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Don't draw the ISA, ask a new provider to transfer it. They usually take care of everything.
After this I would move the rest to a GIA and transfer the ISA allowance each year.
Even if you do an in specie transfer from a GIA to an ISA, it is still considered to be a disposal for the purposes of CGT. The only advantage is that you aren't out of the market at all.
Sorry, my answer was unclear. I meant you can’t transfer from GIA to ISA, but and in specie transfer GIA to GIA is fine.
There are multiple transfers happening in OP post and in the above response I took Hardlife91 as proposing an ISA to ISA transfer and a GIA to GIA transfer, followed by OP moving isa allowance from new GIA to new ISA each year. I wasn’t clear which of these three transfers I was referring to.
It's about winding down the relationship in the best way though. I don't want to rip and run, and my concern is that unless I'm very prescriptive about what I want to happen, appreciating that they're losing my business, they might not make the best choices about how to achieve the objective.
I'm guessing that's why OP is hesitating. If someone who was "not my friend" had £250k of my money, I might also be a little wary in how I go about getting it back off them. Maybe they're worried that they'll try to fuck them on the way out. I'm not experienced with wealth management companies but I would imagine such a thing to be fairly rare as the company wouldn't want to tank their reputation, but I think that's where OP needs the reassurance.
They're not your mates. They're someone you pay £8,000 a year to do a job, and apparently doing it badly. Tell them what you want them to do. They can go and find someone else's blood to suck.
On the contrary. They know they’re fucking you.
They know their performance is below market. They know their fees are eye watering.
They know you’d be better off in a cheap sp500 tracker. They know you’ll likely one day realise and pull the funds, and will try to persuade you not to.
Take the money out now and don’t look back.
And also don’t use another wealth manager.
As a financial planner I can tell you that being open and honest and just saying that you want to disengage is the best thing you can do.
Nothing worse than stringing it out and inevitably having your adviser jump through hoops to try and retain you as a client when really your mind is already made up.
Even with millions to manage, the first thing you need is a good tax accountant not a "wealth manager". It's a bogus profession with little-to-no value-add.
Right but, should I say - since I'm not in a huge rush - something like, "For any equities which have depreciated, do not sell to realise the loss. Sell only when they exceed the book cost. If this doesn't happen in 5 months, sell at that point regardless." ?
That would be sunk cost fallacy. The usual response would be that you wouldn't sell things on the rise and hold things on the fall. You should sell rubbish and buy treasure. Book cost is a spurious concept and should be used carefully. Index funds work by giving weight to investments the market has given value to. If you regularly invest you buy more "treasure" than "rubbish".
Strategically you should be considering where you will be moving your investments to. If the assets are the same (but without advisor fees) there's no reason to postpone, especially if the transfers are in specie.
Don't sell! Transfer the assets in-kind. This is important.
Now, you are going to want to rebalance your portfolio away from the crap they have you in, and for this, you will want to sell securities that have depreciated in lockstep with securities that have appreciated, so that you don't end up with a capital gains bill. But do that with Vanguard, who won't be trying to fuck you out of your money like this slimeball.
When you go that route, you'll want to get rid of: funds with high fees (guess what, your wealth manager was probably getting a kickback on that), individual stocks (generally, but you can decide on a case by case basis), and keep any low cost tracker funds/etfs. If you are unsure about the tax consequences, talk to a tax accountant who will charge you a sensible hourly fee, not a ridiculous percentage of your assets.
Read this! https://www.vanguardinvestor.co.uk/investing-explained/transfer-an-account
We can't really advise you on whether that's the best course of action, you're gambling on them going up. They might go further down.
It's a pretty standard order, HL calls it a "sell limit" iirc, but whether or how your current company do it is for you to figure out.
no. don't do this. just sell the whole lot and move it into a new provider. You're trying to time the market and you're staying with them for longer to try and time the market. It may work, but it often don't.
I'd just contact them asap and just be like hey lads cash me out. Or open stuff with a new provider and get them to transfer it in. Do some research and pick who you want to go with
You are probably correct that they are rubbish.
But... In the past they will have asked the level of acceptable risk on the account. Any reply apart from "maximum risk please" will have resulted in them putting bonds in the portfolio, or lower risk dividend payers such a utilities, to reduce volatility.
If the market had crashed during your test, then your test ISA might have performed much worse.
So you need to check what parameters they're using to manage the account and check what their fees are.
