Quilter CIA advice

truescot

I'll try to keep this brief. My wife and I took over from my late parents as Trustees of a Collective Investment Account with Quilter held in trust for my 15 year old daughter. We want to top up the account with some money left by my parents. Quilter form asks whether I want the top up added proportionally to existing assets or to switch to other assets. Is there any reason not to go for existing assets? No adviser attached to the account as the previous adviser was my parent's and the account has not changed for 15 years. 

You can probably tell I haven't had to deal with investments before and would prefer to just leave it to do it's own thing till daughter is 21 ish. It's performed very well up to now.

£12k being topped up by £6.5k

Eyeful

You state you have never dealt with investments before. So the following questions spring to mind.
1. How do you know "it has performed very well up to now"
(How do you how do you know this. What have you compared their performance  against or who told you the performance was good?
2. What are the fees & charges you are paying for these funds?
3. How long have these funds been held up to now?
4. How much experience did your parents have with investing. Why did they chose Quilter over someone else? 
5. Why did Quilter chose these funds to be held in that account & what are they?

If you want to get a quick & simple understanding of investing have a look at this video. It may help you decide what to do next.
https://www.kroijer.com/

truescot

Eyeful said:

You state you have never dealt with investments before. So the following questions spring to mind.
1. How do you know "it has performed very well up to now"
(How do you how do you know this. What have you compared their performance  against or who told you the performance was good?
2. What are the fees & charges you are paying for these funds?
3. How long have these funds been held up to now?
4. How much experience did your parents have with investing. Why did they chose Quilter over someone else? 
5. Why did Quilter chose these funds to be held in that account & what are they?

If you want to get a quick & simple understanding of investing have a look at this video. It may help you decide what to do next.
https://www.kroijer.com/

Thank you.

1.I suppose what I meant was - looking back at the statements we are personally happy that they have grown from 5k to over 12k since 2009. But no comparison made.
2. I would have to check
3. 15 years
4. Very little. Cautious approach to risk. Had multiple investments in retirement, spread across mutiple funds, but managed by an adviser with (irregular but meant to be annual) reviews. Very little if anything changed over several years. Meetings were more of a status report of various accounts.
5. No idea. I thought a CIA would have standard assets.

Feel like withdrawing the lot and putting it in fixed rate savings as I find this very anxiety provoking!

dunstonh

Quilter form asks whether I want the top up added proportionally to existing assets or to switch to other assets. Is there any reason not to go for existing assets?

Are the existing assets still suitable?   If so, yes.  If not, then no.

 No adviser attached to the account as the previous adviser was my parent's and the account has not changed for 15 years. 

If the investments are still what they were 15 years ago, then investing options and style have changed an awful lot since then.  

5. No idea. I thought a CIA would have standard assets.

Quilter is whole of market.  15 years ago, your adviser would have selected Skandia or Selestia as the investment platform as Quilter didn't exist back then.  Skandia bought Selestia and rebranded it under Skandia.   Then Old Mutual Wealth bought Skandia and rebranded it under Old Mutual Wealth.  Then Old mutual decided to exit the UK and sold off its UK business to different providers.   In the case of the platform, it was carved out, floated and rebranded under  a legacy name that hadn't been used for some time. i.e. Quilter.

The collective investment account is more commonly known generically as a general investment account (GIA).  Quilter is whole of market and that means the GIA can invest in around 30,000 different options.

Feel like withdrawing the lot and putting it in fixed rate savings as I find this very anxiety provoking!

As a trustee, if you are incapable of running the trust in the beneficiary's best interests, then you should end that role and arrange for a new trustee to be appointed.    Taking actions that are not in the beneficiary's best interest but are done because they suit you leaves you open to legal action.

If you are suffering from anxiety, then wait until you try and open up a savings account for a trust.  

truescot

dunstonh said:

Quilter form asks whether I want the top up added proportionally to existing assets or to switch to other assets. Is there any reason not to go for existing assets?

