Cancelling contract with financial advisor

CaptainSkeptical

Hi.  I've a contract with a financial advisor who I have used for the last 10 or so years and now come to the conclusion that it's pretty expensive for the low level of service I get.  I've read up on quite a few sites such as here and Monevator etc and feel I can now take charge of my own limited investments, which are several workplace defined contribution pensions gathered through the years and a couple of small stocks and shares ISAs and general investment accounts.  

I've checked the contract from the financial advisor and it appears there's no tie in periods nor fees associated with cancelling.

I've searched on line and although there's a few articles about how to change your financial advisor, I couldn't find much about what to do to cancel a contract with an advisor and take charge of your own affairs. 

Other than sending the financial advisor a letter / email telling them I'm cancelling my contract with them, and also cancelling the existing letters of authority with my pension companies etc that he was my advisor / intermediary for, is there anything else I need to do ?

All information gratefully received.

eskbanker

As I understand it, some financial products are only made available to consumers via advisers rather than directly to DIYers, so you'd need to establish if that's the case for any of yours.

Bostonerimus1

eskbanker said:

As I understand it, some financial products are only made available to consumers via advisers rather than directly to DIYers, so you'd need to establish if that's the case for any of yours.

Yes, before cancelling make sure you fully understand your investments and that you can access and manage them on your own from now on. Then give your advisor notice that you won't be needing their services anymore. I think it's good practice, and just plain polite, to give something like a month's notice just as you would if you were leaving a job.

dunstonh

I've checked the contract from the financial advisor and it appears there's no tie in periods nor fees associated with cancelling.

There isnt with any financial adviser apart from St James Place.

Other than sending the financial advisor a letter / email telling them I'm cancelling my contract with them, and also cancelling the existing letters of authority with my pension companies etc that he was my advisor / intermediary for, is there anything else I need to do ?

Just send an email to the adviser saying you wish to end ongoing servicing.  That is all that is needed.

You dont need to the pension companies etc as the adviser will turn off remuneration and they will verify that in writing.  

If you tell the providers to remove the adviser from the agency, you become an orphan client and some providers will increase your charges if you do that.  Plus, sometimes people go back to their adviser when they find out DIY isn't for them.    Leaving your adviser as agent turns you into a transactional client.  i.e. no ongoing remuneration being paid to the adviser but access retained should you choose to use the adviser again in the future.

CaptainSkeptical

Thanks for the points to consider.  Much appreciated.

callum9999

Bostonerimus1 said:

eskbanker said:

As I understand it, some financial products are only made available to consumers via advisers rather than directly to DIYers, so you'd need to establish if that's the case for any of yours.

Yes, before cancelling make sure you fully understand your investments and that you can access and manage them on your own from now on. Then give your advisor notice that you won't be needing their services anymore. I think it's good practice, and just plain polite, to give something like a month's notice just as you would if you were leaving a job.

I can't comment on whether it's "the done thing" or not, but suggesting that someone gives a months notice to leave something that apparently requires no notice - i.e. handing over money for a service they don't want - seems pretty ridiculous?

Unless you're suggesting they've been turning away clients to give extra attention to the OP, which I'd find hard to believe, it's absolutely nothing whatsoever like leaving a job.

Aminatidi

That's all we did when my mum ended her relationship with her IFA.

If there are online portals make sure that you have access to them and that the advisor is removed from them.

I'd hope that happens as standard.

jimjames

CaptainSkeptical said:

 I can now take charge of my own limited investments, which are several workplace defined contribution pensions gathered through the years and a couple of small stocks and shares ISAs and general investment accounts.  

One thing I'd look at addressing is the "couple of small ISAs", if those were setup by the adviser it begs the question why have several small ones when they could be consolidated into one? There might be a good reason but normally it makes more sense to have in one place if they're small. You could see a reason to split if they're hundreds of thousands but admin for multiple small pots doesn't seem worth it as well as potentially costing you more.

Albermarle

jimjames said:

CaptainSkeptical said:

 I can now take charge of my own limited investments, which are several workplace defined contribution pensions gathered through the years and a couple of small stocks and shares ISAs and general investment accounts.  

One thing I'd look at addressing is the "couple of small ISAs", if those were setup by the adviser it begs the question why have several small ones when they could be consolidated into one? There might be a good reason but normally it makes more sense to have in one place if they're small. You could see a reason to split if they're hundreds of thousands but admin for multiple small pots doesn't seem worth it as well as potentially costing you more.

Also unless ISA's are filled with the full £20K each year, why have the hassle and potential tax of having general investment accounts ?