PENSION WISE ANY GOOD.

dunstonh

So you had a form. All it needs is a customer to put their details on it and sign it and you have an instant payment of £500.

Thank you for explaining what the IFAs are all doing wrong.  We better go back to the FCA and tell them that Fred has said we don't have to do anything the FCA require or any of the things required to do the job.

So all the FAs were out looking for customers while the IFAs sat on their bottom waiting to be contacted?

That is pretty much how it worked then and how it works today.  Most IFAs find it comes to them with no advertising required.

I have used IFAs in the past but am unlikely to ever use one again based on previous experience.

And on behalf of all IFAs, I thank you for that.

People are charged a fortune to set up investments and then the IFA wants them to pay an ongoing annual fee for very little. 

Wrong.

Customers can refuse it but the IFAs make them feel very uncomfortable to refuse.

No they don't.   And as you haven't used an IFA you wouldn't know what happens.

cfw1994

clive0510 said:

luvchocolate said:

I had a meeting with them a couple of years ago. I understand they should not give advice but the lady I saw actually said "if I were you.......""

That's what im going to do. I've filled in there on line form and they're going to send the necessary in the post.need to get this right. worked all my life for it.

I would suggest you DYOR first (do your own research!): trawling this forum, maybe putting some thought yourself into your plans/hopes, and certainly getting all your pension details/info to hand.
I had a meeting with them last summer: it was pretty basic, but they were able to confirm things I thought I understood but wasn’t 100% certain.

& do please excuse Fred: his father once got turned over by a Financial Advisor, & Fred has suffered a severe allergy to them ever since 😂

I also don’t use an IFA (like a few here - it is a moneysaving forum, after all)....but as dunstonh rightly points out, DIY badly and it will cost you: DIY well and you can of course save some money.
I do, however, definitely recognise many people who don’t have the confidence to manage their own funds can benefit from them!

fred246

cfw1994 said:

clive0510 said:

luvchocolate said:

I had a meeting with them a couple of years ago. I understand they should not give advice but the lady I saw actually said "if I were you.......""

That's what im going to do. I've filled in there on line form and they're going to send the necessary in the post.need to get this right. worked all my life for it

& do please excuse Fred: his father once got turned over by a Financial Advisor, & Fred has suffered a severe allergy to them ever since 😂

Have you actually read what I have written? An IFA sold me a pension to get the commission. They mainly put it in with profits but they also invested some in money market funds. 40 years before retirement and they put it there. Then they told me to stop paying in because it was rubbish! Is that a good service? Then she got me quotes from the 'whole of the market' for life insurance. I got a quick quote from Tesco which was cheaper so I took it out and she was furious because she had missed out on her commission. I won't even start about another IFA who gave us a seminar and told us a load of rubbish. Their charges are totally out of proportion to the work they do.

zagfles

I'm almost as sceptical of the financial services industry, not just IFAs but FAs, banks, brokers etc. When I went for my first mortgage in 1990, nearly every bank, building society and broker were trying to push endowments, it was actually a struggle to get a mortgage without one. Even in my 20's I knew they were rip off high charge products which generated huge commission to the person or organisation who sold it, something like the first 2 years premiums were commission!! Yet the gullible majority bought an endowment with their mortgage at the time.

Then there was pension misselling where people were persuaded to leave excellent final salary schemes for some rubbish with-profits pension with no employer contributions, and similar charging structure to endowments, then there was PPI with banks/lenders charging a ridiculous amount to people who were incapable of assessing risk and the value of insurance.

But of course all the past scandals have caused increased regulation and now the biggest problem is probably getting advice that is genuinely in your best interests rather than advice which is "backside covering", ie less likely to get the IFA into trouble. There was an example here of an IFA putting their client into an expensive multi-asset fund rather than a balanced selection of cheaper single asset funds. Reason given by an IFA? Because if one of the single asset funds plummetted the client might go into panic mode and sell it!

I went to a retirement seminar a few months ago, organised by my union. It included what was basically a sales spiel from an IFA. Most of the audience were people coming up to retirement with a DB scheme. There was some good stuff, but he made a big deal out of "we don't do DB transfers, they're generally a bad idea", but then was trying to sell the idea of commuting the DB pension to get the max PCLS which he could then invest! So he doesn't do DB transfers at maybe 35x typical CETV, but he's happy to advise commuting at typically 10x !! Or rather, probably not "advising" but hoping people come to him after they've done it already, so he's not on the hook for the decision to commute. Even accounting for tax and hedging, which could be replicated with a full transfer even if it involved annuities, it was clearly nonsense.  It may have been sensible for schemes with a high commutation factor, but he didn't suggest people check that as a factor in their decision.

As proved here, you're really better off understanding things yourself, or trying to. Even for the more complex issues, like technicalities surrounding the AA and LTA, discussions here generally involve interested amateurs rather than IFAs. We've seen examples both first hand and second hand of IFAs clearly not understanding issues surrounding the LTA, AA etc.

