Pensionbee decimates my pension pot.

Marcon

Deleted_User said:

LV_426 said:

Deleted_User said:

TadleyBaggie said:

bostonerimus said:
This whole thread is an excellent argument for annuities...

...for people who don't understand investments and are too tight to afford to pay an IFA for on going advice. Which is why I don't begrudge my IFA for 0.5% annual fee, he makes way better choices than I ever could.

How do you know its good advice? Would you begrudge generously paying for bad investment advice? 

Here's how I judge my financial adviser: I start by approaching someone through a trusted recommendation. I then listen to what they say in their 'sales pitch'. I do my own research so I'm in a better position to judge what they are telling me. Then I make a decision on whether they can reliably advise me.
Fortunately I managed to find someone who fulfils my expectation. His initial recommendation was to do nothing with my investments currently. I respect his honesty, and will definitely ask for, and pay for his advice in the future.

That’s great but if you did “your own research” then surely you already know that “do nothing” is the right approach?  Not a very complex concept, right?  

Here is the problem… Ongoing investment advice is only worth paying for if you know nothing and the advisor is good. And neither is assured.  And to properly evaluate advice so that you can reasonably act on it, you need to learn about investments. Because its your money and your family’s financial security and the interests are not aligned. 

How about those of us who know plenty, including the fact that their IFA can do a better job than they can? Entirely agree the adviser needs to be good.

LV_426

Deleted_User said:

LV_426 said:

Deleted_User said:

TadleyBaggie said:

bostonerimus said:
This whole thread is an excellent argument for annuities...

...for people who don't understand investments and are too tight to afford to pay an IFA for on going advice. Which is why I don't begrudge my IFA for 0.5% annual fee, he makes way better choices than I ever could.

How do you know its good advice? Would you begrudge generously paying for bad investment advice? 

Here's how I judge my financial adviser: I start by approaching someone through a trusted recommendation. I then listen to what they say in their 'sales pitch'. I do my own research so I'm in a better position to judge what they are telling me. Then I make a decision on whether they can reliably advise me.
Fortunately I managed to find someone who fulfils my expectation. His initial recommendation was to do nothing with my investments currently. I respect his honesty, and will definitely ask for, and pay for his advice in the future.

That’s great but if you did “your own research” then surely you already know that “do nothing” is the right approach?  Not a very complex concept, right?  

Here is the problem… Ongoing investment advice is only worth paying for if you know nothing and the advisor is good. And neither is assured.  And to properly evaluate advice so that you can reasonably act on it, you need to learn about investments. Because its your money and your family’s financial security and the interests are not aligned. 

By research I mean, becoming familiar with the terminology, processes etc, so I at least understand the language.

It may seem like he did little to come to the conclusion of 'do nothing', but that was far from the case. He approached all my pension providers to get information, and wrote a couple of lengthy emails to me, outlining his assessment, and the status of each pension plan. Plus a few recommendations.

A lot of what he told me, I already knew, but I got some useful nuggets of information and advice that I didn't know. Of course the quality of any financial adviser is not assured, but after everything he'd said, I had some degree of confidence that I was receiving good advice. And he didn't ask for any payment, which I guess is what most IFAs do initially to attract customers.
However the amount of time and effort he put into the initial consultation I felt was impressive.

[Deleted User]

Marcon said:

Deleted_User said:

LV_426 said:

Deleted_User said:

TadleyBaggie said:

bostonerimus said:
This whole thread is an excellent argument for annuities...

...for people who don't understand investments and are too tight to afford to pay an IFA for on going advice. Which is why I don't begrudge my IFA for 0.5% annual fee, he makes way better choices than I ever could.

How do you know its good advice? Would you begrudge generously paying for bad investment advice? 

Here's how I judge my financial adviser: I start by approaching someone through a trusted recommendation. I then listen to what they say in their 'sales pitch'. I do my own research so I'm in a better position to judge what they are telling me. Then I make a decision on whether they can reliably advise me.
Fortunately I managed to find someone who fulfils my expectation. His initial recommendation was to do nothing with my investments currently. I respect his honesty, and will definitely ask for, and pay for his advice in the future.

