Financial Advisors

dunstonh

Thanks once again dunstonh. I must admit that the case of the person losing most of his money was almost thirty years ago (you will say before current regulation)

Yep. long before regulation Actually, IFAs didnt come about until 1988. Before polarisation there was no real definition of the different types of advisers and what they could and couldnt advise on. It was a totally different world back then.

but who knows what nasties the markets may throw up in the future.

The markets have always thrown up nasties and will always throw up nasties. You take the rough with the smooth and you average it out. You also must realise that the "markets" does not mean one level of risk. You can get low risk investments through to high risk. If you are cautious then the portfolio should be weighted that way.

Besides there is a very real possibility that I may have a call on 100k (out of 250k) if we move house in a year or so which is a distinct possibility.

Well for 100k (and possibly a float on top) you keep that in cash. There really is no other option for that particular chunk.

As regards an IFA probably running rings around my Nationwide bloke I just hope he/she doesn't run rings around me. Forgive me for my cynicism.

Some cynicism is necessary. When i go to seminars etc and other IFAs are there I see some who I cannot believe are really IFAs. They are a disgrace to the profession. They should go back to being tied agents with the banks. And that is probably where they will be in 5 years time with the rule changes coming in. Then there are others that make me feel is if I know nothing. So the skills range is vast.

However, you can spot the signs of a greedy, low experienced or lazy adviser. Lack of explaining things. Wants you to sign without telling you much about it, single fund investing (i.e. all your money going into one investment fund), unable to answer questions in simple language, unable to show you research when you ask for it, greedy will be size of the commission (which you are told about before you sign). Being evasive of charges and/or commission information.

IFAs have the lowest complaints with the FOS of any distribution channel. So, remember that and what to look out for (and avoid salesforces) then you should be fine.

1echidna

Thanks dunston. I gather that you are a fully paid up member of the IFAs trade union, but I can't fault your logic. I think I will bite the bullet, try and sort myself out a good IFA, and, to a degree, go with the flow.

Aegis

Lokolo wrote: »

Nothings guarenteed with the stock market, ever. Thats what you need to realise. If you aren't prepared to take risk, should you even be investing?

Although there is some risk of people losing out at the end of the year, do you know their situations? Did they want to go high risk? How much did they put in?

A tip: "Don't gamble what you can't afford to lose". Its someone's signature on these boards, and its true, investing is a gamble, so unless you're prepared to lose it, don't bother.

Awesome, I'm being quoted when I have nothing to do with the thread in question!

1echidna

Interesting the first IFA I visited gave me a lot of time and we had a very interesting discussion. Based on my risk profile (cautious) and the amount of money (30k) I was prepared to invest from my existing portfolio (mainly cash deposits)and he felt his services were uneconomic (fee min £750). He recommended using HL to transact business and the AXA Distribution Fund as one he favoured and did not dissent from the view that I could leave the decision a couple of months. I have subsequently been to another IFA who felt she could be useful to me. Her charge was 3% initially followed by 1/2% for subsequent yearly reviews. I am going to take my time investigating further. My feeling is that equities in general are not going up any time soon.

Graeme7777

1echidna wrote: »

I have come to the conclusion after some amount of study that I don't understand stock or commodity markets and may not understand them better with more study.

For what it's worth, I don't think that you need to become an expert on such matters to earn good returns. You do, however, need to educate yourself enough to gauge whether or not a prospective advisor knows what he or she is taking about.

Good Luck!

dancingfairy

I was going to say you need to establish your risk profile - are you somone who wants a steadyish return every year or would you be happy to take the option of investing lots with the potential to make loads but also to loose loads of money as well. I think you need to think about when you want the money 10/20/30 years? and for what eg retirement/to pay off mortgage/to fund children through uni etc.
Also ask the adviser why they recommend certain things and you should know how much is invested in riskier things and how much in safer things.
P.S Just because you don't think shares are going to go up anytime soon - at least you should have the advantage of buying them cheaper.