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  • FIRST POST
    • Mistermeaner
    • By Mistermeaner 11th Feb 19, 6:34 PM
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    Mistermeaner
    Advisor fees transfer of isa to spouse on death
    • #1
    • 11th Feb 19, 6:34 PM
    Advisor fees transfer of isa to spouse on death 11th Feb 19 at 6:34 PM
    Hi

    Mum passed away recently : her and dad (who survives) each have a s&s isa of value circa 100k each

    These were arranged by a local financial advisor who charged them 1.5% on set up plus 0.5% a year

    The isas are with parmaneon invested in a simple range of low risk funds and have performed to expectation

    Mum died leaving everything to dad so went to see them today

    They want 1.5% of mum's isa as a fee for transferring it into dad's name

    That feels like a rip off to me

    Thoughts and commemts welcome

    I think I could do it myself for free
    Left is never right but I always am.
Page 1
    • masonic
    • By masonic 11th Feb 19, 6:43 PM
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    masonic
    • #2
    • 11th Feb 19, 6:43 PM
    • #2
    • 11th Feb 19, 6:43 PM
    If you can access the same or equivalent funds in on DIY platform, then you could potentially do it yourself for free.
    • LHW99
    • By LHW99 11th Feb 19, 7:23 PM
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    LHW99
    • #3
    • 11th Feb 19, 7:23 PM
    • #3
    • 11th Feb 19, 7:23 PM
    local financial advisor
    is this an independent financial advisor?
    I don't know if parmaneon only deal with advisors (intermediaries) some are like that.
    You could consider terminating the ongoing 0.5% if the investments reamin unchanged most years, and only pay for a review every few years on a transactional basis. Ongoing servicing does not have to be taken up, it is your choice.
    • Alexland
    • By Alexland 11th Feb 19, 7:26 PM
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    Alexland
    • #4
    • 11th Feb 19, 7:26 PM
    • #4
    • 11th Feb 19, 7:26 PM
    Given they were both paying for ongoing servicing then I don't really see why a new one-off charge should be proposed. The ISA cannot be transferred but the surviving partner would get an additional permitted subscription. Nationwide have some good webpages about this.

    https://www.nationwide.co.uk/support/support-articles/manage-your-account/isa-inheritance/


    Alex
    • dunstonh
    • By dunstonh 11th Feb 19, 8:01 PM
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    dunstonh
    • #5
    • 11th Feb 19, 8:01 PM
    • #5
    • 11th Feb 19, 8:01 PM
    They want 1.5% of mum's isa as a fee for transferring it into dad's name
    If they are being paid for ongoing servicing, then most advisers would carry out a transaction like this with no initial/switching charges. If they don't then you have to question what is it that they are paying ongoing servicing for.

    That feels like a rip off to me
    If it is in their published terms then its not a rip-off but expensive. If it is not in their published terms, then it is a rip and not allowed.

    is this an independent financial advisor?
    It is a platform usually used by FAs/Wealth managers and often using DFMs. Whilst it is possible some IFAs may use it, most will not as Parmenion is a platform geared and focused on being the platform used by the whole advice firm for everyone and everything. That is not consistent with how an IFA should operate.
    Last edited by dunstonh; 11-02-2019 at 8:03 PM.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • xylophone
    • By xylophone 11th Feb 19, 8:13 PM
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    xylophone
    • #6
    • 11th Feb 19, 8:13 PM
    • #6
    • 11th Feb 19, 8:13 PM
    https://www.hl.co.uk/investment-services/isa/additional-permitted-subscription-aps

    Investments: investments held in the deceased's ISA can also be transferred into the surviving spouse or civil partner's ISA directly without needing to be sold. Please note, investments can only be transferred into an ISA with the same company with which the deceased held their ISA.
    Otherwise Dad could sell the investments and transfer the APS to another provider who would accept it?
    • Mistermeaner
    • By Mistermeaner 11th Feb 19, 8:39 PM
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    Mistermeaner
    • #7
    • 11th Feb 19, 8:39 PM
    • #7
    • 11th Feb 19, 8:39 PM
    Hi all thanks for input

    Advisor is number 474097 on the fca register - I don't think they're independent

    As pointed out i was a little irked at the one off fee for what should be straight forward Admin (the holdings in each of mum and dad's isas are identical)

    I've emailed saying do nothing for his as not happy with one off charge

    Separately I've asked them to explain what they've been doing for the ongoing charge - from the paperwork i have its nothing as parmaneon seem to be running it

