IFA and Ethical investment Return

DoneWorking

I'm struggling to find an IFA to provide an ethical investment package to safeguard my £350k funds from inflation after payment of fees

I've tried four so far

Where else can I look to find someone

I do not want any investments in fossil fuels ,arms or exploitative industries

dunstonh

Every IFA should be able to cater for your needs.  If they cannot then it means they are not an IFA.   Are you sure you have been contacting IFAs and not FAs?  (FAs and Wealth managers are less likely to be able to meet specific ethical requirements.  Although they could have a more general ESG offering).

DoneWorking

dunstonh said:

Every IFA should be able to cater for your needs.  If they cannot then it means they are not an IFA.   Are you sure you have been contacting IFAs and not FAs?  (FAs and Wealth managers are less likely to be able to meet specific ethical requirements.  Although they could have a more general ESG offering).

They were all IFAs

None of them seem able to protect my funds from inflation by providing a return in excess of 5% after all fees

Maybe my Risk Profile is too low

I have it set at mid level risk

Albermarle

They were all IFAs None of them seem able to protect my funds from inflation by providing a return in excess of 5% after all fees

No one can guarantee any level of return on any investment .

Swipe

Albermarle said:

They were all IFAs None of them seem able to protect my funds from inflation by providing a return in excess of 5% after all fees

No one can guarantee any level of return on any investment .

Especially not in ethical funds

grumiofoundation

DoneWorking said:

dunstonh said:

Every IFA should be able to cater for your needs.  If they cannot then it means they are not an IFA.   Are you sure you have been contacting IFAs and not FAs?  (FAs and Wealth managers are less likely to be able to meet specific ethical requirements.  Although they could have a more general ESG offering).

They were all IFAs

None of them seem able to protect my funds from inflation by providing a return in excess of 5% after all fees

Maybe my Risk Profile is too low

I have it set at mid level risk

As above whatever risk level you set no IFA will be able to guarantee to protect funds with 5% after fees.

Albermarle

Swipe said:

Albermarle said:

They were all IFAs None of them seem able to protect my funds from inflation by providing a return in excess of 5% after all fees

No one can guarantee any level of return on any investment .

Especially not in ethical funds

I think the 'light green' funds that just cut out armaments, tobacco etc perform OK , probably because  underneath  the bonnet, their true greenness and talk about sustainability can be a bit suspect anyway.
Darker green funds that exclude lots of things tend to have high fees .

DoneWorking

I realise that no IFA can guarantee returns but I was expecting a realistic anticipated return from them

I have emailed them just now regarding this matter

I do not want to appoint an IFA and end up being worse off than if I simply put the funds in various savings options and took the hit on inflation

Do I have any other simpler options or am I between a rock and a hard place

fwor

DoneWorking said:

or am I between a rock and a hard place

Not really - you're in the same position as everyone else. Higher anticipated returns mean higher risk.

I would really love to put my money into something that would protect against inflation, but in current conditions that's not possible and I have to accept that my stock market investments could make a loss. So I ~might~ end up worse off than if I had used savings accounts instead. It's my judgement that in my timescales that won't be the end result but... I could be wrong.

I suspect that the IFA's response will depend on the ~exact~ wording the you are using to set their terms. If you are implying that their recommendations must protect against inflation, they will all decline.

Albermarle

DoneWorking said:

I realise that no IFA can guarantee returns but I was expecting a realistic anticipated return from them

I have emailed them just now regarding this matter

I do not want to appoint an IFA and end up being worse off than if I simply put the funds in various savings options and took the hit on inflation

Do I have any other simpler options or am I between a rock and a hard place

You can save at say 1.5% , capital guaranteed safe .

You can invest in higher risk , 100% equity . Return over short term ( < 5 years ) could be well above inflation or 40% below it
You can invest in medium risk 60/40 type  . Return over short term could be around inflation or 25% below it .

The longer you keep invested the more likely to see a positive return and less likely to see a negative return. After 10 years the odds should have swung heavily in your favour .

dunstonh

They were all IFAs
None of them seem able to protect my funds from inflation by providing a return in excess of 5% after all fees

Right. So, the problem wasn't that they didnt offer Ethical investments but they wouldn't guarantee a return in excess of 5%.  In which case, no IFA is going to do that.   or the IFAs are interpreting it as being a requirement.

I do not want to appoint an IFA and end up being worse off than if I simply put the funds in various savings options and took the hit on inflationIt is highly unlikely that scenario would be the case.  However, investment returns zig zag.  Some years will be negative.  Most are usually positive but you have to average out the ups and downs.   And expectation would be that it exceeds inflation over the long term.

For example, a medium risk portfolio that has returned in excess of 6% a year over the last 25 years would be down around 10-15% year to date.