Pete started watching your videos recently. been going through the whole retirement, pension pot, transfer and investment with F.A.for past few months. Video is very informative and reassuring
Charlie Munger's advice regarding employing a FA is to educate yourself before hand so that you can ask intelligent questions and to always remember you are speaking to someone who has a financial interest in talking with you. You can't go wrong with Charlie's advice.
In my experience not enough FA are objective and advise their clients to take control of their finances to save fees, If you understand the different buckets of money and risk associated with them e.g. 3-5 years low risk investment in case the market crashes etc. and you have access to investment platforms like vanguard and the FA have already provided advice on the overall strategy to retirement funding, why continue to pay yearly for the same advise? When would you advise your clients to take control of their finances to save fees?
Often. Depends on the client as many do not want to take control. For them, they fees are worth it to have someone take on that responsibility. But for context, more than half of my clients come to me for planning, then implement and manage themselves.
Ad Valorum adviser charges are the challenge I think, more than an objection to ongoing fee’s from clients. Particularly around ‘at retirement’ where a £1m of pension/isa assets could be £10k+ per year… While recognising this may be good value for the initial drawdown set up & plan and then later for some IHT work, it’s tough to see value every year at that level over say 25 years… particularly if the Investment management is outsourced to a DFM or passive. Transactional advice and charging (and liability) as you would get from a solicitor will be a valuable offering to future clients who are more clued up or even qualified (like people who watch you tube videos like this one every day) who just want to hand off the tricky bits and self serve the rest. For some/many total hands off hand it all to an adviser is still a great option, but I think we’ll need more consumer choice in future. I don’t think the regulatory environment or liability structure around advice are very supportive of this currently. Great Chanel thanks for the great work, keep it up! All views my own.
I totally agree with you on all points. For some, handing everything off to an adviser is the right thing to do and they’re happy to most for it. But more and more people are educating themselves to a good level and don’t need an adviser to handle the basics.
Why don’t financial advisors charge an hourly rate , I saw an advisor ,his advice was do not use him as his charges were £12,000 How many hours work was that
Some do. Most clients don’t like it, but we do work that way for some clients. The problem is that to cover the instance oats of regulation we’d have to charge a monumental hourly rate, like hundreds of pounds an hour. It pains me, it really does, but we’re running a business and have to make profit. Percentage fees and project fees seem to be the most acceptable way to charge from our clients’ point of view. Good question though - thanks for asking it…
Being self employed for the last 40 years I appreciate the value of a reliable income stream which has not always bean possible for me. Therefore I also appreciate how valuable of a regular fee to my FA is. I do accept the 0.5% fee per year that I am charged, not much in the first few year granted but this is now a considerable amount of money. What I find unacceptable is that when I am now trying to retire and organise my pension I am being asked for an additional payment of between 2.5 and 3% of the fund value. For most people when we retire we now have to live within your mean provided by this limited pot. You wont be making any further contribution and more importantly what your FA should recognise is that it is not a lottery win for them to dip into. This is hard earned cash that has been put aside for later years. You wonder why people don't get adequate or any financial advise, try thinking about these huge charges the financial sector take from there customers point of view. Where is the loyally to the customer rather than just charging what you think the market can stand. Sorry to be so negative in response to your constructive and helpful video however we the customer don't deserve to be treated in this way!
I've been looking more and more into FA recently but discovering this has disappointed me. Seeing as most of the financial advice offered online is really quite simple it doesn't seem to make sense being charged yearly. If you go into such an arrangement, how and when does it even end?
I have it in my head,that if Banks take care of my money they should provide finacial planning in return....but im probably very cautious and carful ith my money,what kind of fees are we talking?...A savings account,healthy pension pot,and a current account for daily monthly use...its a mind field trying to know where to put money..
Depends on what you need really, and financial planners’ fees differ based on your needs and their location. You might find this podcast episode useful: meaningfulmoney.tv/2021/05/04/the-financial-advice-checklist/
Depends on what you need really, and financial planners’ fees differ based on your needs and their location. You might find this podcast episode useful: meaningfulmoney.tv/2021/05/04/the-financial-advice-checklist/
I really like your channel, like the way you give advice, but have you no convinced me? No. Absolutely not. Yes a FA may give useful advice at the start, but once things are set up he/she has pretty much buggerall to do and they want 1% of the assets every year for that!?? Absolutely no chance I would sign up to such an agreement. Several years ago a friend of mind signed up to such a deal, was loosing £3,500 of her hard-earned every single year to this FA who had simply slapped her pension into LV (quite literally he was doing FA) and left it there and many of her funds were returning less than 5% and in fact 2 had made losses spanning the last 5 years .... that is not VFM for me. For me if I feel I need advice it's a one-off fee or no deal.
Why don't financial advisors get paid on results....For example a percentage of wealth generated. is it because they want a chunk of your money in spite of poor performance or advice?
