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IFA or DIY - any thoughts appreciated

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  • Moe_The_BartenderMoe_The_Bartender Forumite
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    Leaving aside the question of the IFA, you would be moving from an HL SIPP to Fidelity Funds Network. The funds network is exactly that - a network of funds. No investment trusts or ETFs. Why would you want to severely restrict your choice of investments?
    The fascists of the future will call themselves anti-fascists.
  • AlbermarleAlbermarle Forumite
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    Leaving aside the question of the IFA, you would be moving from an HL SIPP to Fidelity Funds Network. The funds network is exactly that - a network of funds. No investment trusts or ETFs. Why would you want to severely restrict your choice of investments?
    I presume as a retail investor , he would actually be with Fidelity Personal Investing, not the Funds Network. In which case he would have access to to shares, ETF's and Investment Trusts. Due to the size of his pot , the platform charge would still be 0.2%, or less if he actually held shares;IT's & ETFs rather than funds.
  • Moe_The_BartenderMoe_The_Bartender Forumite
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    Leaving aside the question of the IFA, you would be moving from an HL SIPP to Fidelity Funds Network. The funds network is exactly that - a network of funds. No investment trusts or ETFs. Why would you want to severely restrict your choice of investments?
    I presume as a retail investor , he would actually be with Fidelity Personal Investing, not the Funds Network. In which case he would have access to to shares, ETF's and Investment Trusts. Due to the size of his pot , the platform charge would still be 0.2%, or less if he actually held shares;IT's & ETFs rather than funds.
    But he specifically mentioned funds network in his OP.
    The fascists of the future will call themselves anti-fascists.
  • MalthusianMalthusian Forumite
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    Leaving aside the question of the IFA, you would be moving from an HL SIPP to Fidelity Funds Network. The funds network is exactly that - a network of funds. No investment trusts or ETFs. Why would you want to severely restrict your choice of investments?
    As the OP (presumably) doesn't have any ITs or ETFs, or any inclination to buy one, the question is not "why would you restrict your choice of investments" but "why are you paying for functionality you don't use".

  • zagfleszagfles Forumite
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    euanlowe said:
    I'm going to chuck in my 2 cents. A very good friend of mine is an IFA but I manage my money myself. The overall tone of this discussion I've felt has been that the IFA's value is the fund split, but I agree with @BritishInvestor that that's almost irrelevant. If you get an IFA in, typically they will write you a 40 page document analyzing the needs of you and your family. It'll cover tax, life insurance, expense related to your kids etc. My friend charges 1 percent for this, so pretty pricey, but at least its doing the work and you get to blame them for any gaps. You seem a bit early on your self management journey, so if you do decide to manage this yourself, I am going to put forward the idea of just having it all in a vanguard lifestrategy fund which is diversified by design and very low cost - and then trying not to touch it till you retire. All the space in between, with a lot of guessing and finger in the air, can work, but generally doesn't. A good IFA is a great choice - but comes with the problem of differentiating between the good ones and the bad ones. If you are determined to figure it out yourself, I'd still put most of it into something very vanilla and play around with just a portion till you have learned how to minimize the regret linked to your decisions. I really enjoy it but its a proper nerd out following the market in your spare time. It takes a lot of work not buying high and selling low.
    Indeed - if you just want someone else to handle asset allocation, just buy a multi-asset fund.
    If you want all the rest of the above, use an IFA.

  • cfw1994cfw1994 Forumite
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    zagfles said:
    euanlowe said:
    I'm going to chuck in my 2 cents. A very good friend of mine is an IFA but I manage my money myself. The overall tone of this discussion I've felt has been that the IFA's value is the fund split, but I agree with @BritishInvestor that that's almost irrelevant. If you get an IFA in, typically they will write you a 40 page document analyzing the needs of you and your family. It'll cover tax, life insurance, expense related to your kids etc. My friend charges 1 percent for this, so pretty pricey, but at least its doing the work and you get to blame them for any gaps. You seem a bit early on your self management journey, so if you do decide to manage this yourself, I am going to put forward the idea of just having it all in a vanguard lifestrategy fund which is diversified by design and very low cost - and then trying not to touch it till you retire. All the space in between, with a lot of guessing and finger in the air, can work, but generally doesn't. A good IFA is a great choice - but comes with the problem of differentiating between the good ones and the bad ones. If you are determined to figure it out yourself, I'd still put most of it into something very vanilla and play around with just a portion till you have learned how to minimize the regret linked to your decisions. I really enjoy it but its a proper nerd out following the market in your spare time. It takes a lot of work not buying high and selling low.
    Indeed - if you just want someone else to handle asset allocation, just buy a multi-asset fund.
    If you want all the rest of the above, use an IFA.