Are the existing assets still suitable?   If so, yes.  If not, then no.

 No adviser attached to the account as the previous adviser was my parent's and the account has not changed for 15 years. 

If the investments are still what they were 15 years ago, then investing options and style have changed an awful lot since then.  

5. No idea. I thought a CIA would have standard assets.

Quilter is whole of market.  15 years ago, your adviser would have selected Skandia or Selestia as the investment platform as Quilter didn't exist back then.  Skandia bought Selestia and rebranded it under Skandia.   Then Old Mutual Wealth bought Skandia and rebranded it under Old Mutual Wealth.  Then Old mutual decided to exit the UK and sold off its UK business to different providers.   In the case of the platform, it was carved out, floated and rebranded under  a legacy name that hadn't been used for some time. i.e. Quilter.

The collective investment account is more commonly known generically as a general investment account (GIA).  Quilter is whole of market and that means the GIA can invest in around 30,000 different options.

Feel like withdrawing the lot and putting it in fixed rate savings as I find this very anxiety provoking!

As a trustee, if you are incapable of running the trust in the beneficiary's best interests, then you should end that role and arrange for a new trustee to be appointed.    Taking actions that are not in the beneficiary's best interest but are done because they suit you leaves you open to legal action.

If you are suffering from anxiety, then wait until you try and open up a savings account for a trust.  

Thanks for the comments.

I naively thought that Quilters role was to identify appropriate assets and invest accordingly.

I have another GIA in trust for my son (with Brewin Dolphin) and I recently simply topped up via a Bank Transfer. I naively again thought this would be the same.

In terms of being incapable of running the trust in my daughters interests, I again naively thought that's why firms like Quilter exist. It stands to reason I want to make decisions in the best interests of my daughter rather than my own, hence seeking a bit of advice.

I have discussed this informally with a friend who is an FA and the previous FA on the account, neither of whom gave any indication that what I was proposing was ill-advised. I thought that my role would just be the same as my parents was for 20+ years (a name on an account largely managed by a trustworthy financial company) but it seems to be more complcated, so seems best if I find myself a financial adviser and talk it through with them. Thanks.

Eyeful

1. Have you watched both of the videos I suggest you look at in your 26 June post yet?
2. What is it that you find very anxiety provoking?
3. You can make investing as simply or as complex as you care to make it.
4. Those selling you the stuff tend to make it complex, in the hope you think you must use them.
5. If you are DIY and just after a simple buy & forget approach, which after charges will beat most active fund managers then, a simple
low cost passive Global Multi Asset Index Fund or ETF should be OK.
6. As no one can foretell the future, for me simple is the better choice. At least you will be saving money on fees & charges, which is important. 
7.If you are going to use a advisor make sure you know the difference between an IFA and a FA. The first you expect to act as your agent, while the second acts as agent of the company whose products they are selling you.

dunstonh

I naively thought that Quilters role was to identify appropriate assets and invest accordingly.

No. That is either for you or your adviser to decide.  Quilter just take instructions from you or the adviser.

I have another GIA in trust for my son (with Brewin Dolphin) and I recently simply topped up via a Bank Transfer. I naively again thought this would be the same.

BD are a DFM.  You are paying them to make the investment decisions.  They do not carry out suitability checks like an IFA would (such as investment risk  and whether BD themselves are still suitable or whether alternative platforms could be better) but they do keep the investments within remit and adjust accordingly.    Its an expensive way of doing it but it is doing part of what you want.    

In terms of being incapable of running the trust in my daughters interests, I again naively thought that's why firms like Quilter exist. It stands to reason I want to make decisions in the best interests of my daughter rather than my own, hence seeking a bit of advice.

The IFA is the one that allows the trustees to effectively show they have done their duties.     The IFA selects the investments or the investment manager along with the provider/platform.   You have chosen to undertake that role personally rather than use an IFA.