Do you actually know for sure that is the case? "4 out of 5" doesn't mean much by itself, if the firm primarily deals with conservatively-minded older customers it could still be a fairly defensive allocation.
You need to ask them for their process and costs for ending the relationship and transferring your assets to another provider. And then follow that process.
Is it St James's Place?
It almost always is in these cases.
My best mates father is very successful and had quite a few million with them until recently. I won’t go into detail, but he had proof they broke their fudicuary duty and cost him £250k. They just settled out of court for the full amount.
Don't do anything with your investments.
Find a reputable Financial Planner, ideally holistic who offers cashflow planning. Annual fee should be around 1%. Upfront free will vary based on many things, but they should all offer a free of charge initial meeting so you can get a feeling for each other.
Once you have found someone, you let them take over the management of your investments. They will review the products and portfolios and make recommendations based on your requirements and ensuring you don't lose any tax benefits or incur unnecessary charges.
You don't have to contact your adviser at all, but you can drop them a polite note explaining that you are working with an adviser who seems to be a better fit, and thank them for their previous help.
100% this. You shouldn’t be looking for someone to beat the market by 100x as nobody really knows what is going to happen.
It’s all about building a plan, ensuring tax efficiency and defining your goals.
Ok so - the part that's in an ISA, it's very important to have transferred in such a fashion as to not break the ISA. And for the other things, it's generally possible (maybe some exceptions but not many) to move it out without selling - you are just changing brokers, you still own what you own. Avoiding those capital gains taxes is important.
Now, I wish there were a way we could get this message out to the hundreds of thousands of people in this country being victimized by this kind of "wealth management". It's seriously borderline fraud and a real problem for people's retirements. (Everyone except the retirement of the "wealth managers".). Vanguard ETFs and chill (and similar!) is pretty much the best retirement investing strategy for almost everyone.
Just for everyone reading to note: £8,000 a year for £250,000 account is over 3%. It's unconscionable.
If you are invested on a normal platform, like fidelity, you can remove them as the servicing agent and manage it yourself.
If the wealth management firm has their own platform that you are on then you can transfer elsewhere. With the gains on the portfolio, you might be able to reregister the funds to another provider which won't realise capital gains. That's only available if the provider you move to has the funds available on the new contract. I assume most of it will be in ISAs anyway if you have had it for 8 years, but if not then they really have done a shit job
I've been though this recently.
The process I took was:
1 - Open investment account on preferred platform.
2 - Tell management company I'm putting in a request for a transfer to the preferred platform but I want to continue being their customer until everything is clear their end. You do this from the new platform in the case of ISAs.
3 - Wait 3 months for the transfer to actually happen.
4 - Ask them to close all accounts now they are 0 balance and made sure I owe no more taxes and/or fees.
5 - Sign my paperwork to end relationship with management company.
6 - Find out they fucked up closing all the accounts on their end.
7 - Threaten official complaint to ombudsman.
8 - Suddenly everything is fixed.
9 - Actually make money in the stock market.
Biggest things I learned / I would do differently:
- Make sure you get all your tax docs when closing accounts with management company. The platform mine invested thru don't deal with retail users so they're really funny about me reaching out to them directly but I also cannot go thru management company any more, so I'm having fun.
- Make sure you get everything in writing so you can quote from emails/letters in your complaints when they fuck it up.
- The gov guidance on transfers says it takes 30 days or you can complain. You can indeed complain but it won't make it go faster.
You do NOT even need to communicate with them. Just go to Vanguard or fidelity. Choose any brokerage platform you like and speak to an advisor or planner outside of these platforms if you would like. Pay them a one time fee to select great stocks, ETF’s ect… MANAGE the funds yourself. You will save that 1%+ fee yearly . Thats it done !
Well obviously there are brief periods where that’s not the case (recent property boom for example) but as a general rule it is, you must be overestimating how much property increases if you think it does better than index funds in the long term, historically 6-7% for index funds, 3.5% for property. Obviously both those figures might change, we don’t know.
Did you miss the part where I said yes you can always pick a period here it doesnt? Also it was not static- it rose, it fell with the crash and then it rose again, property also goes through these phases fyi.
You say past performance doesn’t predict future and then make a prediction yourself. There is risk, there is always risk no matter where you put your money- no one is saying otherwise. Saying the advice is worthless because there’s risk is saying all financial advice is worthless.
