Financial advisor (private pension) to retain or not?

Mar 24, 2010
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We both have Pru pension schemes setup by a FA who we know well.Happy with it but is it worth still paying to keep him "onboard" each year? Wifes is a six year( "drawdown?) one as she doesn't get state pension until 2021 so draws a portion of pot each year until then.Mine is "medium risk".We have a meeting with him Mon morning.
 

denisejoe

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Aug 6, 2014
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We dumped ours after the first year as charges took almost all the growth the pot had made. Fortunately as I have a private pension which is paid monthly and we both have our state pensions we haven't needed to draw down the pension pot at all apart from the 25% taken at the start. Didn't feel it was worth the charges to keep the FA every year. If necessary we can just contact him on a one off basis although I can't really see this being necessary as we're quite capable of deciding whether we need to draw down some money which you have to do via Head Office anyway.

Obviously your circumstances may well be different and only you can decide whether or not it's worth keeping him.

Denise
 
Jul 29, 2013
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We use a FA who is very good but we do have other investments to look after but if we only had a pension I don’t think we would have him.
We pay him out of our interest so don’t really see that money.(y)(y)(y)

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Feb 9, 2008
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As above, ours doesn't look after our pensions but the other investments we have. He's worth the money.
 
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Chris51
Mar 24, 2010
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He charges 0.5 % (about £500 year) as we are close friends of him and his family.Its still £500 yr will see what he comes up with Monday.We have quite a lump in Isa"s that are doing nothing -any ideas about making that pay without permanently tying it up?
 
Jul 29, 2013
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He charges 0.5 % (about £500 year) as we are close friends of him and his family.Its still £500 yr will see what he comes up with Monday.We have quite a lump in Isa"s that are doing nothing -any ideas about making that pay without permanently tying it up?
We have stocks and shares ISAs that we draw tax free income from they are very good. It’s worth asking about them(y)
 
Jan 8, 2013
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We have quite a lump in Isa"s that are doing nothing -any ideas about making that pay without permanently tying it up?

We moved ours into Premium Bonds - pays a bit more - totally flexible and the chance of THE BIG WIN!

We moved our pension into a SIPP although we don't do any investments or withdrawals it grows at a steady rate and a very low annual charge.
We fell out with FA as even if they lose you money you still have to pay their fee - hows that work?:Eeek:
As pension are not taxed on death, hopefully we are intending leaving this pot as the kids inheritance - come the day:party2:

We are with

Best Invest

https://www.bestinvest.co.uk/?campa...MIiK_K1uCT2QIVzbDtCh0SZgIEEAAYASAAEgI9C_D_BwE


Or there is Hargreaves Lansdown

http://www.hl.co.uk/investment-serv...MIj9jWseCT2QIVzbDtCh0oWAL7EAAYASAAEgJyX_D_BwE
 
Jul 29, 2013
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We moved ours into Premium Bonds - pays a bit more - totally flexible and the chance of THE BIG WIN
You can earn more in other investments such as a bond, although it means tying your money up longer but you get a much better return

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Jul 29, 2013
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How long is the term? - I could be interested if there is a good, guaranteed, return
Usually 5 years but you can get your money out at any time but have to wait a while and of course not such good returns. Phoenix life was a good one when we bought a couple of years ago we draw an income and it still makes in excess of that,it’s worth looking into.
We used to have PBs but our FA kept saying he could make a better return if we let him and true to his word he has looked after our funds well
I don’t know about guaranteed return but We are happy
 
Apr 28, 2010
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Every time I go into any of our banks, they try and get me to see one of their advisors and I always reply .......

You lot, not you personally of course, brought this country financially to it’s knees and you think you know better than us on how handle our money. Well, our mortgage was paid off in fifteen years and I retired five years early, so sorry, no and anyway, I sleep with my Financial Advisor. :)

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Jul 29, 2013
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Every time I go into any of our banks, they try and get me to see one of their advisors and I always reply .......

