Advice on True Potential LLP Investment Service

coyrls

DoneWorking said:

coyrls said:

DoneWorking said:

dunstonh said:

A forum poster suggested I go with a Vanguard Investment

I assumed these were EFTs

A forum poster suggested I go with a Vanguard Investment

I assumed these were EFTs

I do not have current knowledge on choosing EFTs
Nor for that matter choosing OEICs or UTs
Where can I find more info on these

When they said vanguard did they mean on an advised basis or a DIY basis.

Vanguard is a fund house that offers a range of funds.  They make these available to the whole of market (so IFAs and DIY can use them).   They also offer them direct via their own restricted platform (offers only its own funds).

Vanguard also has a basic advised option that only uses the Vanguard platform and vanguard funds.  Their portfolios are bespoke to that service but are made up of Vanguard funds. i.e. you cannot buy that portfolio without the advice unless you happen to know what it is and try to recreate it.

I wouldn't worry about investment universes at this point.  Only if you DIY do you need to get into that.   If you use an advised service (IFA, FA or basic guidance) they will take care of that.

Thanks Dunstonh

I have not had a quote as yet from a FA or an advised service

If you are looking at projected returns as quotes, you are looking in the wrong place.  You should be comparing on the basis of service, relationship and fees.  I would suggest that if you choose on the basis of who offers you the best projected returns, you are almost guaranteed to make a bad choice.

I realise that projected return is not a firm figure

So I would certainly not take that into account

It's the other factors that I am most interested in.

I must have misunderstood you when you said:

IFA seems good but most I have spoken to who are at a fair cost are suggesting that after costs I would be looking at a 4% return max subject to variation depending on market conditions

As it implied that you were rejecting IFAs because of their low projected returns.  The returns they suggest would be related to the level of risk that you are prepared to take.

masonic

DoneWorking said:

IFA seems good but most I have spoken to who are at a fair cost are suggesting that after costs I would be looking at a 4% return max subject to variation depending on market conditions

Seems realistic to me, presume it is after inflation. Has this put you off? You seemed so close to a decision after your last update, would be a shame to start the search all over again.

DoneWorking

coyrls said:

DoneWorking said:

coyrls said:

DoneWorking said:

dunstonh said:

A forum poster suggested I go with a Vanguard Investment

I assumed these were EFTs

A forum poster suggested I go with a Vanguard Investment

I assumed these were EFTs

I do not have current knowledge on choosing EFTs
Nor for that matter choosing OEICs or UTs
Where can I find more info on these

When they said vanguard did they mean on an advised basis or a DIY basis.

Vanguard is a fund house that offers a range of funds.  They make these available to the whole of market (so IFAs and DIY can use them).   They also offer them direct via their own restricted platform (offers only its own funds).

Vanguard also has a basic advised option that only uses the Vanguard platform and vanguard funds.  Their portfolios are bespoke to that service but are made up of Vanguard funds. i.e. you cannot buy that portfolio without the advice unless you happen to know what it is and try to recreate it.

I wouldn't worry about investment universes at this point.  Only if you DIY do you need to get into that.   If you use an advised service (IFA, FA or basic guidance) they will take care of that.

Thanks Dunstonh

I have not had a quote as yet from a FA or an advised service

If you are looking at projected returns as quotes, you are looking in the wrong place.  You should be comparing on the basis of service, relationship and fees.  I would suggest that if you choose on the basis of who offers you the best projected returns, you are almost guaranteed to make a bad choice.

I realise that projected return is not a firm figure

So I would certainly not take that into account

It's the other factors that I am most interested in.

I must have misunderstood you when you said:

IFA seems good but most I have spoken to who are at a fair cost are suggesting that after costs I would be looking at a 4% return max subject to variation depending on market conditions

As it implied that you were rejecting IFAs because of their low projected returns.  The returns they suggest would be related to the level of risk that you are prepared to take.

I had just given that as an example 

The IFA based it on his past experience but stressed the return after fees could be less or more than 4%

DoneWorking

masonic said:

DoneWorking said:

IFA seems good but most I have spoken to who are at a fair cost are suggesting that after costs I would be looking at a 4% return max subject to variation depending on market conditions

Seems realistic to me, presume it is after inflation. Has this put you off? You seemed so close to a decision after your last update, would be a shame to start the search all over again.