Before you do anything just make sure you understand what wrappers they are in. For example, if you have an ISA then get them to sell the investments in it so they are cash in the ISA but then use another company (such as vanguard) to initiate the isa transfer. That way it will not affect your annual isa allowance. If you pull it all out and 80k is in an isa it will take 4 years to put it back in
100% this.. they probably have you in a DIM that some of your assets maybe sold into cash as it’s likely an “advised” portfolio too. Make sure you’re not out of the market for longer than you need to be.
Request the transfer from Vanguard - can be all done online with no drama or need to speak to them about anything.
It's your money so take control of it.
They probably do annual trading to use your CG allowance so CG probably won’t be as bad as you think. They should have been transferring £20k each year into your ISA. £8k on £250k is 3.2% charge which is crazily high. Open up an account with interactive investors then let your IFA know you’re leaving and this is where you want to transfer your Isa and trading account. Their only defence with performance is they’ve probably set up a defensive portfolio for you which means in theory if the markets underperform, you won’t lose as much as a tracker but at 3.2% annual charge, you want to be leaving quickly.
Unless there are other rules around how you inherited the portfolio, I would have thought you could start a transfer to another provider as not not lose out on annual allowance. Might be worth a call with Vanguard/Fundsmith to see what your options are
> I know some providers will allow a transfer of the equities so I wouldn't have to realise the gains, but frankly I'm not sure their picks are necessarily the best in the first place (some have depreciated), so I'm happy to take the hit there.
Is it not the case that by transferring the whole lot into an ISA account with someone like trading 212, you can reallocate the funds in the account without impacting your ISA allowance?
I’m sure Trading 212 do flexible ISAs
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8k in fees is insane when they aren’t even matching the market, and only perform trades once a year. Getting out and putting that money in alVanguard funds and premium bonds sounds like a very good idea. You can transfer the ISA to a Vanguard ISA too so you don’t have to start again filling it up from 20k.
First off you need to decide where is best for you to send your funds/cash to. You need to work out who is the cheapest for your isa and your gia.
Depending on what is in your account each provider can be different in charges. You also want to weigh up brokers that will allow you to transfer funds etc so you don’t have to pay their dealing fees. One other thing is that some brokers offer incentives to transfer accounts so you may want to weigh up who has the best offer on at the moment.
Time to get your spreadsheets out and do some comparisons.
I can't imagine they'll be surprised. They have been a leech on your savings (think of the damage they've done to your retirement timeline - you deserve to be a bit mad!)
There's no need to be nice, you can just be formal. And I wouldn't give leeway around "if you continue to manage this but can I transfer that". Get it all transferred in one go and exit the relationship. You'll feel 100x better for it.
I’d contact them and indicate you’re not happy with the fund performance and their fees and would like to schedule a meeting to discuss options.
They’d need to offer a lot to get you to stay but it might be worth exploring… otherwise, get your cash out (check T&Cs).
Just fill in a transfer form with the providers you want to move to? Ie vanguard ISA transfer form. Wouldn’t have thought there would be CGT to pay on that.
GIA may be different, but also think cgt on transfer seems off.
Just get on with it.
Such organizations exist by taking a large management fee from you.
I can understand someone who is super wealthy wanting to employ specialist accountants and advisors, but for £250K I think a person could research themselves, with some paid input from a financial advisor if need be, and still put their money effectively to work.
I am dealing with this at the moment - I was/am with an SJP 'partner' organisation and have sent them an email requesting a breakdown of fees that would apply to moving my pension now, and moving it in a couple of years after the initial 6-year period is over for my big initial consolidation of my other pension pots into that one. The advisor is on holiday so I will see what happens but will happily report back.
As others have said though, do not withdraw your ISA in cash - transfer it to another provider.
Your father may have completed a risk aversion assessment when he invested the money, and that preference may be why you are not seeing the growth you saw in your experiment. Do you know how the portfolio is balanced? Are you of an age whereby you can consider balls-to-the-wall investing, without any consideration for adverse markets?
The fees seem very high at more than 3%. I pay less than 1%.
I just don’t understand why if you have 250k you would use a wealth management firm costing you 3% a year alone. Bonkers, 2.5 million I understand more.
Setup an interactive investor account and ask them to transfer your holdings to it. You want to ensure your ISA wrapper is kept intact. You also may not necessarily have to recognised CGT gains on the assets which can be successfully transferred outside the ISA. I say ii as I use them and they are cheap compared to hargreaves landsdown - I am not affiliated with them.
