Relationship With Your IFA

Diplodicus

Ibrahim5 said:

One problem is that the fees are taken out of the pot. They should make you take the fees out of a cashpoint and take the notes in a suitcase to the IFA. People might then realize how much it is costing them.

No need for that. With the limit for contactless payment going up to £100, GSP could just stroll to the office once a week; one tap and it's done.

DT2001

Ibrahim5 said:

One problem is that the fees are taken out of the pot. They should make you take the fees out of a cashpoint and take the notes in a suitcase to the IFA. People might then realize how much it is costing them.

If they come out of your pension pot they are from your gross not net pot, potentially saving 40%.

Considering you get an annual statement of fees directly from the platforms you do know

[Deleted User]

DT2001 said:

Ibrahim5 said:

One problem is that the fees are taken out of the pot. They should make you take the fees out of a cashpoint and take the notes in a suitcase to the IFA. People might then realize how much it is costing them.

If they come out of your pension pot they are from your gross not net pot, potentially saving 40%.

Considering you get an annual statement of fees directly from the platforms you do know

Agreed. People have access to the information. Whether they appreciate the impact and how easy it would be to avoid these costs is another matter.  

Wonder if its mostly the older people who use IFAs. Inertia/habit. 

dunstonh

Taking fees via the pension is more tax efficient than paying fees directly.  However, the individual can choose to pay directly if they prefer.

GSP

Hi dunstonh, you don’t obviously have to answer these.
From your position and experience, I can imagine looking after a multitude of numbers that not one IFA has never made an error of sorts, they wouldn’t be human!
That’s why I don’t mind checking things where I can in my very limited list of skills, but I wasn’t bad ‘looking after numbers’ and could see often quite quickly when things did not look right.

I just think that if someone can cast an eye over someone else’s work, it’s not a bad thing as at some point that person being human will make a mistake on their own, that comes from my own experience of 35 years in the field.

I suppose it depends on the error. What would you find ‘acceptable’ as an error, but I suppose it also depends how that error translates into pounds, shillings and pence.

What makes an IFA better than the rest?

dunstonh

From your position and experience, I can imagine looking after a multitude of numbers that not one IFA has never made an error of sorts, they wouldn’t be human!

Anything that involves humans can result in errors occurring.   It happens to everyone.   Typos on reports are probably the most common.  Especially when you are writing it and get phone calls or walk-ins interrupting you and then going back to it.  I try to take a break after each report to refresh (often with a cuppa and coming on here).  Transaction faults should be rare.  

I just think that if someone can cast an eye over someone else’s work, it’s not a bad thing as at some point that person being human will make a mistake on their own, that comes from my own experience of 35 years in the field.

A typical adviser file can contain 500 or more pages of pdf on file for one piece of advice.  Some of the less important pages will be read at speed.  So, even the best checker in the world could miss something.   Also, checking files is notoriously tedious.   I send sample files for checking by third parties for compliance purposes (as do most advisers).   Sometimes, the checker will come back saying it's not suitable or unclear saying something is missing from the file or within the text of the report.   Yet it is there but the checker missed it.   I would hate to be doing their job.

I suppose it depends on the error. What would you find ‘acceptable’ as an error, but I suppose it also depends how that error translates into pounds, shillings and pence.

It's not the error as such but it's how errors are resolved and attempt to ensure they don't happen again and the frequency of errors that is more important.    Errors are going to happen from time to time but it's rare that one individual would find repeated errors.   If you start finding you are a victim of frequent errors then you do need to consider what is going on.

What makes an IFA better than the rest?

Whether it's an IFA or anybody else doesn't matter.   It's a personality and workplace culture issue that would be similar in any profession.     I don't think IFAs are any better or worse than others.   Although the more automated and less personalised things are, the less scope there is for administration errors.    But then the less suitable the advice is likely to be as flowchart style/AI advice tends to be wrong in a higher proportion of cases than personalised advice.

