How do you find a trustworthy IFA?

zagfles

lisyloo said:

I don’t have any axe to grind over what other people choose to do, but just a few observations I’ve made over my lifetime

. some people will have genuine difficulty understanding the books, it’s best to just accept them as they are
. When people are dis-inclined to do things they don’t like they can put them off indefinitely
. doing nothing is often the worst thing you can do
. Life’s too short to spend doing things you don’t like doing and probably won’t do well

When it comes down to it, you have to make a decision regardless of which way you go. Whether that decision is which IFA to use, which robo adviser to use, or which multi-asset fund to use etc. As seen here there's massive variation in the quality of advice and costs of using IFAs, so the decision on which IFA to use is just as hard if not harder than eg which multi-asset fund to use.

Personal recommendation is probably not a good way, I've made that mistake with builders, you're relying on one individual's experience. Someone I know mentioned they were thinking of using an IFA that their friend recommended, I did a quick check on the FO site https://www.financial-ombudsman.org.uk/decisions-case-studies/ombudsman-decisions and found they had a dozen or so upheld complaints for stuff like Cape Verde investments etc! Others may have a clean record but use investments that are overpriced, where the customer ends up paying over 2% pa total in charges! Seen plenty of examples of that here.

xylophone

https://shaunhartcfp.co.uk/understanding-qualification-levels/

may be of interest.

You could try

https://adviserbook.co.uk/

You would tick "confirmed independent" and such other specialisms etc as required.

You would then need to ring round to discuss fees/service offered etc.

[Deleted User]

lisyloo said:

I don’t have any axe to grind over what other people choose to do, but just a few observations I’ve made over my lifetime

. some people will have genuine difficulty understanding the books, it’s best to just accept them as they are
. When people are dis-inclined to do things they don’t like they can put them off indefinitely
. doing nothing is often the worst thing you can do
. Life’s too short to spend doing things you don’t like doing and probably won’t do well

- if one can’t read and or count then you are quite right.  Get someone else to invest on your behalf.  You have no choice but to trust a stranger with your life savings. 

- Once IKEA furniture is assembled, it requires zero of your time. Reassembling it  again and again would be counterproductive. Leave it alone. 

- Today actual  investing is as simple as buying the whole world in a single fund and just adding to it.  One still needs to read a couple of books to understand what is going on. Running out of money in old age for both yourself and your loved ones is sufficiently unpleasant.  Worth investing a couple of hours when one is young to prevent it from happening. 

Albermarle

if one can’t read and or count then you are quite right.  Get someone else to invest on your behalf.  You have no choice but to trust a stranger with your life savings. 

I know friends who can read and count and have held down decent middle management jobs , but they seem unable/unwilling  to get their heads around investing and associated subjects like pensions. Other posters have said the same about friends and colleagues.

One friend in particular , I regularly provided advice/guidance/ pointers etc . He took some notice but only at a superficial level and missed many opportunities . The whole subject stressed him, and he breathed a sigh of relief when he became an IFA customer and regularly sings their praises.

All the points you make are valid about the ease of investing nowadays but to use an old saying ' you can take a horse to water but you can't make it drink' 

lisyloo

>>Running out of money in old age for both yourself and your loved ones is sufficiently unpleasant.  Worth investing a couple of hours when one is young to prevent it from happening. 

I 100% agree, but like albermarle I know lots of people who’ve turned down “free money” from their employers for years.
similarly there are thousands of people who don’t get wills done when it’s free or didn’t do EPA when it was free.
there is no doubt that this phenomena not only exists but is widespread.

if people don’t want to do something the capacity to put it off is infinite despite what a good idea it is.

I’d even go as far as saying I’ve bought a whole house with the free money whilst they’ve been procrastinating.

[Deleted User]

Of course. Free country.  People can do whatever they like with their money.  Could be worse than paying for handholding or routine pension investments.  The fact Nigerian princes keep calling suggests that someone buys their services. 

Ibrahim5

In the old days the IFAs would find you and get you to sign up to a pension. They would fill out a form and get you to sign it. That would earn them hundreds of pounds in commission and would provide ongoing income for many years without them needing to do anything at all. Now the scam is 'ongoing fees' so they have to find people who already have a large amount invested and charge them thousands of pounds for reviewing the pension. A process that only takes a few minutes. So if you phone an IFA wanting to START a pension they won't get out of bed unless you agree to pay them thousands to set it up. They don't want to know you unless you already have a few hundred thousand invested. I assume this is the problem for the OP.

lisyloo

My ifa is nothing like this at all.
we are currently talking to him about the best way to deal with drawdown for tax planning, Lta, Tfls.
he also advises us on state pension (which he won’t get any money for).
we are also discussing our plans for ltd company e.g. mvl option or divs, cgt etc.
also estate planning in the mix.

yes at the simple end you can pick some of it by reading a few books.
then you have to keep on top of the latest legislation and whatever hmrc “takes a dim view of” (not sure there is a book for that).

we have good jobs and are intelligent people but i don’t think we could replace our accountants, ifa etc. they’ve given us good advice.

i have no issue with different views and approaches and I hope the debate is useful for the OP, however what you guys are taking about - someone creaming off the top to set up a few funds is a million miles away from the service I am currently getting.

yes I agree, these days it isn’t worth paying  someone just to do a portfoilo.

Ibrahim5

An IFA is probably useful for those who struggle with arithmetic.

lisyloo

I agree and there are still some of those people around who through no fault of their own had a poor education and had to leave school at 14 before the internet with little opportunity to improve themselves and also some who would struggle to read the books.
some have good family members to help, some have none and some have bad family members to help themselves.