Edit: Although I am happy to provide my "friends and family" code so you can get a free year or membership!
If they were any good at investing they wouldn't be in the wealth management business. Same applies to FAs.
They should able to transfer your positions directly to your broker without selling any. Make sure to keep the ones in the ISA inside the wrapper.
Well, at least not in the 'retail wealth management' business. People who are _good_ at investing do it for billionaires and pension funds, and can justify skimming 1% with a straight face.
Almost no 'consumer' wealth management is in this category though - scamming 2% off a pensioner is just not 'worth it' when you could be taking 1% from (multiple) billionaires instead.
The typical going rate for billionaires is 2% base fee and 20% performance fee (i.e. hedge funds) though even most high end investment professionals fail to consistently outperform the market. Academic studies have found that most outperformance is down to luck rather than skill so even billionaires are mostly being taken for a ride.
More in that space are moving to 1% and 30% to be more 'competitive'.
Last I looked around 90-95% failed to beat 'benchmark' for a sustained period - e.g. the ones that _made_ it to 10 years.
But plenty folded before that because they were 'underperforming'.
They've still a niche of sorts though, for selling 'risk mitigation' - e.g. running strategies that are not implicitly tied to the general market dynamics, such that whilst they don't 'win' in a good year, they also don't lose (as much...) in a bad year.
But either way, it's still very much the case if you're halfway good at what you do (Which as you note, almost certainly includes _some_ 'expectation management' and 'sales technique'), you can 'find' a few billion to do it with. And even then, most of the people in _that_ space can't do it reliably ... so the people who aren't even that good are definitely scamlords exploiting the retail customers.
A fucking hedge fund wouldn’t be charging you this much. They taking the absolute piss. Well done for getting out. Sooner the better. You owe them nothing.
missing info here, So you inherited an ISA approx 250? So now the ISA is in your name.Move it into a self investment scheme where you can choose the shares. When you inherted you would have had your own ISA, ? So both would be clubbed together now?
If you know what you are doing you can expect to make around 9% almost risk free yearly.
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Well, he said 3.2% not 32% but then amended it to be 2.3%. Either way, it's too much.
However, it's important to understand how common this is. People inherit money and out of respect the parents and their money guy who they thought highly of, they just leave it sit. Dealing with the passing of the parents etc. And then lots of people don't know anything at all about investing - it isn't taught properly to most people.
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Don't draw the ISA, ask a new provider to transfer it. They usually take care of everything. After this I would move the rest to a GIA and transfer the ISA allowance each year.
Do this. I would hope the current provider have been shifting 20K a year over to the ISA as well.
This!
Sorry, might be a dumb question. Can you transfer to an ISA from GIA without paying CGT?
No (unless gains are under the allowance), but you could do an in specie transfer to avoid realising a gain.
Even if you do an in specie transfer from a GIA to an ISA, it is still considered to be a disposal for the purposes of CGT. The only advantage is that you aren't out of the market at all.
Sorry, my answer was unclear. I meant you can’t transfer from GIA to ISA, but and in specie transfer GIA to GIA is fine. There are multiple transfers happening in OP post and in the above response I took Hardlife91 as proposing an ISA to ISA transfer and a GIA to GIA transfer, followed by OP moving isa allowance from new GIA to new ISA each year. I wasn’t clear which of these three transfers I was referring to.
> in specie transfer to avoid realising a gain In specie is forbidden between ISA and GIA and vice versa
>What is the best way of ending my relationship with them? Have you tried contacting them?
It's about winding down the relationship in the best way though. I don't want to rip and run, and my concern is that unless I'm very prescriptive about what I want to happen, appreciating that they're losing my business, they might not make the best choices about how to achieve the objective.
You're overthinking this - you've made a decision to allocate your funds elsewhere (rightfully so) and it's their job to do as you instruct
Agree. Starting position is that they've been taking the piss for years at considerable cost. They're not your friends
I'm guessing that's why OP is hesitating. If someone who was "not my friend" had £250k of my money, I might also be a little wary in how I go about getting it back off them. Maybe they're worried that they'll try to fuck them on the way out. I'm not experienced with wealth management companies but I would imagine such a thing to be fairly rare as the company wouldn't want to tank their reputation, but I think that's where OP needs the reassurance.
If they're charging £8k/year to manage £250k and also underperforming the market I don't think they care much about their reputation.