You lot, not you personally of course, brought this country financially to it’s knees and you think you know better than us on how handle our money. Well, our mortgage was paid off in fifteen years and I retired five years early, so sorry, no and anyway, I sleep with my Financial Advisor. :)
That may be I would not argue with that but a good independent FA is really worth the money ours is not connected with any of the banks and is a straight A’s the day is long you just have to get the right one by research.
 
Oct 12, 2009
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You can earn more in other investments such as a bond, although it means tying your money up longer but you get a much better return

I agree for a fixed investment Bonds and particularly Corporate Bonds not Govenment Securities offer some good returns.

I look after my own investments because I spent long enough in Financial Services, not as a FA although I did the exams but as a Compliance Officer checking on FA's advice being appropriate for the client.

I bought a Bond issued by a Property company a few years ago, which is for a 7 year term and pays 6.25%, inside my ISA, so is Tax-Free.

This bond is quoted and tradable on the Stock Exchange so I can easily cash it in. I bought on issue at £1 par value and at last check was trading at £1.02, so a slight gain there, but that will disappear as it approaches maturity which will redeem at par.

I would encourage others to buy tradable bonds, for two reasons; firstly one can check the market price and if the market senses any sign of the company defaulting that will be reflected in the price; secondly, one can get out either because one is nervous or one might want the cash for personal reasons. This is not true of non-tradable bonds.



A small point on the difference in spelling of 'Adviser' or 'Advisor'. I am not picking people up on the use of the American 'Advisor' in this thread, but merely to point out that the Financial Conduct Authority uses 'Adviser' in its Rule Book, so if anyone purporting to be a good FA uses 'Advisor' they appear to have not read their own rule book, so beware.

Geoff
 
Aug 18, 2011
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I AM 73 NEXT,,,think i have enough left to keep me going until i can't tour any more (just guessing) so not bothered about investments,,,,fully intend to die the same way i was born,,,Skint,,,Just hope my last cheque to the undertaker bouncers,,BUSBY:LOL::LOL:

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Aug 26, 2008
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He charges 0.5 % (about £500 year) as we are close friends of him and his family.Its still £500 yr will see what he comes up with Monday.We have quite a lump in Isa"s that are doing nothing -any ideas about making that pay without permanently tying it up?

Cooeeeee! I'll be your friend too for £500! :D
 
Feb 9, 2008
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Just a point, as stated above, never use the bank's own advisor, they can only recommend their own products. These are usually rubbish, with high charges.
 

appydaze

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I have for years had a house divided into two flats with a monthly income of £1200.00 plus yearly rises.
I wont pay these so called financial advisors, supporting their lifestyles off of my back.
To me, you can't get a better return and as a bonus your investment goes up as property invariably does.
I can understand people not wanting to take a risk but what risk are you taking.
Good luck..... :cheers:

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Langtoftlad

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My guesses as to the future performance of the stock market is as reliable as any paid advisors :rolleyes:.

Tracker funds tend to do better than most fund managers and/or advisors.

A lot of so called professional advisors don't do any research themselves, they simply enter the data into a piece of software and an algorithm comes up with the suggested products.
You can now do this yourself using so called Robo-Advisors such as Nutmeg. I believe Nationwide are launching a similar platform.

So pay an advisor for initial advice if you must, but to my mind paying continuation fees is crazy :confused:.
 

GWAYGWAY

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I had a sum of £76000 pot and the annuity that the same comapny tried to give was £1003 per year as a taxable pension. I took it to a FA and he got £3140 using bad health criteria. I KNOW I was being robbed by both companies.. £76000 in a bucket under the desk and they wanted ME to have £1003 PER YEAR. I would have to have lasted an awful long time to get half of it back at that rate.. After I was committed to that bigger one for a year the government came out with the ability to draw the whole sumout albeit with tax at 40% over me allowance. I would have taken that and wouldbe able to stretch that out at a damn sight better rate that what the thieving annuity company is paying me. 74 years life expectancy at 64 with slightly dodgy health.?????????????????????????? sod off!
 

mikebeaches

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If you'd rolled up all those 500 quids into your pot instead, plus all of the compound investment returns..... THAT is what needs actually cost you. A lot of money.
I understand that some folk feel more comfortable using a financial adviser, but I agree with the Nomad - that over the years, the fees, which if compounded in your own account, could amount to a significant sum of money.

