Pensions. Is an IFA really worth it?

BritishInvestor

cfw1994 said:

t8769 said:

I have a simple savings requirement, not a huge amount of money to invest.
Just need a pension, and to invest other finds in a mix of high, med and low risk.
Could I do this myself  or is it worth paying an IFA?
Would they get higher returns to make their fees worthwhile?
Nothing complicated about my requriements.

Thanks

This thread has drifted off topic a lot, as IFAs better terms about.
I suspect you may be terrified to take the steps to manage your pot without their guiding hands now, due to discussions of alpha and retail v consumer etc etc.......but as someone just reminded us: yes, you could do it yourself, and yes, it might be possible you could benefit from IFA help!
Let us know how anyone here can more specifically help you before the thread explodes 

As mentioned at the start of the thread, no need for an IFA (at this stage), but a bit of reading might help the O/P to build a better understanding of investing etc.

AlanP_2

Joey_Soap said:

BritishInvestor said:

Joey_Soap said:

The answer the OP seeks is "no". ZPZ is on the money here. And a solution from Vanguard or one of the robo-advisors is likely to be at least as good as an IFA will manage. Meantime, read as much as you can about building and maintaining a portfolio yourself. Then decide whether a robo/Vanguard style of portfolio is what you want. You can then decide for yourself whether managing your own money is for you. Or even if you want to use an IFA after all. My own opinion is that using an advisor should really be a last resort. But if you actively choose to do so from an informed point of view, then fine. HTH.

You'd have to provide evidence on the robo-adviser performance as most I've seen have very average outcomes (upon cursory inspection). 
A number of advisers I know used Vanguard in one form or another as part of the portfolio building blocks - investment management is commoditised so they don't tend to put it front and centre of their offering.

I suspect it's because the robo-advisor industry is rather immature. I have never met anyone yet who has used the services of an FA/IFA and doesn't feel ripped off. There must be someone though, I admit. Between a robo-adviser and a Vanguard solution, I would choose the latter. But I do advocate self education very strongly since only then can any individual truly make the best decision. My own feeling is that the more self education one gets, the less likely anyone will choose an advisor of any description. But if they do, fine. Though I absolutely never would.

I personally only know 3 people who use an IFA and they are all more than happy with the service they receive and the value for money they feel they are getting, and wouldn't recognise your statement about "feeling ripped off"

fred246

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

BritishInvestor

fred246 said:

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

Would be good to see that. If they were investment focused product sellers I can see how it would be bad for business, but it's 2020, not the 1990s, surely we've moved on a bit since then?

[Deleted User]

BritishInvestor said:

fred246 said:

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

Would be good to see that. If they were investment focused product sellers I can see how it would be bad for business, but it's 2020, not the 1990s, surely we've moved on a bit since then?

Seems very plausible. Rebalancing within a single fund would be done by the fund manager, removing a major justification for an ongoing adviser fee.

BritishInvestor

ZingPowZing said:

BritishInvestor said:

fred246 said:

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

Would be good to see that. If they were investment focused product sellers I can see how it would be bad for business, but it's 2020, not the 1990s, surely we've moved on a bit since then?

Seems very plausible. Rebalancing within a single fund would be done by the fund manager, removing a major justification for an ongoing adviser fee.

Surely no adviser operating in 2020 uses rebalancing as an example of value add? 

Linton

fred246 said:

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

I doubt that, if they existed at all, they were UK IFAs - the money that a UK IFA receives does not depend on either the number of funds nor on the particular funds recommended.  As far as investments are concerned, charges are for advice or the work of implementation only.  Commission has been banned.

fred246

If an IFA invests 100% in Vanguard Lifestrategy 60 and then charge 1% to check up on it a customer who reads the info is likely to be unhappy. The IFA constructs a complicated portfolio to make it look too complicated to look after it yourself.

[Deleted User]

BritishInvestor said:

ZingPowZing said:

BritishInvestor said:

fred246 said:

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

Would be good to see that. If they were investment focused product sellers I can see how it would be bad for business, but it's 2020, not the 1990s, surely we've moved on a bit since then?

Seems very plausible. Rebalancing within a single fund would be done by the fund manager, removing a major justification for an ongoing adviser fee.

Surely no adviser operating in 2020 uses rebalancing as an example of value add? 

Maybe not in 2020, but certainly was a factor in 2019.
 https://forums.moneysavingexpert.com/discussion/6081146/ifa-ongoing-fee-why-pay/p1
Mind you, the financial adviser narrative is changing very rapidly; I don’t know, what DOES he tell his clients his ongoing fee is for these days?

cfw1994

fred246 said:

I was doing some research a week or so ago. I came across a discussion on single funds in an IFAs forum. The question was could you get everything you need from a single fund. They all sort of agreed you could. One of them pointed out that it would be bad for their business. They then all agreed they would never recommend single funds because it would be bad for their businesses. I wish I had bookmarked it.

If it was a week or so ago....go to your internet history, and find it.   Then share the info!