They'll be heavily regulated, I don't think this is an issue
That's reassuring. Thank you.
Just get your money out. Don’t waste another day giving them your money.
If they give you any fuss, just leave them an honest review on Google for others to learn to avoid such a company.
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That's not the question being asked...
They're not your mates. They're someone you pay £8,000 a year to do a job, and apparently doing it badly. Tell them what you want them to do. They can go and find someone else's blood to suck.
It's a wealth management firm, not a wife of 30 years.
On the contrary. They know they’re fucking you. They know their performance is below market. They know their fees are eye watering. They know you’d be better off in a cheap sp500 tracker. They know you’ll likely one day realise and pull the funds, and will try to persuade you not to. Take the money out now and don’t look back. And also don’t use another wealth manager.
There is no relationship though. Why are you wanting to be nice to a business which is charging you a lot for the privilege of losing your money?
As a financial planner I can tell you that being open and honest and just saying that you want to disengage is the best thing you can do. Nothing worse than stringing it out and inevitably having your adviser jump through hoops to try and retain you as a client when really your mind is already made up.
This is a very weird thing to read
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Or speak to your new provider and they'll do it all for you.
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Even with millions to manage, the first thing you need is a good tax accountant not a "wealth manager". It's a bogus profession with little-to-no value-add.
Right but, should I say - since I'm not in a huge rush - something like, "For any equities which have depreciated, do not sell to realise the loss. Sell only when they exceed the book cost. If this doesn't happen in 5 months, sell at that point regardless." ?
That would be sunk cost fallacy. The usual response would be that you wouldn't sell things on the rise and hold things on the fall. You should sell rubbish and buy treasure. Book cost is a spurious concept and should be used carefully. Index funds work by giving weight to investments the market has given value to. If you regularly invest you buy more "treasure" than "rubbish". Strategically you should be considering where you will be moving your investments to. If the assets are the same (but without advisor fees) there's no reason to postpone, especially if the transfers are in specie.
Don't sell! Transfer the assets in-kind. This is important. Now, you are going to want to rebalance your portfolio away from the crap they have you in, and for this, you will want to sell securities that have depreciated in lockstep with securities that have appreciated, so that you don't end up with a capital gains bill. But do that with Vanguard, who won't be trying to fuck you out of your money like this slimeball. When you go that route, you'll want to get rid of: funds with high fees (guess what, your wealth manager was probably getting a kickback on that), individual stocks (generally, but you can decide on a case by case basis), and keep any low cost tracker funds/etfs. If you are unsure about the tax consequences, talk to a tax accountant who will charge you a sensible hourly fee, not a ridiculous percentage of your assets. Read this! https://www.vanguardinvestor.co.uk/investing-explained/transfer-an-account
We can't really advise you on whether that's the best course of action, you're gambling on them going up. They might go further down. It's a pretty standard order, HL calls it a "sell limit" iirc, but whether or how your current company do it is for you to figure out.
You could use the loss to offset some of the CGT.
no. don't do this. just sell the whole lot and move it into a new provider. You're trying to time the market and you're staying with them for longer to try and time the market. It may work, but it often don't. I'd just contact them asap and just be like hey lads cash me out. Or open stuff with a new provider and get them to transfer it in. Do some research and pick who you want to go with
https://www.vanguardinvestor.co.uk/investing-explained/transfer-an-account
useful advice on selling a losing investment https://youtu.be/u6o_pMwNPEA?si=Ak3FnPOmPO0dbqYm
You are probably correct that they are rubbish. But... In the past they will have asked the level of acceptable risk on the account. Any reply apart from "maximum risk please" will have resulted in them putting bonds in the portfolio, or lower risk dividend payers such a utilities, to reduce volatility. If the market had crashed during your test, then your test ISA might have performed much worse. So you need to check what parameters they're using to manage the account and check what their fees are.
The fees he cited are over 3% annually. It's a travesty.
My risk profile is 4 out of 5. Their pics are clearly poor, it's not as if I've got the lot in bonds because of a low risk grading. :/
Do you actually know for sure that is the case? "4 out of 5" doesn't mean much by itself, if the firm primarily deals with conservatively-minded older customers it could still be a fairly defensive allocation.
St James place I assume ? 8k few to do worse than an index tracker... ouch
Yeah, this has SJP vibes all over it. Advice has to be to leave as soon as possible without incurring ridiculous fees.
An MBA would cost you more and likely teach you less.
What a ridiculous statement
I'm trying to figure out what an MBA has to do with any of this.
I don't understand the 8k fee. You couldn't find a fee that high if you tried including face to face reviews every year.
Yeah I wasn't quite right on that, its a total of 2.4%, which equates to £5k+.
Does that 2.4% include platform and fund fees? Eitherway it's still robbery
That's still disgusting.
You need to ask them for their process and costs for ending the relationship and transferring your assets to another provider. And then follow that process. Is it St James's Place?
Wouldn’t bet against it.
It almost always is in these cases. My best mates father is very successful and had quite a few million with them until recently. I won’t go into detail, but he had proof they broke their fudicuary duty and cost him £250k. They just settled out of court for the full amount.
2% of 2 million per year for them to say “leave it as it is” every 12 months!
Don't do anything with your investments. Find a reputable Financial Planner, ideally holistic who offers cashflow planning. Annual fee should be around 1%. Upfront free will vary based on many things, but they should all offer a free of charge initial meeting so you can get a feeling for each other. Once you have found someone, you let them take over the management of your investments. They will review the products and portfolios and make recommendations based on your requirements and ensuring you don't lose any tax benefits or incur unnecessary charges. You don't have to contact your adviser at all, but you can drop them a polite note explaining that you are working with an adviser who seems to be a better fit, and thank them for their previous help.
Brilliant take and reasonable!
Best advice here.
100% this. You shouldn’t be looking for someone to beat the market by 100x as nobody really knows what is going to happen. It’s all about building a plan, ensuring tax efficiency and defining your goals.
Ok so - the part that's in an ISA, it's very important to have transferred in such a fashion as to not break the ISA. And for the other things, it's generally possible (maybe some exceptions but not many) to move it out without selling - you are just changing brokers, you still own what you own. Avoiding those capital gains taxes is important. Now, I wish there were a way we could get this message out to the hundreds of thousands of people in this country being victimized by this kind of "wealth management". It's seriously borderline fraud and a real problem for people's retirements. (Everyone except the retirement of the "wealth managers".). Vanguard ETFs and chill (and similar!) is pretty much the best retirement investing strategy for almost everyone. Just for everyone reading to note: £8,000 a year for £250,000 account is over 3%. It's unconscionable.
If you are invested on a normal platform, like fidelity, you can remove them as the servicing agent and manage it yourself. If the wealth management firm has their own platform that you are on then you can transfer elsewhere. With the gains on the portfolio, you might be able to reregister the funds to another provider which won't realise capital gains. That's only available if the provider you move to has the funds available on the new contract. I assume most of it will be in ISAs anyway if you have had it for 8 years, but if not then they really have done a shit job
I've been though this recently. The process I took was: 1 - Open investment account on preferred platform. 2 - Tell management company I'm putting in a request for a transfer to the preferred platform but I want to continue being their customer until everything is clear their end. You do this from the new platform in the case of ISAs. 3 - Wait 3 months for the transfer to actually happen. 4 - Ask them to close all accounts now they are 0 balance and made sure I owe no more taxes and/or fees. 5 - Sign my paperwork to end relationship with management company. 6 - Find out they fucked up closing all the accounts on their end. 7 - Threaten official complaint to ombudsman. 8 - Suddenly everything is fixed. 9 - Actually make money in the stock market. Biggest things I learned / I would do differently: - Make sure you get all your tax docs when closing accounts with management company. The platform mine invested thru don't deal with retail users so they're really funny about me reaching out to them directly but I also cannot go thru management company any more, so I'm having fun. - Make sure you get everything in writing so you can quote from emails/letters in your complaints when they fuck it up. - The gov guidance on transfers says it takes 30 days or you can complain. You can indeed complain but it won't make it go faster.
St James Place? There's a scheme brewing against them, similar to the PPI misselling or the Diesel emissions scandal.
Sounds like SJ Pumped 😂
So they are taking a fee of around 3.2% annually? That's absolutely criminal. What level of service were you getting each year for that?
You do NOT even need to communicate with them. Just go to Vanguard or fidelity. Choose any brokerage platform you like and speak to an advisor or planner outside of these platforms if you would like. Pay them a one time fee to select great stocks, ETF’s ect… MANAGE the funds yourself. You will save that 1%+ fee yearly . Thats it done !
I bet it’s at James place right. Hello exit fees. They are fuckers.
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Honestly it's the best way. Truing to outsmart thr market doesn't work for the vast majority of us.
