Transfering DB to SIPP

Its not the risk profiling as such that's daft, its the specific questionnaires that I have been made to fill out in the past, supposedly to arrive at my risk profile and the way they were then used to push me into a particular investment.

How is the adviser able to decide what your risk profile is if they do not ask those questions. Also, that is just part of the risk profiling. Advisers take those questions as a starting point. However, they also look at your knowledge, behaviour and capacity for loss as well. Its not just a scoring system.

I consider myself fairly cautious, but when I am considering what investment to make for a small part of my total assets I reserve the right to be incautious. I also resent the way if you are cautious you are automatically pushed into gilts & bonds - who is to say that they are even low risk at current yields??

Gilts and Bonds, when they suffer a crash, it is typically no more than 5%. Stockmarket crash can be upto 50%. So, as a measure, they are low risk in terms of what they are likely to go down by. Cautious portfolios are multi-asset. It would be highly unlikely you would have a 100% fixed interest. just as you would not expect 100% stockmarket at the other end or 100% cash.

I also don't understand why being cautious should make you considered more likely to do something as recklessly stupid as to sell out of an investment after a crash.

There are plenty of investors investing well over their risk profile who will sell at the worst time when the next crash comes along. Its about finding the level that is financially sensible and also not going to result in you doing something silly when the next downturn comes.

Virtually all investment complaints come from people moaning about losses in value. No-one moans about something going up.

i have had experience of people that say all the right things and make all the right noises but when the event actually happens, they suddenly backtrack. With a £20,000 investment losing £5000 in a crash, it may not enough to trigger the client being scared. With a £400,000 investment suffering the same degree of loss, that is £100k. Or £200k loss if £800k fund. Those sums can change peoples views.

I do except though, that things may have moved on and the risk profiling as part of this exercise might be rather better done and not a total waste of time.

I have been doing this for over 20 years and seen the process change beyond all recognition. You also see continued adjustments by the software companies following regulatory feedback. Just today, Rory Percival (highly regarded ex FCA) has issued a report on risk profiling and he has analysed a few of the major tools used.

No but I am paying for someone else's insurance and I am paying more for someone to jump through hoops to meet compliances in order to satisfy the insurance companies.

I blame lawyers not IFA's though.

Nothing is being done to satisfy insurance companies. It is being done to satisfy the regulator. Plus, the industry is a lot more professional nowadays and advisers are there to advise. Not to tick boxes just to do what you want to do.

PI insurance is just one of the [too] many costs an IFA has. However, I highlighted as a cost that goes on long beyond your particular one-off transaction.

pip895 wrote: »

The transfer value of the policy was £162,000 in 2011 but has escalated to a whopping £483,000 today. I can only see this figure going down from here with interest rates beginning to rise?? So if I want to transfer I think now is the time.

If interest rates stayed the same, your CETV would continue to rise simply because you are getting older and it is getting closer to being paid. Other things that might make it rise are increases in inflation.

So yes, while an increase in interest rates might see it fall, there may be some offsetting factors. It's the relativity of all of these changes that will determine the overall outcome.