That’s great but if you did “your own research” then surely you already know that “do nothing” is the right approach?  Not a very complex concept, right?  

Here is the problem… Ongoing investment advice is only worth paying for if you know nothing and the advisor is good. And neither is assured.  And to properly evaluate advice so that you can reasonably act on it, you need to learn about investments. Because its your money and your family’s financial security and the interests are not aligned. 

How about those of us who know plenty, including the fact that their IFA can do a better job than they can? Entirely agree the adviser needs to be good.

The adviser can do a better job than you at doing nothing on an ongoing basis?  That’s awesome. Well worth paying for. 

bostonerimus

LV_426 said:

Deleted_User said:

LV_426 said:

Deleted_User said:

TadleyBaggie said:

bostonerimus said:
This whole thread is an excellent argument for annuities...

...for people who don't understand investments and are too tight to afford to pay an IFA for on going advice. Which is why I don't begrudge my IFA for 0.5% annual fee, he makes way better choices than I ever could.

How do you know its good advice? Would you begrudge generously paying for bad investment advice? 

Here's how I judge my financial adviser: I start by approaching someone through a trusted recommendation. I then listen to what they say in their 'sales pitch'. I do my own research so I'm in a better position to judge what they are telling me. Then I make a decision on whether they can reliably advise me.
Fortunately I managed to find someone who fulfils my expectation. His initial recommendation was to do nothing with my investments currently. I respect his honesty, and will definitely ask for, and pay for his advice in the future.

That’s great but if you did “your own research” then surely you already know that “do nothing” is the right approach?  Not a very complex concept, right?  

Here is the problem… Ongoing investment advice is only worth paying for if you know nothing and the advisor is good. And neither is assured.  And to properly evaluate advice so that you can reasonably act on it, you need to learn about investments. Because its your money and your family’s financial security and the interests are not aligned. 

By research I mean, becoming familiar with the terminology, processes etc, so I at least understand the language.

It may seem like he did little to come to the conclusion of 'do nothing', but that was far from the case. He approached all my pension providers to get information, and wrote a couple of lengthy emails to me, outlining his assessment, and the status of each pension plan. Plus a few recommendations.

A lot of what he told me, I already knew, but I got some useful nuggets of information and advice that I didn't know. Of course the quality of any financial adviser is not assured, but after everything he'd said, I had some degree of confidence that I was receiving good advice. And he didn't ask for any payment, which I guess is what most IFAs do initially to attract customers.
However the amount of time and effort he put into the initial consultation I felt was impressive.

People make investing harder than it needs to be. Get your asset allocation right and sit back! I haven't done anything with my index tracker portfolio since 2014 - when I retired. My ongoing plan is to sit on my hands.

LV_426

bostonerimus said:

LV_426 said:

Deleted_User said:

LV_426 said:

Deleted_User said:

TadleyBaggie said:

bostonerimus said:
This whole thread is an excellent argument for annuities...

...for people who don't understand investments and are too tight to afford to pay an IFA for on going advice. Which is why I don't begrudge my IFA for 0.5% annual fee, he makes way better choices than I ever could.

How do you know its good advice? Would you begrudge generously paying for bad investment advice? 

Here's how I judge my financial adviser: I start by approaching someone through a trusted recommendation. I then listen to what they say in their 'sales pitch'. I do my own research so I'm in a better position to judge what they are telling me. Then I make a decision on whether they can reliably advise me.
Fortunately I managed to find someone who fulfils my expectation. His initial recommendation was to do nothing with my investments currently. I respect his honesty, and will definitely ask for, and pay for his advice in the future.

That’s great but if you did “your own research” then surely you already know that “do nothing” is the right approach?  Not a very complex concept, right?  

Here is the problem… Ongoing investment advice is only worth paying for if you know nothing and the advisor is good. And neither is assured.  And to properly evaluate advice so that you can reasonably act on it, you need to learn about investments. Because its your money and your family’s financial security and the interests are not aligned. 

By research I mean, becoming familiar with the terminology, processes etc, so I at least understand the language.

