£100K - Where Do I Put It??!!!

boy_3

In my view, most IFAs are not worth their commission. They only know the trivial things and give you the same. You can get the same information from bit of reading on net (like this forum) and using your common sense.
Though, I would probably use specialist investment advisers once you have decided where you want to invest your money. e.g. fund adviser for funds and shares, property expert etc.
Surely in the end, to minimise the risk while trying to get good return, it makes sense to spread your 100k (which isn't a lot by the way in invest terms) in multiple investment vehicles. e.g invest in all. Funds+Shares+Savings+ISA+Property.

Aegis

boy wrote: »

In my view, most IFAs are not worth their commission. They only know the trivial things and give you the same. You can get the same information from bit of reading on net (like this forum) and using your common sense.

You're suggesting that a professional who earns his living by transacting these deals and fitting products to client needs only knows trivial things that could easily be found on the net? Someone with access to a lot more information on each of these fund companies, and with specialised software to show the specific asset allocation that comes about from certain combinations of funds?

As someone who really likes to invest in funds, I'm saying that this is rather dubious. There is simply no way that I have access to anywhere near the same level of information, even going through somewhere like trustnet and citywire. I have to manually calculate the effect of any addition to my portfolio, and though I enjoy doing so it takes me a lot longer to make any decisions than it would take someone with the specialist knowledge and tools.

To top it all off, if I make a mistake and add a fund to my portfolio without realising the risk level, and it bombs, I have no-one to blame but myself. If I go to an IFA, I get a portfolio tailored to my risk profile and my objectives, and if something like that happens I can claim compensation for a mis-sale.

In short, I'd say it's worth the commission cost for the long term investor with a significant sum, but as with all things hunting around for the best deal is a good idea before hand.

chesky369

Having a good IFA does not absolve you from responsibility for your own money - they explain and in the end YOU make the decision, after gaining knowledge from them. And the idea is they INCREASE your money, thus making their fees almost irrelevant, since your would never have made so much on your own.

dunstonh

n my view, most IFAs are not worth their commission. They only know the trivial things and give you the same.

Oh dear. That made me laugh. I would love to see you try and transact just a fraction of what a good IFA does with just "internet and media" research available.

But its only £100K after all. Lets see; 5% commission would be £5000. Enough to get the whole house decorated and new carpets.

If you were investing £100k, you wouldnt want to use an IFA taking 5% commission. You would want it discounted or better still work on customer agreed remuneration or fee basis (which is basically the same thing). You would be aiming for around £1000 or 1% on that.

Quote:
as well as considering the IQ of the individual
How do you do that, then?

The joke when that rule came in last year was to ask them their IQ right out or make them sit a test. However, what it tends to come down to is looking at their current and past occupations, past investment experiences and documenting their understanding. Basically, if you see a thicko you cant document "he was a thicko" but you have to use phrases like "low experience and limited understanding of investments" and "not likely to keep involved in reviewing his investments". A good one is "he find investments boring".

As someone who really likes to invest in funds, I'm saying that this is rather dubious. There is simply no way that I have access to anywhere near the same level of information, even going through somewhere like trustnet and citywire. I have to manually calculate the effect of any addition to my portfolio, and though I enjoy doing so it takes me a lot longer to make any decisions than it would take someone with the specialist knowledge and tools.

They are great tools available for free but you should see Financial Express analytics for example. That costs £5000 a year (plus VAT) and is the adviser version of trustnet. However, the detail and information on there is worth every penny to an IFA. I pay over £10k a year in software and a consumer is never going to pay that and even if they did, they then have to understand it.

There are advisers out there that a salesmen and there are advisers that are advisers. Currently the waters are muddied as its hard to tell which is which sometimes. However, this has been recognised by the FSA and latest proposals for 2009 will see a split and clear definition between advisers and salesmen. Long overdue and there will almost certainly be a transitional period meaning it may take until 2012 to be fully implemented but it will make it easier in future.

digital

greedbay wrote: »

Never put any money into a stocks and shares isa.

Has worked, and is still working, for me. You need a 5+ year horizon though.

Meltdown_2

dunstonh wrote: »

The joke when that rule came in last year was to ask them their IQ right out or make them sit a test. However, what it tends to come down to is looking at their current and past occupations, past investment experiences and documenting their understanding. Basically, if you see a thicko you can't document "he was a thicko" but you have to use phrases like "low experience and limited understanding of investments" and "not likely to keep involved in reviewing his investments". A good one is "he find investments boring".

So what score would you give Gordon Brown (selling-off Gold at a low point), or Mr Eyebrows (pouring money into a failed bank)?
:rotfl: