REPLACE - Advice - h1

1. What is advice?
2. Benefits & disadvantages of advice
3. Is advice right for you?
4. Advisers
5. Advised portfolios
6. Charges

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Financial Planner
Investment Manager
Support team

Often financial planner + investment manager
Wealth management: Comined financial planning and investment management

Discuss:
Your personal goals
Obtain details of your current position
Agree a plan - investment / pension etc.
Level of risk to be taken
Target return & asset mix


Invests:
Generally in funds, or a combination of funds and shares
Funds may be internal or external
Usually have a range of model portfolios - allocated to one
Reviews investments
Makes or suggests chnages - discretionary or advisory

Is about helping you to achieve your personal goals
Is a mismatch between client's perception of what advisers do, and what advisers know they can do

Advised portfolio:
Comment in IC 06/04/2023 P8 following Rathbones-Investec merger:
This potential tie-up could also have big knock-on effects for the investment trust sector, given that Investec Wealth and Rathbones are big backers of such funds. With the consolidated entity commanding even greater assets, it's likely it will inly be able to buy investment trusts of a certain size in order to avoid liquidity issues. Existing holdings that no longer make the grade could exp ... "The merger will create a £100bn platforms which will be by far and away the biggest owner of investment trusts in the UK, said analysts at investment bank Jeffereis. How many trusts will be big enough to remain on the platform? Where the combined entity's collective holding of a trust exceeds 20 per cent of the issued share capital, will they be forced sellers? experience share price pressure - or face the igger issue of shrinking to an unviable size.

Content from Killick letter 29/03/2021 - the Financial Services industry has evolved to such that to offer personalised recommendations we are now required to ensure those recommendations are suitable and to evidence that through a documented understanding of your broader financial crcumstances. Commonly known as "KYC" or Know Your Client, firms are now required to collect and maintain knowledge of their client's financial affairs  at an increasingly granular level. To reflect the regulatory landscape our services have also needed to evolve to make a clearer distinction between those who wish to recieve personalised recommendations and provide requisite disclosures, and those who are happy to respond to the firm's general research output and benefit from our custody and trade executions.
If require financial planning advice, or do not feel able to establish asset mix should have, indicates should obtain advice.
Often financial planning is paid for by fees charges for arranging investment transactions or managing investments.
Whether you should obtain advice or make your own decisions depends on whether advice will add value for you. Depends on you and your position. 
If you require advice and you do not have an adviser, asking fiends or family for a recommendation is often a good way to find one.
Are 3 main organisations in the UK and financial planners and investment managers are usually members of one or more of them - CISI and the Institute of Financial Planning Merged. There are Chartered Wealth Manager (possibly CISI) and Chartered Fellow of the CISI qualifications / designationss.
If complex - usually better to obtain advice.
If able to decide asset mix that you require, arriving at a suitable portfolio can be relatively straightforward - choose route that suits you, so advice may not add value.
Fees for advice.
Important to cost of advice does not outweigh the value provided.  Makes a big difference to drawdown. Total of fees for advice plus investment charges should be kept below 2% p.a. Generally a percentage of value.
Not really appropriate for financial planning, where fee may not reflect work involved.
Independent or retricted? IFAs tending to move to restricted due to regulatory burden and want fees from maanging funds (own platform) 

SJP:
Comments from Phil Craddock on 28/02/2023:
He advised client no to transfer DB pension. Client went to SJP who did it.
Client subseuqently had small amount to invest. SJP told client initial fee is 5% but they would reduce it to 3%.
They sent him a carriage clock on their anniversary.
PC says SJP have an initial charge + exit feewithin 5/6 years. They tell client they don't have to pay exit charge if they stay in.
FCA doesn't like exit charges.

Regulation:
See DD Hub website - adviser online info. Gave presentation at PFS Spring conference on 28/02/2023
FCA doc: TR16/1 - assessing suitability#FCA doc on Due Dilligence TR14/5
New Consumer Duty regulations - higher than Due Dilligence

Selling used to be problem solving - moved on to consulative selling - helping clients identify issues and find the solutions - disturb clients to identify issues and find solutions - PFS virtual conference 15/09/2021 Power Live financial planning session

How to find a financial adviser - FT / Simoney Kyriakou article on 03/02/2021

Find a financial adviser - add links:
Personal Finance Society - Find an Adviser
CISI - Chartered Institute for Securities & Investment - Find a Planner
SOLLA - Society of Later Life Advisers - Find an Adviser

What clients value most / reasons hire adviser:
Peace of mind
Investment returns
Don't know what doing
Don't want to spend time
Source: Power/Dimensional webinar 19/01/2022

Exit charges:
SJP exit charges - to remove for new clients from 2025. Remain for existing.
FCA had said wanted to stop exit charges - see FT/Moira O'Neill article 20/10/2023

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