    As it's s&s holdings i presume they would need to be sold and then repurchased it moving to another provider (but dad could retain the isa status via APS)? Is this correct

    Thanks
    Left is never right but I always am.
    • LHW99
    • By LHW99 11th Feb 19, 9:09 PM
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    LHW99
    • #8
    • 11th Feb 19, 9:09 PM
    • #8
    • 11th Feb 19, 9:09 PM
    Normally with any ISA you ask the receiving scheme to do the transfer. If its S&S you have a choice of selling into cash before the transfer, or getting things transfeered as stocks / funds (providing the new platform can hold those). The first is generally quicker, but you have the selling costs. The second usually has transfer fees per fund / stock. What you don't do is close the ISA and re-open because it loses the ISA status.
    • londoninvestor
    • By londoninvestor 11th Feb 19, 9:14 PM
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    londoninvestor
    • #9
    • 11th Feb 19, 9:14 PM
    • #9
    • 11th Feb 19, 9:14 PM
    The second usually has transfer fees per fund / stock. What you don't do is close the ISA and re-open because it loses the ISA status.
    Originally posted by LHW99
    In this particular case ("transfer" to a spouse after death), the ISA status is effectively not lost by closing the ISA, because the surviving spouse gets an additional allowance equal to the value of the deceased's ISA. That's the "APS" that posters are referring to above.
    • Mistermeaner
    • By Mistermeaner 11th Feb 19, 9:16 PM
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    Mistermeaner
    Thanks

    Is this the same when it's an inheritance isa ? I read the nationwide link above (albeit quickly) and I understood you apply for the APS and once granted you can pay in cash to that value

    Nb mum had an isa with nationwide as well ; we went to see them today and they are opening one of their inheritance isas for dad to transfer mum's nationwide isa to him ..... I guess I can ask them to also accept mum's parmaneon isa ( if it's liquidated to cash)
    Left is never right but I always am.
    • londoninvestor
    • By londoninvestor 11th Feb 19, 9:20 PM
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    londoninvestor
    Thanks

    Is this the same when it's an inheritance isa ? I read the nationwide link above (albeit quickly) and I understood you apply for the APS and once granted you can pay in cash to that value
    Originally posted by Mistermeaner
    Yes that's right - "Inheritance ISA" is a term for what you pay the APS into basically.
    • Mistermeaner
    • By Mistermeaner 12th Feb 19, 11:20 AM
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    Mistermeaner
    I contacted Parmenion directly this morning telling them we don;t want to use the advisor to effect the transfer of mums ISA to dad. They replied:

    "In respect of the APS process, as we offer an advised service only, I'm afraid CRS Consultants will have to request the APS process online as this is an advised process. They will be able to do this once we've received the death certificate in the post. When they have initiated the process through your father's account online, it will produce forms that your father will need to sign, the executors and adviser. This will also need to be sent in with the original Grant of Probate so we can complete the process our end."


    I replied to state:
    "Re the APS we do not want to be tied to using crs - can you please advise alternatives ; ie we will be willing to sell the holdings to cash and use our aps with an alternative provider"


    To which they advised:

    "To disinvest the funds we will still require the original Grant of Probate and a written instruction signed by all the executors confirming where you'd like the proceeds to be paid.

    I'm not able to advise you, however the only way you can process the APS with us is through the registered adviser on the portfolio.

    If you decide to apply for the APS through an alternative ISA provider we will require their APS valuation request."



    So i guess the next steps are to get probate etc. and to set up an 'inheritance ISA' in dads name with nationwide (for simplicity)... then sell the holdings within the parmenion ISA and pay the cash into the nationwide inheritance ISA

    Does this sound about correct?
    Left is never right but I always am.
    • Alexland
    • By Alexland 12th Feb 19, 12:19 PM
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    Alexland
    Sure if you want to avoid the advisor's one off fee (which we broadly agree is unreasonable given they are serviced customers) then you could help your dad do it himself however this will leave him with a big cash ISA earning below inflation and an advisor who is only partially servicing his wealth.

    What's the plan next?

    Alex
    • xylophone
    • By xylophone 12th Feb 19, 1:10 PM
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    xylophone
    He could liquidate Mum's ISA and transfer to a stocks and shares ISA with another provider who would accept APS?

    He might consider liquidating both and transferring to another provider?
    • Mistermeaner
    • By Mistermeaner 12th Feb 19, 1:22 PM
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    Mistermeaner
    Sure if you want to avoid the advisor's one off fee (which we broadly agree is unreasonable given they are serviced customers) then you could help your dad do it himself however this will leave him with a big cash ISA earning below inflation and an advisor who is only partially servicing his wealth.