Now having never used an IFA I might be wrong about this, but I suspect they don't recommend individual stocks and shares to buy? More likely, if investing in the stock market, it will be suggestions of which 'Funds' to buy.

And there go yet another set of charges to those so called expert and well paid managers that administer the funds. So another slice of your money to someone who believes they can pick the right stocks to make you some money. But the fact is that only around 20 - 25% of fund managers beat the market or a passive index tracker each year.

Oh and most fund managers are buying and selling shares in their funds all the time, so there's a third slice of fees (your money) going to the broker who is dealing the shares. Not to mention the 0.5% stamp duty tax that goes to the government every time they buy some shares.

And where is your fund held - most likely on a platform, such as offered by Hargreaves Lansdown, who will take a further 0.45% for the privilege.

Of course there are costs involved however you choose to invest, but using an IFA appears to lay on at least an additional 2, possibly 3 layers of charges, in my opinion ie their own fees and those charged by the funds they recommend, and additional charges the fund managers incur continually buying and selling. So it just seems like a lot of extra people getting their hands on your money when a FA is involved.

Personally, I prefer to read up a little, but by no means spending too much time on research. Buy a selection of good individual shares for either my ISA or SIPP; and normally hold on to them for the long term. Adding more as an when I see an opportunity if I've got the money available.

Yes, I have to pay to buy the shares in the first place - so broker charges, platform fees (but not at Hargreaves Lansdown - yes they are good, yes they are big - but wow so expensive!!) and government stamp duty - but that's it. I only rarely sell stock. Investing should, if possible, be a long game; and so after around 25 years it seems to be working for me.

However, I wouldn't advocate putting all of your money in the stock market. We've always kept some in completely secure cash ISAs. That was until the interest rates were totally trashed...

Thankfully, along came peer-to-peer (p2p) lenders. And even better, the Chancellor decreed that they could apply for Innovative Finance ISA (IFSA) status. In other words, submit themselves to the Financial Conduct Authority (FCA) to demonstrate their compliance standards, administrative procedures and finances are robust. Having said all that, there are still significant risks attached to the underlying loans made via p2p. Currently, I've spread a bit of cash around 5 different p2p providers to diversify the risks - but it clearly is not the same as money in a bank or building society. But I was able to transfer a number of building society ISAs to become p2p Innovative Finance ISAs at interest rates between 3.75% and 7%. (y)


PS Sorry about the length of the post! ;)

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Langtoftlad

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Apr 12, 2011
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He charges 0.5 % (about £500 year) as we are close friends of him and his family.Its still £500 yr will see what he comes up with Monday.We have quite a lump in Isa"s that are doing nothing -any ideas about making that pay without permanently tying it up?
That 0.5% is only his cut - as @mikebeaches says there will be platform fees, transaction fees, management fees etc etc all making a significant dent in any returns you might be making.

As for your non performing ISA:
An ISA is only a tax efficient wrapper, not an "investment" in itself.
It could be in a cash deposit which would explain it "doing nothing", it could be in a building society or bank savings account which would be safe but terrible interest, or it could be in a lousy investment.

TBH, alarm bells a ringing if your friend, your IFA [he is an Independent isn't he, not just an adviser from the Prudential? ] has not highlighted and warned you about this poor or non performing ISA - let alone explained what an ISA is :unsure:.

A balanced portfolio will contain immediate cash, short term savings and longer term shares, bonds & gilts.
The exact proportion will depend on your attitude to risk and the time frame you are looking at.