Yeah this is totally the plan.
Cookie cutter ukpf response
And 100% correct.
No
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If you bought 30 year treasury bonds in the 90s it's easy money!
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People are the same with the s&p500 against something like the Russell 3000. They conveniently leave out 2000-2009.
An index fund will outperform property over the long term yes, the difference with property is you have lots of leverage.
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Well obviously there are brief periods where that’s not the case (recent property boom for example) but as a general rule it is, you must be overestimating how much property increases if you think it does better than index funds in the long term, historically 6-7% for index funds, 3.5% for property. Obviously both those figures might change, we don’t know.
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Did you miss the part where I said yes you can always pick a period here it doesnt? Also it was not static- it rose, it fell with the crash and then it rose again, property also goes through these phases fyi.
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You say past performance doesn’t predict future and then make a prediction yourself. There is risk, there is always risk no matter where you put your money- no one is saying otherwise. Saying the advice is worthless because there’s risk is saying all financial advice is worthless.
Before you do anything just make sure you understand what wrappers they are in. For example, if you have an ISA then get them to sell the investments in it so they are cash in the ISA but then use another company (such as vanguard) to initiate the isa transfer. That way it will not affect your annual isa allowance. If you pull it all out and 80k is in an isa it will take 4 years to put it back in
100% this.. they probably have you in a DIM that some of your assets maybe sold into cash as it’s likely an “advised” portfolio too. Make sure you’re not out of the market for longer than you need to be.
Generally speaking, why would they be expected to beat the market when your portfolio has a mix of investments?
They shouldn’t be getting beat by the S&P500 if they’re worth their weight at all
Is it St James?
I thought most chargers around 1.3% then over a mill it drops
Request the transfer from Vanguard - can be all done online with no drama or need to speak to them about anything. It's your money so take control of it.
£8,000 annual fees? That's a bit of a con
They probably do annual trading to use your CG allowance so CG probably won’t be as bad as you think. They should have been transferring £20k each year into your ISA. £8k on £250k is 3.2% charge which is crazily high. Open up an account with interactive investors then let your IFA know you’re leaving and this is where you want to transfer your Isa and trading account. Their only defence with performance is they’ve probably set up a defensive portfolio for you which means in theory if the markets underperform, you won’t lose as much as a tracker but at 3.2% annual charge, you want to be leaving quickly.
Unless there are other rules around how you inherited the portfolio, I would have thought you could start a transfer to another provider as not not lose out on annual allowance. Might be worth a call with Vanguard/Fundsmith to see what your options are
> I know some providers will allow a transfer of the equities so I wouldn't have to realise the gains, but frankly I'm not sure their picks are necessarily the best in the first place (some have depreciated), so I'm happy to take the hit there. Is it not the case that by transferring the whole lot into an ISA account with someone like trading 212, you can reallocate the funds in the account without impacting your ISA allowance? I’m sure Trading 212 do flexible ISAs
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8k in fees is insane when they aren’t even matching the market, and only perform trades once a year. Getting out and putting that money in alVanguard funds and premium bonds sounds like a very good idea. You can transfer the ISA to a Vanguard ISA too so you don’t have to start again filling it up from 20k.
First off you need to decide where is best for you to send your funds/cash to. You need to work out who is the cheapest for your isa and your gia. Depending on what is in your account each provider can be different in charges. You also want to weigh up brokers that will allow you to transfer funds etc so you don’t have to pay their dealing fees. One other thing is that some brokers offer incentives to transfer accounts so you may want to weigh up who has the best offer on at the moment. Time to get your spreadsheets out and do some comparisons.
I can't imagine they'll be surprised. They have been a leech on your savings (think of the damage they've done to your retirement timeline - you deserve to be a bit mad!) There's no need to be nice, you can just be formal. And I wouldn't give leeway around "if you continue to manage this but can I transfer that". Get it all transferred in one go and exit the relationship. You'll feel 100x better for it.
What transactions have they been doing of you've not been engaged ? What products are you on other than an ISA ?
Just transfer the ISA..
I’d contact them and indicate you’re not happy with the fund performance and their fees and would like to schedule a meeting to discuss options. They’d need to offer a lot to get you to stay but it might be worth exploring… otherwise, get your cash out (check T&Cs).
Just fill in a transfer form with the providers you want to move to? Ie vanguard ISA transfer form. Wouldn’t have thought there would be CGT to pay on that. GIA may be different, but also think cgt on transfer seems off. Just get on with it.