Quilter, like BD are the product provider (known as a platform).  With BD you have also chosen them to be the investment manager.  Nothing you have said indicates that similar has been done with Quilter.  Quitler do allow DFMs on their platform but typically you need an IFA to be involved as ultimately, the IFA carries the liability for the actions of the DFM.   When you went to BD directly, there is no liability as it self directed.  

I have discussed this informally with a friend who is an FA and the previous FA on the account, neither of whom gave any indication that what I was proposing was ill-advised. 

FAs have a lower remit than IFAs and that usually means they have a lower understanding of the marketplace.   There is a wide difference between ill-advised and not being optimal.     For example, I wouldn't use BD.   I would not consider it optimal.   However, if you have selected the right portfolio from them, then it would not be ill-advised.

. I thought that my role would just be the same as my parents was for 20+ years (a name on an account largely managed by a trustworthy financial company) but it seems to be more complcated, so seems best if I find myself a financial adviser and talk it through with them. Thanks

Trustees have a legal responsibility to act in the best interests of the beneficiary. They also have to be seen to act in the best interests.  Nothing suggests you are not doing that.  The possibly tongue-in-cheek suggestion of moving it to cash savings may not be in the best interests.

You don't necessarily need an IFA.  But if BD is an example of your choices, it may well be worth an IFA being involved and it could work out cheaper.   However, if you do a bit of learning (as suggested higher up by others) then you may not need an IFA once you understand who is who in the relationship  (provider/platform, investment funds, investment manager, adviser etc).

truescot

I appreciate these comments. Ironically (?), the FA who was the previous adviser on the Quilter account and who advised us to set up the Brewin Dolphin GIA  for my son (as an "equivalent" to my daughter's Quilter CIA), is a Director for Brewin Dolphin.

I think I am either out of my depth or really not understanding, so I'll seek out an IFA.

All I want is my son and daughter to have a bit of money when they are in their 20s, whihc was my parents only wish, as they have done for 3 other grandkids. I have no other interest in investments. The anxiety is around making decisions about money that I don't fully grasp. Incidentally, why would a suggestion to move 19k into cash savings be "tongue in cheek"?

Eyeful

1. It is generally excepted, that over the longer term (say 10 years) asset returns are in the following order:-
Shares give the highest return.
Bonds.
Cash give the lowest return.

2. These may be of help to you with respect to advisors :-
https://www.moneysavingexpert.com/savings/best-financial-advisers/
https://www.which.co.uk/money/investing/financial-advice/how-to-find-a-financial-adviser-afZ375F6BIiC
https://www.which.co.uk/money/investing/financial-advice/how-much-financial-advice-costs-aODa70J6nYs7

jimjames

truescot said:

£12k being topped up by £6.5k

For these sorts of amounts, a JISA would probably be an easier option although the child can get access from age 18. But at least the charges should be lower and it should be simpler for you too.

From the comments above you might find that an IFA isn't viable for these sorts of amounts as their charges will be out of proportion to the investment values.

truescot

So it would appear my options are (tell me if I'm wrong):

1. Top up the account and instruct Quilter to allocate the 6.5k proprotionatley to the existing assets.

2. Find an IFA who can be allocated to the CIA, and take their advice reagrding whether and how to invest the 6.5k in the CIA on and continue advsing on an ongoing basis.

3. Learn more about DIY investment and do it myself, either with the Quilter CIA or another fund.

4. Close the account, withdraw the money and put it in cash somewhere else.

I realise 4 is probably the least advisable option in terms of groth over the next 5 or 6 years, I don't have the time to confidently do 3 yet, the initial reaction to 1. wasn't posiitve on here, therefore 2 may be my best option, even considering charges?

What would be the neatgatives of topping it up and instructing Quilter to allocate it proportionately to the existing assets? (which I had previously presumed they had chosen, but it would now appear my parent's FA did this)