That said, I'm sure good ones do exists! Probably like builders, the ones you can't get hold of because they're booked up for the next year are the best!

fred246

We always had seminars off IFAs. In the early days with huge commissions we would have nice meals. I distintively remember an IFA saying commission was so good he would buy a chinese for us. I also remember when they banned commission and the IFA saying they would charge £200 an hour for advice. Everybodys jaw just dropped. £200 an hour was just unheard of even for real professionals. The last seminars we had were sandwiches from the budget range eg cheese and onion or tuna and sweetcorn. I don't think they had much to sell. You will always get people who pay for services that others would happily do themsleves.

dunstonh

fred246 said:

We always had seminars off IFAs. In the early days with huge commissions we would have nice meals. I distintively remember an IFA saying commission was so good he would buy a chinese for us. I also remember when they banned commission and the IFA saying they would charge £200 an hour for advice. Everybodys jaw just dropped. £200 an hour was just unheard of even for real professionals. The last seminars we had were sandwiches from the budget range eg cheese and onion or tuna and sweetcorn. I don't think they had much to sell. You will always get people who pay for services that others would happily do themsleves.

For someone that is so anti-IFA, you say you recently went to a seminar run by an IFA.  You are very hard to believe.    

LHW99

fred246 said:

You will always get people who pay for services that others would happily do themsleves.

That I can agree with, if not much else. And fair play to them, as long (as said) they have taken a minimum of care to ensure they are employing someone who has the relevant regulatory etc knowledge. Its how I keep my car on the road and get a certain amount of building work etc done. I don't want to do it, and I go to someone who enjoys doing it and is capable. Positives all round.

I enjoy fiddling with numbers and spreadsheets, not everyone does or should, and if they feel buying that skill in is worth it by giving them time to build their own house, take trips to the other side ofthe world (not at the moment though) - why not?

fred246

dunstonh said:

fred246 said:

For someone that is so anti-IFA, you say you recently went to a seminar run by an IFA.  You are very hard to believe.    

Well I am interested in finance so I always went to the seminars but I never employed them. I would have preferred chicken tikka sandwiches or BLT but cheese and onion were OK if they were free.

Malthusian

zagfles said:

But of course all the past scandals have caused increased regulation and now the biggest problem is probably getting advice that is genuinely in your best interests rather than advice which is "backside covering", ie less likely to get the IFA into trouble. There was an example here of an IFA putting their client into an expensive multi-asset fund rather than a balanced selection of cheaper single asset funds. Reason given by an IFA? Because if one of the single asset funds plummetted the client might go into panic mode and sell it! 

That sounds like good advice to me, assuming the IFA's analysis of their risk profile was correct. Less knowledgable investors viewing funds in isolation instead of as part of the whole is an inherent problem with multi-fund portfolios. People with lower investment knowledge should be recommended less complex solutions.

And although we're back to backside-covering, the FOS tends to view funds in isolation rather than as part of an overall portfolio as well. Thinking about what the FOS might say in the event of a complaint may be "backside-covering" but it still has to be done. Neither IFAs nor their clients make the rules.

A single multi-asset fund can be as expensive or cheap as a multi-fund portfolio so expenses have nothing to do with the choice between single multi-asset fund or multiple single-sector funds.

cfw1994

fred246 said:

cfw1994 said:

clive0510 said:

luvchocolate said:

I had a meeting with them a couple of years ago. I understand they should not give advice but the lady I saw actually said "if I were you.......""

That's what im going to do. I've filled in there on line form and they're going to send the necessary in the post.need to get this right. worked all my life for it

& do please excuse Fred: his father once got turned over by a Financial Advisor, & Fred has suffered a severe allergy to them ever since 😂

Have you actually read what I have written? An IFA sold me a pension to get the commission. They mainly put it in with profits but they also invested some in money market funds. 40 years before retirement and they put it there. Then they told me to stop paying in because it was rubbish! Is that a good service? Then she got me quotes from the 'whole of the market' for life insurance. I got a quick quote from Tesco which was cheaper so I took it out and she was furious because she had missed out on her commission. I won't even start about another IFA who gave us a seminar and told us a load of rubbish. Their charges are totally out of proportion to the work they do.

I thought you posted quite some time ago about your father being turned over by a Financial Advisor?   Maybe I recalled incorrectly - if so, my apologies!
Yes, this time it was you.   But many years ago: before the current regulations, right?

I don't disagree that a person can avoid many charges/fees by doing it themselves, and personally advocate & prefer that.....
BUT....that person has to have good knowledge and confidence in what they are doing, be able to properly recognise their own appetite for risk and chose their investments accordingly.   
Many of us have skills in certain areas, whether that be plumbing, engineering, IT, dentistry, whatever - the money you pay is not for the short time that person is helping you solve a problem - you are essentially paying for the experience that person has earned over many years.    A locksmith can drill out a lock in 5 minutes and get you in your locked house.....but you are paying maybe a few hundred for their knowledge of where to drill, how to do it, etc!

Doesn't mean IFAs don't have a place.   Heck, & this will upset some, even FAs may have a place - our last mortgage was with HSBC, the young lady there was VERY capable and competent at sorting it out, no excessive pressure on add-ons.....but certainly, for major long term investments, a true IFA would clearly be better.

Finding one you trust is perhaps the hardest thing.   There is, IMHO, still a faint whiff of "sales patter" about some of them (certainly in the retirement seminar I went to last summer!).   Present company of IFAs responding here very much excepted!!!