    What's the plan next?

    Alex
    Originally posted by Alexland
    fair question; plan next would be to also sell dads isa and move the lot over to nationwide (within the isa wrapper). It will be earning a paltry 1.4% but will be free of the advisor

    From there I will look to set up an S&S platform such as charles stanley or H&L and self invest a portion of the funds in something suitable (VLS20 or similar)

    NB: I self manage my pension, my LISA's and S&S ISA's held variously accross HL, Charles Stanley and Zurich ... im no expert but am reasonably proficient in this stuff (mainly from stuff learned here!)
    Left is never right but I always am.
    • Alexland
    • By Alexland 12th Feb 19, 2:33 PM
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    Alexland
    From there I will look to set up an S&S platform such as charles stanley or H&L and self invest a portion of the funds in something suitable (VLS20 or similar)
    Originally posted by Mistermeaner
    If you are going to help him go DIY then rather than invest in a very low risk fund it might be better to invest in a mix of cash and a balanced risk fund such as VLS60 to stand a good chance of keeping up with inflation. Considering the amount involved iWeb might have a more attractive fee structure.

    Alex
    • dunstonh
    • By dunstonh 12th Feb 19, 2:45 PM
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    dunstonh
    From there I will look to set up an S&S platform such as charles stanley or H&L and self invest a portion of the funds in something suitable (VLS20 or similar)
    HL is expensive and VLS20 is a low quality fund. VLS is better up the scale but not great lower down the scale.

    How does VLS20 compare to the volatility rating of the existing investments? Are you taking him out of something earning around 5-7% a year after charges into something earning around 2-3% after lower charges?
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Mistermeaner
    • By Mistermeaner 12th Feb 19, 2:54 PM
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    Mistermeaner
    HL is expensive and VLS20 is a low quality fund. VLS is better up the scale but not great lower down the scale.

    How does VLS20 compare to the volatility rating of the existing investments? Are you taking him out of something earning around 5-7% a year after charges into something earning around 2-3% after lower charges?
    Originally posted by dunstonh
    its invested in a mish mash of bond funds that have earned 10% over the last 3 years before fee's... so around 3% per annum

    Honestly I haven't thought as far ahead as what underlying investments to buy into...

    FYI dad is 82 and has plenty of income from pensions his primary objective is capital preservation

    thanks all for input
    Left is never right but I always am.
    • Mistermeaner
    • By Mistermeaner 13th Feb 19, 10:32 AM
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    Mistermeaner
    Discussions with advisor continue ; I’ve told them unless they wave the 1.5% fee for transferring mums isa to dad I’ll do it myself

    Regards the ongoing fee they’ve been charged 0.5% per annum since these plans were set up in 2015 - there’s no record of anything being done in respect of reviews in my mums files and I’ve asked the advisor to provide me details and records of what they’ve been doing for this fee... they ummed and arrred and said theyll get back to me .... I have a feeling they’ve done nothing other than take my mum and dads money each month (all portfolio balancing was done by parmenion) .... do I have any scope / opportunity to recover fees paid for ongoing management if there hasn’t been any?

    Also if I just terminate this ongoing management from now could they mess me around regards transferring both mums and dads ISAs out of parmenion to a.n.other ?


    Thanks
    Left is never right but I always am.
    • dunstonh
    • By dunstonh 13th Feb 19, 10:51 AM
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    dunstonh
    Ask for a copy of the fee agreement showing what services are provided for the 0.50%. The FCA do not state what services are required to be listed. However, they do say that advisers should be doing what they say they are doing. And post-January 2013 (on business set up after that date) they must be doing something in return for the remuneration. They can't just take 0.5% and sit back.

    The exception is St James Place who can charge and do nothing.

    I have a feeling they’ve done nothing other than take my mum and dads money each month (all portfolio balancing was done by parmenion) .... do I have any scope / opportunity to recover fees paid for ongoing management if there hasn’t been any?
    The platform provides no advice or manual rebalancing or adjustments. The adviser firm does that (or the DFM, if one of them is involved). The platform does have an automatic rebalancing functionality but that just takes it back to the original allocation or the last set allocation input by the adviser. If the allocations have changed, then an adviser working under "advisory" rules must get permission first to make changes. If under DFM (discretionary) rules, then they do not.

    As above, if the work they agreed to do has not been carried out, then you should be refunded.

    Also if I just terminate this ongoing management from now could they mess me around regards transferring both mums and dads ISAs out of parmenion to a.n.other ?
    no
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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