IFA Fees again

nikal

I have a reasonable DB pension and I will take my full state pension this Summer and I also have a DC fund around £300K sitting with the provider which is doing (more than)OK however I would like to move it into SIPP  that will allow drawdown just for occasional holidays etc. as I can't draw down from my existing fund. 
I do not need any advice on any other matter my such as DB pension, Inheritance tax, Financial planning just the DC fund which platform and then which funds and I will pay for that advice. My DC fund took 15 years to build up and during that time I had no advisor I just monitored it every few months and it's done OK in a medium risk managed fund at 0.75% fees  pa total fee. As I see it I'm paying a professional to make the platform and fund choice but what is she actually going to do for the ongoing additional fee of 0.6% pa. As I see it I'm paying the platform and chosen fund manager to "manage" my nest egg the IFA surely doesn't get involved in any decisions just monitoring the pension. What do I get for my £150 a month she will not have time to look at my portfolio every month with a few hundred clients on the books she have to do 100 hours a week.
I don't want this to go off line but what added value will I get by paying her for ongoing fees when it is just a monitoring role and she should have used her skills to choose a "good" platform in the first place.

AlanP_2

If you have managed it with Provider A for 15 years why not do the same with Provider B?

In other words, why do you need an IFA at all?

Linton

The 3 main things I would hope for from ongoing maintenance is:
1) an annual meeting to review your current situation, requirements, tax changes  etc and discuss any resulting modifications to your portfolio or wider financial strategy.
2) Pro-active response to any crash or major economic change, even if it's only to tell you not to worry.
3) Quick response to any question or concerns you have during the year

I would also see the charge as a retainer to ensure that you remain on the IFA's books.  The alternative if something significant happens in say 5 years time and you need help is that the IFA may not be available so you have to find a new one and/or will need to redo the fact find from scratch to understand your then current situation.

Albermarle

As I see it I'm paying the platform and chosen fund manager to "manage" my nest egg the IFA surely doesn't get involved in any decisions just monitoring the pension

The platform does not manage anything, they are simply an administrator. 

Something the IFA can manage is your withdrawal mechanism. If you DIY, you need to have varying levels of input depending on what you are doing and who with. Plus it should be done with tax efficiency in mind, and not having to have too much contact with HMRC.

I am not sure you need an IFA, but just be clear, decumulation of a pension pot is a bit more complicated/time consuming than accumulation .

dunstonh

I do not need any advice on any other matter my such as DB pension, Inheritance tax, Financial planning just the DC fund which platform and then which funds and I will pay for that advice.

IFAs primary role is the planning and suitability.   If you don't want any of that, then why are you wanting to use an IFA?

Also, if you don't plan to keep the IFA on to run the portfolio, then the IFA is likely to use a simple multi-asset fund instead.   Mainly for regulatory reasons.     The regulator frowns on portfolios being built and no ongoing servicing given to maintain them unless you have the knowledge and ability to DIY.  In which case, it comes back to the question why would you then need an IFA?

 What do I get for my £150 a month she will not have time to look at my portfolio every month with a few hundred clients on the books she have to do 100 hours a week.

She wont have hundreds of clients running bespoke portfolios.  The IFA will use the same portfolio for each client covering a range of risk profiles (and potentially timescale).  i.e. maybe 25 portfolios which get reviewed centrally and then applied to each investor.

As I see it I'm paying the platform and chosen fund manager to "manage" my nest egg the IFA surely doesn't get involved in any decisions just monitoring the pension

The platform is just the administrator and takes instructions from you or the adviser.  The fund manager implements the investment within that fund.  However, the IFA is in control of the weightings for countries/regions and the funds that meet that.

I don't want this to go off line but what added value will I get by paying her for ongoing fees when it is just a monitoring role and she should have used her skills to choose a "good" platform in the first place.

If it is just monitoring and not advising changes or rebalancing and you are not using any of the planning side, then there is little value and you don't need the ongoing servicing.

nikal

Many thanks for the replies. The idea of using an IFA was to use their skill set to choose the "best" platform and fund. As for drawdown I will take a lump at commencement and it will probably be a few years before I drawdown again. I will keep my total income pa below the higher tax bracket however if I go over by a few hundred pounds into the 40% bracket do I not get back my tax back on my charity donations? The point that concerned me was that my IFA has nearly 200 clients so she cannot look at everyone's portfolio every month and spend and hour and a half on each client there are not enough hours to do that. The point I didn't realise (or consider) was that an IFA could use the same platform for a number of clients making it a lot simpler for managing.

Linton

There is no such thing as the "best" platform.  All the mainstream ones are similar with small differences in cost compared with your pot size and relatively small differences in levels of service.  Whichever you choose would only make a marginal difference to the outcome, all could do the job adequately enough.

Again there is no such thing as the "best" fund.  Once you have an appropriate investment strategy and know what type of investments you need choosing a specific fund is a secondary issue.  As long as you only consider a well diversified portfolio comprised of mainstream  fund(s) the choice won't be life-changing.

So if your needs are purely the choice of a platform and a set of funds and you are comfortable with all other aspects of the management of retirement finances then using an IFA would be pointless.

Pipthecat

just the DC fund which platform and then which funds and I will pay for that advice. 

You cant go far wrong with any of the major low cost platforms.  What advice do you think you need?  What would you ask the IFA, are you looking to de-risk, or just find a new home for your current fund choices?

Albermarle

The idea of using an IFA was to use their skill set to choose the "best" platform and fund

It is a common misconception that IFA's are only there to pick investments. This is only part of the services they offer, possibly the simplest part.

Paying an IFA to do that and not much else is a waste. Maybe it would work if you could get a cheap one off review.

In this case there are some 'stripped down ' advisor services available, that just concentrate on investment portfolio advice, over the phone/web. A couple of platforms do something similar ( HL & Fidelity) and you can try googling . Some will not be independent though.

wjr4

If she has too many clients, maybe find one who doesn’t have as many