He said the anticipated return  taking into account fees at my level of acceptable risk would be 4%
This would be unlikely to beat inflation currently in excess of 8%

As regards my decision I am taking a final look over options before deciding 

I must say I tend to fluctuate

My ideal scenario is for someone to listen to my requirements and to propose a basic passive or active investment arrangement

Which can be adjusted each year on going

I would pay an agreed fee for this

Fee to be agreed beforehand

The advisor could be IFA FA or even an organisation like Vanguard

Thrugelmir

DoneWorking said:

milton1970 said:

Not independent 

Expensive

Not independent and expensive 

Find a genuine IFA or do DIY

Surely many IFAs are also expensive
It takes time to source those with fair reasonable charges 

The bigger your portfolio the more reasonable the charges will seem. Employing people is very expensive. Costs need to be recouped. 

masonic

DoneWorking said:

IFA seems good but most I have spoken to who are at a fair cost are suggesting that after costs I would be looking at a 4% return max subject to variation depending on market conditions

DoneWorking said:

The IFA based it on his past experience but stressed the return after fees could be less or more than 4%

DoneWorking said:

masonic said:

DoneWorking said:

IFA seems good but most I have spoken to who are at a fair cost are suggesting that after costs I would be looking at a 4% return max subject to variation depending on market conditions

Seems realistic to me, presume it is after inflation. Has this put you off? You seemed so close to a decision after your last update, would be a shame to start the search all over again.

He said the anticipated return  taking into account fees at my level of acceptable risk would be 4%
This would be unlikely to beat inflation currently in excess of 8%

There's an appreciable difference between a real return of 4%, a nominal return of 4%, a maximum return of 4% and an average return of 4%. You should probably seek to clarify what was actually meant. My understanding is that you were going for a portfolio that was 50% equities and 50% consumer savings accounts, where the adviser would only be responsible for the equities part, so from their perspective it would be 100% equities. Has this changed?

Also, inflation over the past 12 months would be irrelevant, it has already been experienced and is in the rear view mirror. What matters more is inflation over the next decade or longer. You can say with certainty that your cash has eroded in value due to the 9%/7.8% (CPI/CPIH) inflation experienced over the past 12 months. Where the inflation measures will be between May 2022 - May 2023 and beyond is anyone's guess.

Malthusian

masonic said:

There's an appreciable difference between a real return of 4%, a nominal return of 4%, a maximum return of 4% and an average return of 4%. You should probably seek to clarify what was actually meant. My understanding is that you were going for a portfolio that was 50% equities and 50% consumer savings accounts, where the adviser would only be responsible for the equities part, so from their perspective it would be 100% equities. Has this changed?

I missed the thread where this was mentioned, but it is very unlikely that any UK regulated adviser would recommend that.

Cautious investors (and for that matter nearly everyone else) don't perceive a 40% stockmarket fall in a 50% equities / 50% consumer savings accounts as a 20% fall. They perceive it as losing 40% of their money, and sell their equities before they lose any more, to add to their 50% cash which is doing so much better.

People only take a holistic view when everything is going up.

masonic

Malthusian said:

masonic said:

There's an appreciable difference between a real return of 4%, a nominal return of 4%, a maximum return of 4% and an average return of 4%. You should probably seek to clarify what was actually meant. My understanding is that you were going for a portfolio that was 50% equities and 50% consumer savings accounts, where the adviser would only be responsible for the equities part, so from their perspective it would be 100% equities. Has this changed?

I missed the thread where this was mentioned, but it is very unlikely that any UK regulated adviser would recommend that.

Cautious investors (and for that matter nearly everyone else) don't perceive a 40% stockmarket fall in a 50% equities / 50% consumer savings accounts as a 20% fall. They perceive it as losing 40% of their money, and sell their equities before they lose any more, to add to their 50% cash which is doing so much better.

People only take a holistic view when everything is going up.

I linked the previous update by the OP, given in his previous thread on the subject earlier on this page, but here it is again: https://forums.moneysavingexpert.com/discussion/comment/79161938/#Comment_79161938

There's been a series of threads chronicling the journey to that point. The savings ladder plus global tracker portfolio seems to have been suggested in another of the OP's threads on this topic and favoured over multi-asset DIY/multi-asset advised/robo. There have been several threads running in parallel, so not always easy to follow along with the current thinking. Prior to this thread being started, it seemed the 50:50 portfolio had been decided upon and the IFA was on board, but as you can probably see, I have a question for the OP in relation to this. It is possible the IFA has only agreed to advise on the 50% of assets as if they were the only assets under consideration, so not to take the 50% cash as a bonds proxy. OP does not want to include bonds in the portfolio (discussed in another of the threads), so that would have been a non-starter I believe, and perhaps goes some way to explaining how this new thread appears to be back at square one.