It may seem like he did little to come to the conclusion of 'do nothing', but that was far from the case. He approached all my pension providers to get information, and wrote a couple of lengthy emails to me, outlining his assessment, and the status of each pension plan. Plus a few recommendations.

A lot of what he told me, I already knew, but I got some useful nuggets of information and advice that I didn't know. Of course the quality of any financial adviser is not assured, but after everything he'd said, I had some degree of confidence that I was receiving good advice. And he didn't ask for any payment, which I guess is what most IFAs do initially to attract customers.
However the amount of time and effort he put into the initial consultation I felt was impressive.

People make investing harder than it needs to be. Get your asset allocation right and sit back! I haven't done anything with my index tracker portfolio since 2014 - when I retired. My ongoing plan is to sit on my hands.

Fair enough. I just wanted to get some reassurance. Obviously a personal choice, and everyone's circumstances are unique.

[Deleted User]

1. There are different types of “financial advice”.  We are talking about “ongoing investment advice”.

2. Once the individual understands his risk, picks assets and investments, he should write down his strategy in the “investment policy statement” and then stick by it.  Aka “do nothing”. It beats me why anyone needs ongoing advice to stay the course but I appreciate that some people do. 

On a sidenote, it is interesting to see how “advice” industry changed the meaning of advice over the years.  Financial advisors used to pick “the best” stocks for you.  

Later on that role was taken over by mutual fund managers (who are paid more, manage more money and have better qualifications) so advisors said “we’ll pick the best fund managers for you”.

UK is a bit behind but in N America retirement investment is rapidly moving away from active to passive strategies and from mutual funds to ETFs.  So advisors pivoted again. Now they said “I’ll be your asset manager”.  They started buying passive ETFs for their clients. 

Well, the financial industry moved on to offering cheap and simple asset management tools, not requiring ongoing advice even for people who can’t manage a spreadsheet.

We’ll see what the advisors will pivot to next.  Invariably advisors have a preference for charging models involving ongoing charges and their industry seems to be very good at coming up with new models requiring such charges. But really they are just another layer. 

robatwork

LV_426 said:

Fair enough. I just wanted to get some reassurance. Obviously a personal choice, and everyone's circumstances are unique.

Yes. And no. Unique but we all want pretty much the same.

Everyone's "circumstances" is to desire a large gain with no risk of loss.  If someone could offer that then everyone's business would go to them.

Of course such a thing doesn't exist, but we're all the same in this respect. 

The secret is finding as close to this as possible, whether through learning and choosing funds/trackers/managers or paying someone who can do it better than you. Past performance is no guarantee of course whether with IFAs or fund managers (see Woodford, Leeson, Madoff et al). That's why it's better to trust yourself, then you only have yourself to blame. Investing isn't like fixing a car - there's no right and wrong way to do something. I digress. The point is you want the same from your pension fund that I do. 

bostonerimus

robatwork said:

LV_426 said:

Fair enough. I just wanted to get some reassurance. Obviously a personal choice, and everyone's circumstances are unique.

Yes. And no. Unique but we all want pretty much the same.

Everyone's "circumstances" is to desire a large gain with no risk of loss.  If someone could offer that then everyone's business would go to them.

Of course such a thing doesn't exist, but we're all the same in this respect. 

I think this is a big mistake that many people make. They should seek adequate gain for their financial goals at the lowest risk possible.

[Deleted User]

…see “efficient frontier”. 

LV_426

robatwork said:

LV_426 said:

Fair enough. I just wanted to get some reassurance. Obviously a personal choice, and everyone's circumstances are unique.

Yes. And no. Unique but we all want pretty much the same.

Everyone's "circumstances" is to desire a large gain with no risk of loss.  If someone could offer that then everyone's business would go to them.

By "circumstances" I mean your particular pension assets and investments. This is why trying to use a forum like this for specific advice is difficult, as you'd need to supply these details. And why an adviser spends time collecting such information in order to advise.

What you're meaning by "circumstances" is "goals", and we all desire something along those lines. And yes nobody can offer that, but I never said they could.