can be cancelled at any time.0 -
I don't get it, surely choosing 6 of the largest companies in the world provides all this? If you want to safeguard further, consider adding a seventh company.....problema solverant.This is just to endorse your point 2.
I use an IFA for the equvalent of a financial health check and for tax and estate planning .Costs me about the same as my annual spend on tree surgeons.My DB pensions and other assets leave me with no stress in semi retirement.
However my sister inherited over £250k on my mother's passing.This is her sole retirement fund,other than the state pension,and it frightens her.The IFA ( who is a very kind person) has been hugely helpful in terms of talking her through diversified investments,budgeting and retirement planning.
He will not get rich solely from the 0.5% she pays him,and this is not a responsibility I wanted to take on myself .Independent third party advice in such a case is,in my opinion,worth every penny.
<<<Yes, I am being facetious>>>Personal Responsibility - Sad but True
Sometimes.... I am like a dog with a bone0 -
Without any confidence in investing she would have left it in cash,so a reduction of 1.7% year on year using CPI to September
As it stands,the funds increased by 8.2% year on year ( capital appreciation and dividends) to November,net of costs.
The arrangement can be cancelled at any time.
Better she used an IFA than sat sat on her fortune, but better still had she stuck in a pin in the FTSE100 or 250 and blindly invested., for two reasons
1) She would very probably be richer.
2) More importantly, she would have the confidence to carry on making her own choices. How is your sister ever to gain that confidence except through experience?0 -
I don't get it, surely choosing 6 of the largest companies in the world provides all this? If you want to safeguard further, consider adding a seventh company.....problema solverant.
<<<Yes, I am being facetious>>>
I get that he is being facetious but, since he raised the disparity between the performance of the six biggest companies in the world against Daniel's sister's IFA - which is about £100,000 over the last twelve months - I can only imagine cloud-dog is sneering at Daniel's sister.0 -
ZingPowZing wrote: »Better she used an IFA than sat sat on her fortune, but better still had she stuck in a pin in the FTSE100 or 250 and blindly invested., for two reasons
1) She would very probably be richer.
2) More importantly, she would have the confidence to carry on making her own choices. How is your sister ever to gain that confidence except through experience?
1) Preserving capital in inflation terms is her priorirty .How would sticking a pin in the components of a UK index achieve that outcome ? She is about 50% invested in globally diversified funds ( using the FTSE does not achieve that) with a good proportion in fixed interest and lower risk diversified income funds,in accordance with her risk profile.
2) She is 62 and entering into decumulation in 4 year's time.Accumulation from a young age lends itself to tracker investing and is a hell of a lot easier than planning for drawdown in a relatively short time scale.
3)Once you have shot the lights out with your high risk investment strategy,you might find youself becoming a bit more risk averse when you near retirement and your tolerance for loss reduces accordingly.0 -
ZingPowZing wrote: »I get that he is being facetious but, since he raised the disparity between the performance of the six biggest companies in the world against Daniel's sister's IFA - which is about £100,000 over the last twelve months - I can only imagine cloud-dog is sneering at Daniel's sister.
No- no sneer taken or intended by cloud dog.It would self evidently stupid to invest solely in the world's largest companies in the run up to retirement0 -
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ZingPowZing wrote: »What evidence?
Have a look at the change over 10 years to 2018
Which ones would you have chosen ?
https://milfordasset.com/insights/largest-companies-2008-vs-2018-lot-changed0 -
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