financial advisers charges

Albermarle

Now I must find a better solution, maybe just opening a saving account.

A better solution would be to get the costs down . Maybe aim for 

1% initial fee ( say max £3K)

0.5% ongoing advisor fee (

No DFM 

Fund and platform cost around 0.6% 

Notepad_Phil

cisko65 said:

Albermarle said:

cisko65 said:

Albermarle said:

Do not forget that platform and fund charges are on top .

Probably better to find a local IFA who you can actually meet face to face ( Covid allowing ) and build up a relationship with , rather than purely on line offerings . The costs would be in the same ball park .

Not sure what platform and fund charges are? Sorry

I'll talk to an online IFA next week (Fintuity). Last week, a zoom face-to-face with the Client Relationship Manager felt fine.

All the charges you listed are for managing/advising on your investments .

But the investments themselves will have a cost /% charge per year . This can vary widely from 0.1 % to 1.5%
Then you need somewhere to buy and hold the investments . This is called an investment platform and they charge as well . From 0.1% to 0.45 % approx .

If you did it all yourself then you would still have to pay the investments and platform charges but obviously not all the financial advice /DFM charges .

Thanks indeed for all this information. I realise I am still unaware of how the investment world works. Therefore making decisions on what to do and how is beyond my capability. Even with the help of an independent financial adviser. Now I must find a better solution, maybe just opening a saving account.

Short term you may be right, but longer term it's much more likely that you would be making a big mistake. Inflation over the longer term is extremely likely to significantly eat away the real value of any sum deposited in the savings accounts that you can open today, whereas suitably invested sums at least have a chance of keeping up and even beating inflation over the years and decades to come.

The only time I would say that a savings account may be better is if your money is expected to all be spent within the next 5 to 10 years.

Eco_Miser

Albermarle said:

But the investments themselves will have a cost /% charge per year . This can vary widely from 0.1 % to 1.5%
Then you need somewhere to buy and hold the investments . This is called an investment platform and they charge as well . From 0.1% to 0.45 % approx .

If you did it all yourself then you would still have to pay the investments and platform charges but obviously not all the financial advice /DFM charges .

Note that while you have to pay the platform the platform charges, the fund manager deducts their charges from the fund and all the returns quoted are after that deduction.

cisko65

Albermarle said:

Now I must find a better solution, maybe just opening a saving account.

A better solution would be to get the costs down . Maybe aim for 

1% initial fee ( say max £3K)

0.5% ongoing advisor fee (

No DFM 

Fund and platform cost around 0.6% 

Thanks, feel hopeful again. 

How would you say Fintuity's online IFA compares to the costs you listed then?

-Lump sum Investment/Transfer

Full investment planning (including review of existing planning and accounts) 1.5% (fees applied to all contributions made to the recommended plans over the first 12 months)

-Charge per annum on any amount 0.5% (monetary charges will increase as the value of investment funds increases)

-They mention Discretionary Fund Management 0.5% plus VAT of any funds invested per annum. Which I don't understand if they can ''remove'' it.

Haven't talked to them about fund and platform cost yet. I now see how vital this is. Will speak to the Financial adviser next week.

And will post in Nextdoor about local IFA.

Steve182

The investment world can be as simple or as complex as you want it to be.

My thoughts.

Small one off amount, say <£10K to invest, maybe don't bother unless you feel interested in investing. Perhaps just put it in PB's?

£10K to £250K, put it in a tax wrapper (Lisa, ISA, SIPP) in a low cost platform like AJ Bell or similar and use Vanguard LS funds for a hands off approach, or do your own research and make own choices if you want involvement.

£250K to £10M, do some serious research or use an IFA

>£10M who cares, you are not likely to run out of money .

Eco_Miser

Steve182 said:

£10K to £250K, put it in a tax wrapper (Lisa, ISA, SIPP) in a low cost platform

But note that there are annual limits for tax wrappers: £4k for LISA, £20k over all ISAs, including LISA, lower of £40k or salary for SIPP, further conditions and loopholes may apply.

jbuchanangb

I will say that I am a naïve investor, and very cautious so that when 15 years ago I had redundancy money to invest, and then 5 years ago I had inheritance money to invest, I decided to use the services of IFAs. On both occasions I found myself with S&S ISAs with a portfolio selected by the IFA after lengthy discussions about the long-term purposes for the savings/investments, and about my wife's and my attitude to risk. Most recently were also able to request an ethical portfolio. I understand that the IFA selected our portfolio from a raft of preselected portfolios which they had to suit a wide range of investor profiles. We had no objection to paying initial fees to the IFA for the expertise knowledge and care which they provided in the selection of the portfolio. Initially we even enrolled in ongoing fees to provide for annual reviews. Less than a year into our recent S&S ISAs, the IFA firm was taken over by some other outfit, who sent a different "adviser" along, who essentially rubbished the solution provided by his predecessor, and proposed we abandon it all and let him put it into Discretionary Managed Funds. We dispensed with their services, and the S&S ISAs continue to perform quite well with just the platform fees.

[Deleted User]

jbuchanangb said:

Less than a year into our recent S&S ISAs, the IFA firm was taken over by some other outfit, who sent a different "adviser" along, who essentially rubbished the solution provided by his predecessor, and proposed we abandon it all and let him put it into Discretionary Managed Funds. We dispensed with their services, and the S&S ISAs continue to perform quite well with just the platform fees.

Hi,

nothing to do with commission or kickback, of course.

Albermarle

[Deleted User] said:

jbuchanangb said:

Less than a year into our recent S&S ISAs, the IFA firm was taken over by some other outfit, who sent a different "adviser" along, who essentially rubbished the solution provided by his predecessor, and proposed we abandon it all and let him put it into Discretionary Managed Funds. We dispensed with their services, and the S&S ISAs continue to perform quite well with just the platform fees.

Hi,

nothing to do with commission or kickback, of course.

Financial advisors can not take commission ( or kickback ) for some years now . However they can suggest 'solutions' that suit their business model and maybe lock you in more tightly/higher fees.

jbuchanangb

The effect of that intervention was that whereas I had been stumping up some percentage to the IFA for "annual reviews", I immediately cancelled my relationship with them, and saved myself the expense. Now I have to say that I struggle with the concept of "annual reviews" when other received wisdom is that one should invest for a minimum of 5 years and preferably for as long as 10 years. So my S&S ISA portfolio is the same as when I invested, and has performed quite well.