IFA Fees....

robatwork

IanManc said:

And no, they can't charge what they like. They are in a competitive market, like anyone in financial services, and people shop around, based on price and quality of service. That's how markets work.

This is actually an interesting point. How do you shop around for an IFA with good quality of service with a competitive price?

After all, we can't just look at price because one IFA's recommendations may make a difference of tens of thousands over 10 years so perhaps expensive is better?

We can't look at past performance because as IFAs tell us, past performance is no guarantee of future performance. 

No IFA stands by his advice to an extent they will guarantee you a return. They can't.

Note I'm not saying IFAs are charlatans - their offering is clear and open, and they can certainly help save/make people money. Some people doubtless benefit hugely from their advice, and I personally welcome their contribution on this forum as they tend to be naturally bang up to date with the latest information.

To compare them with brain surgeons is insulting to brain surgeons. Nobody in their right mind would suggest a layman does brain surgery, even after reading some forums and useful books. But I would suggest most laymen can do just that in this personal finance sector and learn more than enough to DIY.

Finally I saw a comment about Aviva - their pension fund choice doesn't just focus on Gilts and Bonds, there are loads of Equities and tracker funds available. 

csgohan4

robatwork said:

IanManc said:

And no, they can't charge what they like. They are in a competitive market, like anyone in financial services, and people shop around, based on price and quality of service. That's how markets work.

This is actually an interesting point. How do you shop around for an IFA with good quality of service with a competitive price?

After all, we can't just look at price because one IFA's recommendations may make a difference of tens of thousands over 10 years so perhaps expensive is better?

We can't look at past performance because as IFAs tell us, past performance is no guarantee of future performance. 

No IFA stands by his advice to an extent they will guarantee you a return. They can't.

Note I'm not saying IFAs are charlatans - their offering is clear and open, and they can certainly help save/make people money. Some people doubtless benefit hugely from their advice, and I personally welcome their contribution on this forum as they tend to be naturally bang up to date with the latest information.

To compare them with brain surgeons is insulting to brain surgeons. Nobody in their right mind would suggest a layman does brain surgery, even after reading some forums and useful books. But I would suggest most laymen can do just that in this personal finance sector and learn more than enough to DIY.

Finally I saw a comment about Aviva - their pension fund choice doesn't just focus on Gilts and Bonds, there are loads of Equities and tracker funds available. 

Choosing an IFA, like choosing any service provider, through google local, word of mouth, unbiases e.t.c. Personal experience of prev IFA e.t.c 

Problem with keeping your choices limited to Aviva's fund house, like only sticking with Vanguards choice of funds. Whereas if you have full access to most funds available in the UK.  Again personal preference. 

robatwork

IanManc said:

I'm afraid you've lost me with the brain surgeon bit.  🤔

I don't trust anyone's judgement in financial matters! Not even my own

Sorry I wasn't attributing the brain surgeon to you - the post below yours compared IFAs and brain surgeons....

robatwork

csgohan4 said:

Choosing an IFA, like choosing any service provider, through google local, word of mouth, unbiases e.t.c. Personal experience of prev IFA e.t.c 

I still maintain it's different. A good mechanic is a good mechanic as he's repeating a very repeatable process. A good tiler is a good tiler for the same reasons - repeatable skills, attention to detail, pedantic, hard working etc. 

An IFA can be all those things and still make shocking recommendations. (Shocking from the view of hindsight).

Not IFAs but 2 of the most respected/google/word of mouth/review/S&P rating names in financial history are Equitable Life and Neil Woodford. I bought into both, the former on the recommendation of an IFA. In hindsight, both shocking.

csgohan4

robatwork said:

csgohan4 said:

Choosing an IFA, like choosing any service provider, through google local, word of mouth, unbiases e.t.c. Personal experience of prev IFA e.t.c 

I still maintain it's different. A good mechanic is a good mechanic as he's repeating a very repeatable process. A good tiler is a good tiler for the same reasons - repeatable skills, attention to detail, pedantic, hard working etc. 

An IFA can be all those things and still make shocking recommendations. (Shocking from the view of hindsight).

Not IFAs but 2 of the most respected/google/word of mouth/review/S&P rating names in financial history are Equitable Life and Neil Woodford. I bought into both, the former on the recommendation of an IFA. In hindsight, both shocking.

No IFA is going to be risk free, neither are DIY choices either, same with mechanics and other service providers. 

However for those who have done no research or prefer hands off approach, an IFA seems to be a reasonable choice, short of just randomly choosing on on Morning star top 10 picks which is equally  can be bad

Langtang

robatwork said:

To compare them with brain surgeons is insulting to brain surgeons. Nobody in their right mind would suggest a layman does brain surgery, even after reading some forums and useful books. But I would suggest most laymen can do just that in this personal finance sector and learn more than enough to DIY.

Quite. I chose the wrong profession to use in my example, but I was going for effect. We could use a car mechanic as a better example (although I saw a documentary about brain surgeons recently, and one surgeon sees himself as a body mechanic to help relieve the stress of the job)

Ibrahim5

I think it's important for balance. The forum has resident IFAs who will always tell you how marvellous they all are. It's hilarious how they all have to thank the same posts. Many people have had poor experiences with IFAs and don't think too highly of them. They should have an opportunity to voice their opinions. If people hadn't been treated so badly they wouldn't hold the opinions that they now do.

Cus

Ibrahim5 said:

I think it's important for balance. The forum has resident IFAs who will always tell you how marvellous they all are. It's hilarious how they all have to thank the same posts. Many people have had poor experiences with IFAs and don't think too highly of them. They should have an opportunity to voice their opinions. If people hadn't been treated so badly they wouldn't hold the opinions that they now do.

What happened to you?

Ibrahim5

I don't really want to go through it all again. I am just a great observer of people and behaviours. You only have to read this thread. I have got a pension I want transferring and looking after. The important part of a pension can easily be looked at on one side of A4 paper. There will be pages of waffle but the IFA won't read that. To give advice they will have to ask a few standard questions. Transferring a pension is done online in a few minutes. £5K for that? It's a joke. An annual review should be a few seconds glancing at the investments. £1820 for that! They really are spivs. They only do anything that provides silly money. Say you are 25 years old, earn £30K and want to start a pension. You should be able to go to an IFA and they set it up for less than £200. It's only a few questions and a few forms to fill in. They won't go near anything like that. Commission used to be a massive racket that they were involved in. The regulators have reduced most of the scams they were involved in. Now the scam is just silly fees. They are TOTALLY out of proportion to the service provided.

Albermarle

The forum has resident IFAs who will always tell you how marvellous they all are.

In fact there are only three as far as I know , and only one who posts regularly .

On the other hand there are about six or seven hard core IFA haters .