DoneWorking

masonic said:

Malthusian said:

masonic said:

There's an appreciable difference between a real return of 4%, a nominal return of 4%, a maximum return of 4% and an average return of 4%. You should probably seek to clarify what was actually meant. My understanding is that you were going for a portfolio that was 50% equities and 50% consumer savings accounts, where the adviser would only be responsible for the equities part, so from their perspective it would be 100% equities. Has this changed?

I missed the thread where this was mentioned, but it is very unlikely that any UK regulated adviser would recommend that.

Cautious investors (and for that matter nearly everyone else) don't perceive a 40% stockmarket fall in a 50% equities / 50% consumer savings accounts as a 20% fall. They perceive it as losing 40% of their money, and sell their equities before they lose any more, to add to their 50% cash which is doing so much better.

People only take a holistic view when everything is going up.

I linked the previous update by the OP, given in his previous thread on the subject earlier on this page, but here it is again: https://forums.moneysavingexpert.com/discussion/comment/79161938/#Comment_79161938

There's been a series of threads chronicling the journey to that point. The savings ladder plus global tracker portfolio seems to have been suggested in another of the OP's threads on this topic and favoured over multi-asset DIY/multi-asset advised/robo. There have been several threads running in parallel, so not always easy to follow along with the current thinking. Prior to this thread being started, it seemed the 50:50 portfolio had been decided upon and the IFA was on board, but as you can probably see, I have a question for the OP in relation to this. It is possible the IFA has only agreed to advise on the 50% of assets as if they were the only assets under consideration, so not to take the 50% cash as a bonds proxy. OP does not want to include bonds in the portfolio (discussed in another of the threads), so that would have been a non-starter I believe, and perhaps goes some way to explaining how this new thread appears to be back at square one.

The IFA had based his figure of 4% based on him using 50 % of my funds

This was after costs 

"The  4% would only be on the funds held in the ESG Cautious portfolio.This isn’t guaranteed, and it could be more or less than this."

I would be using the other 50% to try and attain an overall return of about 2%

I haven't moved ahead on this as yet as I am just making some last minute checks to ensure I have covered all options before I make a final decision

masonic

DoneWorking said:

masonic said:

Malthusian said:

masonic said:

There's an appreciable difference between a real return of 4%, a nominal return of 4%, a maximum return of 4% and an average return of 4%. You should probably seek to clarify what was actually meant. My understanding is that you were going for a portfolio that was 50% equities and 50% consumer savings accounts, where the adviser would only be responsible for the equities part, so from their perspective it would be 100% equities. Has this changed?

I missed the thread where this was mentioned, but it is very unlikely that any UK regulated adviser would recommend that.

Cautious investors (and for that matter nearly everyone else) don't perceive a 40% stockmarket fall in a 50% equities / 50% consumer savings accounts as a 20% fall. They perceive it as losing 40% of their money, and sell their equities before they lose any more, to add to their 50% cash which is doing so much better.

People only take a holistic view when everything is going up.

I linked the previous update by the OP, given in his previous thread on the subject earlier on this page, but here it is again: https://forums.moneysavingexpert.com/discussion/comment/79161938/#Comment_79161938

There's been a series of threads chronicling the journey to that point. The savings ladder plus global tracker portfolio seems to have been suggested in another of the OP's threads on this topic and favoured over multi-asset DIY/multi-asset advised/robo. There have been several threads running in parallel, so not always easy to follow along with the current thinking. Prior to this thread being started, it seemed the 50:50 portfolio had been decided upon and the IFA was on board, but as you can probably see, I have a question for the OP in relation to this. It is possible the IFA has only agreed to advise on the 50% of assets as if they were the only assets under consideration, so not to take the 50% cash as a bonds proxy. OP does not want to include bonds in the portfolio (discussed in another of the threads), so that would have been a non-starter I believe, and perhaps goes some way to explaining how this new thread appears to be back at square one.

The IFA had based his figure of 4% based on him using 50 % of my funds

This was after costs 

"The  4% would only be on the funds held in the ESG Cautious portfolio.This isn’t guaranteed, and it could be more or less than this."

I would be using the other 50% to try and attain an overall return of about 2%

I haven't moved ahead on this as yet as I am just making some last minute checks to ensure I have covered all options before I make a final decision

Ok, so you are going to be super cautious overall with 50% in cash. I think the average return of 4% on the other 50% (after costs of 1.2%) sounds optimistic for a cautious portfolio! Don't expect that in the early years.