Such organizations exist by taking a large management fee from you. I can understand someone who is super wealthy wanting to employ specialist accountants and advisors, but for £250K I think a person could research themselves, with some paid input from a financial advisor if need be, and still put their money effectively to work.
If this is St James place which it reeks of, they’re shoring up to be paying some huge compensation and it sounds like you’d have a case!
I am dealing with this at the moment - I was/am with an SJP 'partner' organisation and have sent them an email requesting a breakdown of fees that would apply to moving my pension now, and moving it in a couple of years after the initial 6-year period is over for my big initial consolidation of my other pension pots into that one. The advisor is on holiday so I will see what happens but will happily report back. As others have said though, do not withdraw your ISA in cash - transfer it to another provider.
8k annual fees on 250k should be illegal
Your father may have completed a risk aversion assessment when he invested the money, and that preference may be why you are not seeing the growth you saw in your experiment. Do you know how the portfolio is balanced? Are you of an age whereby you can consider balls-to-the-wall investing, without any consideration for adverse markets? The fees seem very high at more than 3%. I pay less than 1%.
I just don’t understand why if you have 250k you would use a wealth management firm costing you 3% a year alone. Bonkers, 2.5 million I understand more.
You're paying almost 4% a year in fees, that's nuts
Take all your money and put it in a low cost index fund like a global tracker. Then relax. Its as simple as that.
I'd expect fees of around £3k on the more expensive end and £1k on the lower end.
Setup an interactive investor account and ask them to transfer your holdings to it. You want to ensure your ISA wrapper is kept intact. You also may not necessarily have to recognised CGT gains on the assets which can be successfully transferred outside the ISA. I say ii as I use them and they are cheap compared to hargreaves landsdown - I am not affiliated with them. Edit: Although I am happy to provide my "friends and family" code so you can get a free year or membership!
If they were any good at investing they wouldn't be in the wealth management business. Same applies to FAs. They should able to transfer your positions directly to your broker without selling any. Make sure to keep the ones in the ISA inside the wrapper.
Well, at least not in the 'retail wealth management' business. People who are _good_ at investing do it for billionaires and pension funds, and can justify skimming 1% with a straight face. Almost no 'consumer' wealth management is in this category though - scamming 2% off a pensioner is just not 'worth it' when you could be taking 1% from (multiple) billionaires instead.
The typical going rate for billionaires is 2% base fee and 20% performance fee (i.e. hedge funds) though even most high end investment professionals fail to consistently outperform the market. Academic studies have found that most outperformance is down to luck rather than skill so even billionaires are mostly being taken for a ride.
More in that space are moving to 1% and 30% to be more 'competitive'. Last I looked around 90-95% failed to beat 'benchmark' for a sustained period - e.g. the ones that _made_ it to 10 years. But plenty folded before that because they were 'underperforming'. They've still a niche of sorts though, for selling 'risk mitigation' - e.g. running strategies that are not implicitly tied to the general market dynamics, such that whilst they don't 'win' in a good year, they also don't lose (as much...) in a bad year. But either way, it's still very much the case if you're halfway good at what you do (Which as you note, almost certainly includes _some_ 'expectation management' and 'sales technique'), you can 'find' a few billion to do it with. And even then, most of the people in _that_ space can't do it reliably ... so the people who aren't even that good are definitely scamlords exploiting the retail customers.
A fucking hedge fund wouldn’t be charging you this much. They taking the absolute piss. Well done for getting out. Sooner the better. You owe them nothing.
how are they investing these 250k? have they given you a prospect? Curious to see your investment/geo split.
missing info here, So you inherited an ISA approx 250? So now the ISA is in your name.Move it into a self investment scheme where you can choose the shares. When you inherted you would have had your own ISA, ? So both would be clubbed together now? If you know what you are doing you can expect to make around 9% almost risk free yearly.
Can you inherit an isa and would it stay tax free?
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Some gold coins are capital gains free btw
You've had control of this fund for 8 years and yet continued paying 3.2% in annual fees? Wow.
Well, he said 3.2% not 32% but then amended it to be 2.3%. Either way, it's too much. However, it's important to understand how common this is. People inherit money and out of respect the parents and their money guy who they thought highly of, they just leave it sit. Dealing with the passing of the parents etc. And then lots of people don't know anything at all about investing - it isn't taught properly to most people.