  • Cash in the bank
  • Savings in deposit accounts, defined length bonds or National Savings [Premium Bonds]
  • Investment - passive tracker funds which are cheap & diversify your risk over a large basket of shares/bonds
  • Risk, Flutter, Gamble - have fun with a small proportion in something like Precious metals, crypto-currencies, or P2P lending
All of which can be wrapped up in an ISA subject to annual limits.
 
Apr 22, 2013
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The best thing I did was to move all my private pensions, I had three, into a SIPP. My pension pot is now the same as it was when I retired six year ago. In that time I have taken a25% lump sum and taken the max pension for all six years.

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OP
Chris51
Mar 24, 2010
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That 0.5% is only his cut - as @mikebeaches says there will be platform fees, transaction fees, management fees etc etc all making a significant dent in any returns you might be making.

As for your non performing ISA:
An ISA is only a tax efficient wrapper, not an "investment" in itself.
It could be in a cash deposit which would explain it "doing nothing", it could be in a building society or bank savings account which would be safe but terrible interest, or it could be in a lousy investment.

TBH, alarm bells a ringing if your friend, your IFA [he is an Independent isn't he, not just an adviser from the Prudential? ] has not highlighted and warned you about this poor or non performing ISA - let alone explained what an ISA is :unsure:.

A balanced portfolio will contain immediate cash, short term savings and longer term shares, bonds & gilts.
The exact proportion will depend on your attitude to risk and the time frame you are looking at.

  • Cash in the bank
  • Savings in deposit accounts, defined length bonds or National Savings [Premium Bonds]
  • Investment - passive tracker funds which are cheap & diversify your risk over a large basket of shares/bonds
  • Risk, Flutter, Gamble - have fun with a small proportion in something like Precious metals, crypto-currencies, or P2P lending
All of which can be wrapped up in an ISA subject to annual limits.
He is a IFA and the pension he set up is a PRU one-they of course take out an annual fee (£340) as well as his £360) which is about £17 a week.The subject of pensions/investments unfortunately affects all of us on here and I appreciate the advice given and glad it has raised such an amount of interest.Certainly will be looking into other investments mentioned on here.As far as I am concerned an ISA is of no use anymore with the new "interest tax free " rules.Its just having the "bottle" to set up your own system!
 
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Chris51
Mar 24, 2010
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The best thing I did was to move all my private pensions, I had three, into a SIPP. My pension pot is now the same as it was when I retired six year ago. In that time I have taken a25% lump sum and taken the max pension for all six years.
Very interested in your advice.What is a SIPP ?
 
May 31, 2015
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We both have Pru pension schemes setup by a FA who we know well.Happy with it but is it worth still paying to keep him "onboard" each year? Wifes is a six year( "drawdown?) one as she doesn't get state pension until 2021 so draws a portion of pot each year until then.Mine is "medium risk".We have a meeting with him Mon morning.

I would vote to keep him . My FA is pretty proactive and has probably saved me a great deal of money , with his advice . Just before the the recent financial crash , he advised securing part of , and several other adjustment's , to the effect , where i lost nothing . Indeed much to my surprise i actually gained a little . Further more early last year i withdrew a sum to purchase the van . Again several adjustments were made , and a later review at christmas showed my investment's , had almost recouped half that sum back .

In complete contrast , my brother , who also opted out of serp's , five years later than me , was advised by his FA to return to the government system and now doesn't know if he will ever be able to retire .
 

Langtoftlad

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As far as I am concerned an ISA is of no use anymore with the new "interest tax free " rules.
Well don't be in such a rush to ditch the ISA wrapper...
It protects you from other taxes such as Capital Gains as well as just "interest".
Depending on your level of savings/investments/pension funds the £1000 tax free interest band may not be enough - especially if rates rise significantly.

Pensions are tax free paying into, but you pay tax on the proceeds, and the rules are strict...
ISA's are from tax paid income but the proceeds are tax free and you have completely free flexibility how to use them.

Both have a place in your finances.
Diversification is key.

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