Does anyone here use an IFA?

kempiejon

etienneg said:

OK. Thanks to all who responded to my post above. As is often the case, terminology can cause problems and I think this answers a major part of my query. I was taking "increase returns" to mean "leave the investor with more money" - that is, taking into account his/her situation, taxation, and so on. I see that others are using it in a much more restricted sense, just meaning "returns on an investment". My use may well have been wrong. In the end it doesn't matter; what does matter is that I now have a clearer understanding, so thanks.

Conclusion: If an investor wants (or needs) the bigger picture to be covered, an IFA may well be the way to go. However, if s/he knows sufficient of the rules and regulations surrounding tax and investment vehicles, and just seeks help with choice (an "investment advisor"), then an IFA is not a good choice and his/her fee may well end up reducing the overall return to the investor.

In the leave the investor with more money highlighted - compared to what? For sure better than leaving it in the bank but compared to the teach yourself approach tough call all clients are different.
I do not IFA but I do DIY investing and reckon I have a good handle on my investments. As the years of investing wages and profits might come to a U turn to de-accumulate I'm looking ahead and finding the tax optimisation, sequence of returns mitigation, inflation proofing and asset allocation a whole new set of skills. If an IFA could do that list, some of that or that and more, picking up things missed it'd be a few £k well spent for some. As a %age of ones total wealth in perpetuity starts to look expensive. Just my impression, I engage well with the process.
I'm confident in my own abilities but nod to the Dunning-Kruger effect.

Bostonerimus1

etienneg said:

OK. Thanks to all who responded to my post above. As is often the case, terminology can cause problems and I think this answers a major part of my query. I was taking "increase returns" to mean "leave the investor with more money" - that is, taking into account his/her situation, taxation, and so on. I see that others are using it in a much more restricted sense, just meaning "returns on an investment". My use may well have been wrong. In the end it doesn't matter; what does matter is that I now have a clearer understanding, so thanks.

Conclusion: If an investor wants (or needs) the bigger picture to be covered, an IFA may well be the way to go. However, if s/he knows sufficient of the rules and regulations surrounding tax and investment vehicles, and just seeks help with choice (an "investment advisor"), then an IFA is not a good choice and his/her fee may well end up reducing the overall return to the investor.

An IFA probably won't get you any better returns from an investment portfolio compared to a simple multi-asset fund or index fund portfolio with a similar asset allocation that you can easily construct yourself, and you will be 0.5% to 1% behind because of their fees. The utility of an IFA is more difficult to gauge when it comes to just organizing your finances and spotting opportunities for tax efficiency etc. For most people with simple finances this is not rocket science, but if they just don't want to do it themselves then they might think that it's worth the fee. So pay for an IFA's knowledge of financial planning, not for the expectation of better investment returns.

Ibrahim5

Just look up the dictionary definition of parasite. That's how IFAs work. The first step is to determine if you are worth attaching to. Someone who is knee deep in payday loans if desperately in need of financial advice but they won't get an IFA. Often IFAs have someone to answer the phone. "Oh you want help with your pension. So do you mind if I just ask how much is in it?". They are assessing your suitability as a host. If you are worth attaching to they then come and see you and befriend you in the hope of starting that long term relationship to provide the nourishment they crave at the host's expense.

Cus

I'd sooner this didn't turn into an "advisors are all rubbish" thread please 👍🏼

You made it to 3 pages before the usual suspect showed up, good result. Thread closed 😁

Ibrahim5

I didn't say they were rubbish. They are actually very good at their long term relationships.

Section62

Ibrahim5 said:

Just look up the dictionary definition of parasite. That's how IFAs work. The first step is to determine if you are worth attaching to. Someone who is knee deep in payday loans if desperately in need of financial advice but they won't get an IFA. Often IFAs have someone to answer the phone. "Oh you want help with your pension. So do you mind if I just ask how much is in it?". They are assessing your suitability as a host. If you are worth attaching to they then come and see you and befriend you in the hope of starting that long term relationship to provide the nourishment they crave at the host's expense.

Debt advice =/= financial advice.

Aminatidi

Anyone have a view on the likes of ChatGPT?

I've been playing with the free version and don't get me wrong I've read and watched a lot of articles and videos but I was very impressed at how good it was as an augmentation for all that DIY.

Not sure I'd trust it with raw numbers (give it time?) but for broad suggestions around prioritising between ISA and SIPP and the fairly common planning type questions you see on here - damned impressive.

Ibrahim5

So an IFA wouldn't help me if I had a mortgage? I would need a debt advisor?

QrizB

Aminatidi said:

Anyone have a view on the likes of ChatGPT?

But that might just be me!

dunstonh

Anyone have a view on the likes of ChatGPT?

There was a thread a month or so back on a pension eligibility issue and ChatGPT got it wrong.

I've played with ChatGPT a few times but it suffers USA bias and fashion bias.  

So an IFA wouldn't help me if I had a mortgage? I would need a debt advisor?

You would use a mortgage adviser.  IFA qualifications and regulatory permissions do not cover mortgages.   Mortgage has its own qualifications and regulatory requirements.   It is common place to find mortgage advisers working in IFA firms but its unusual nowadays to find IFA (individuals) doing mortgages.     Debt advice also requires further authorisations and regulatory permissions, which are not within the normal IFA permissions.