    OP, you sound like your head is screwed well on.
    Whilst the IFA poo-poo’d your selections....I’m curious: have they done well?   Maybe you are an unwittingly special guesser!
    Your numbers are pretty decent for your age....have you an idea how much you want, what you need to live on?   I always feel an IFA ought to be doing more than just picking some funds for you.  Much more! 

    I also feel that many who come here are perfectly capable of managing their money well enough.  They have an interest to learn, perhaps some experience, and are actively seeking out answers.  Maybe you fall into this category?

    There is a mystique about IFAs, and how they make selections etc.  If you have other reasons to involve one, then go ahead.  I’ve a pal who uses one on the basis that if he died, his wife wouldn’t have a clue what to do, & would “spend it all on handbags”!
    I’m more a fan of the approach espoused by https://www.kroijer.com/ - chances of you getting the top funds or pick the best fund manager year after year after year.....are minimal: so buy into the lowest-cost global fund instead.  
    Plan for tomorrow, enjoy today!
  • saver_alisaver_ali Forumite
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    Just a thought - if you’re putting money in at such a fast rate for the next few years, keep an eye on the Lifetime Allowance. You’re some years from retirement and with decent year on year growth you might find yourself approaching it.
  • edited 7 July at 12:15AM
    MordkoMordko Forumite
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    edited 7 July at 12:15AM

    What I've been doing with that influx of money will probably make some of you scream - I've just looked at what I had and thought 'oh I should get a bit more global stuff', or 'maybe a bit more small company stuff'; - all funds, no plan.”

    1. Assuming you put lots of money in and didn’t move money out of funds into something else without plan... Not a bad approach. “Invest and forget” is a good way to make money.  People who do too much selling and buying underperform. 
    2. I would read the Edwards book and go the DIY route. Advisors are for special situations. Yours is boring and standard.
    3. I would also read something on risk to help with asset allocation. https://www.amazon.ca/Deep-Risk-History-Portfolio-Investing-ebook/dp/B00EV25GAM
    4. A multi-asset fund is always a great way to do it. Invest and forget, no need to rebalance, simple and you have just bought the whole world with one product. 
    5. If you do decide to go to an advisor, you still need to read so you can understand and make an informed decision based on his advice

  • Moe_The_BartenderMoe_The_Bartender Forumite
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    Leaving aside the question of the IFA, you would be moving from an HL SIPP to Fidelity Funds Network. The funds network is exactly that - a network of funds. No investment trusts or ETFs. Why would you want to severely restrict your choice of investments?
    As the OP (presumably) doesn't have any ITs or ETFs, or any inclination to buy one, the question is not "why would you restrict your choice of investments" but "why are you paying for functionality you don't use".

    Does it cost any more? I was with Funds Network for my SIPP and transferred to the Fidelity SIPP because I wanted access to ITs. It doesn’t cost me any more. The OP may not use the functionality now but that doesn’t mean that he might not want to in the future.
    The fascists of the future will call themselves anti-fascists.
  • BritishInvestorBritishInvestor Forumite
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     The main issue to look at is how risky the portfolio is, and whether that suits your risk profile. The rest is probably more fine tuning , although I guess not everybody would agree with that.
    Surely the starting point has to be what are the O/Ps objectives and what is the best way to go about achieving them? Risk profiles etc come a lot further down the journey, IMO.
    You are right that go through the process properly , you have to go back to the beginning about what you/they are trying to achieve.
    In this case though , the reality today is that  the OP has already cobbled together ( by their own admission) their own portfolio. So  the short term risk is that IF the portfolio is too high risk for their risk tolerance, and if there was a big market downturn, it could hit harder than they are prepared for . 
    My belief is that those with clear objectives and a (typically multi-decade) plan, and with a portfolio aligned to that plan are more comfortable with temporary market drawdowns. 
    But agreed, definitely worth making sure the O/P can live with the chosen portfolio's drawdown potential - not just short sharp drops like we've had recently but also a multi-year drags such as the 70s.   
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