GSP

dunstonh said:

From your position and experience, I can imagine looking after a multitude of numbers that not one IFA has never made an error of sorts, they wouldn’t be human!

Anything that involves humans can result in errors occurring.   It happens to everyone.   Typos on reports are probably the most common.  Especially when you are writing it and get phone calls or walk-ins interrupting you and then going back to it.  I try to take a break after each report to refresh (often with a cuppa and coming on here).  Transaction faults should be rare.  

I just think that if someone can cast an eye over someone else’s work, it’s not a bad thing as at some point that person being human will make a mistake on their own, that comes from my own experience of 35 years in the field.

A typical adviser file can contain 500 or more pages of pdf on file for one piece of advice.  Some of the less important pages will be read at speed.  So, even the best checker in the world could miss something.   Also, checking files is notoriously tedious.   I send sample files for checking by third parties for compliance purposes (as do most advisers).   Sometimes, the checker will come back saying it's not suitable or unclear saying something is missing from the file or within the text of the report.   Yet it is there but the checker missed it.   I would hate to be doing their job.

I suppose it depends on the error. What would you find ‘acceptable’ as an error, but I suppose it also depends how that error translates into pounds, shillings and pence.

It's not the error as such but it's how errors are resolved and attempt to ensure they don't happen again and the frequency of errors that is more important.    Errors are going to happen from time to time but it's rare that one individual would find repeated errors.   If you start finding you are a victim of frequent errors then you do need to consider what is going on.

What makes an IFA better than the rest?

Whether it's an IFA or anybody else doesn't matter.   It's a personality and workplace culture issue that would be similar in any profession.     I don't think IFAs are any better or worse than others.   Although the more automated and less personalised things are, the less scope there is for administration errors.    But then the less suitable the advice is likely to be as flowchart style/AI advice tends to be wrong in a higher proportion of cases than personalised advice.

Thank you very much for all your honest replies dunstonh.

In four years I would say my IFA has done a couple of errors. Moneywise it’s hard to tell as depending how the market performed he could have lost me a little money, but might have saved some losses too!
The platform provider too has made a couple of errors, cosmetic on one but should have shifted a chunk of money from pre to post retirement after a tax free withdrawal.

While the last of the above errors was being resolved, I did use words like ‘need sharpening up’ and believe my IFA took that on board as well as the platform provider. In the past two years things appear to have run as they should, I have not had to question anything.
Maybe because I raised certain things in the past my IFA is aware I am looking at everything pretty closely.

Again, I think if you can its worth checking things quite regularly, why not it’s my money but on the whole I am still happy to pay an IFA, they have much more time, market knowledge and are exposed to financials every day.

Hudsonbutler

As above,  I'm quite happy to pay an IFA to do the job I can't. But then I'm handy at diy around my home, so I save a lot on the more practical side of life. Swings and roundabouts. 

Ibrahim5

IFAs have no practical skills. If you are able to read and write you can teach yourself. There are so many resources available now. As with many things in life self confidence seems to be the most important factor. You have to remember that IFAs purposefully make complex investment portfolios to make you think that you couldn't do it yourself. I do all the practical stuff too. No reason why you can't do both.

GSP

Ibrahim5 said:

IFAs have no practical skills. If you are able to read and write you can teach yourself. There are so many resources available now. As with many things in life self confidence seems to be the most important factor. You have to remember that IFAs purposefully make complex investment portfolios to make you think that you couldn't do it yourself. I do all the practical stuff too. No reason why you can't do both.

Not sure if I agree Ibrahim5 and not sure if it’s about confidence etc. It’s about leaving matters to a specialist who has to look at just about everything daily for his job, I for one just wouldn’t have the time. With a number of clients under their belts, I am sure they often make similar decisions on fund recommendations from time to time. In truth just being aware how the overall markets are day to day is enough for me and how this may affect my fund.
Do they really make complex investment portfolio’s to make you think you can’t do it yourself? I thought the key was diversity and not putting all your eggs in one basket?