# Explain the "professional advice" options for me for a money makeover?



## Hooverfish (10 Sep 2019)

Disclaimer: just by being in a position to be looking for advice, I do realise my partner and I are fortunate.

But I must be missing something basic. I don't get how you can receive impartial financial planning/investment help or advice in Ireland. What I've found so far:

1.  All the investment companies pay commission. So you end up paying extra for your investment whether or not you get independent advice because if your advisor isn't getting the commission then it is just paid internally to one of the company's reps who clearly isn't working on your behalf (Karl Deeter summary on a recent radio interview)?

2. Very few qualified financial planning advisors offer fee-based services. Where they do the cost seems to be around €1000 per person, but then you still have the issue of how to "execute" the chosen investments - see 1. I have been told by one commission-based advisor that the reason almost no advisors operate fee-based is because they tried it and people didn't actually pay their bills. Eh? Would you not ask for part of the money up front if that was the issue?

3. In searching for help I have been told "it's because the Irish market is too small, so we have to operate on commission unlike the UK. But the law changes mean you are protected because you get to see what commission is being paid to your advisor". But that doesn't mean, operating on commission only, that you can be sure your advisor has shown you the best options in the first place? Just that you know what commission they are getting so you get to choose between their selected options? What about recurring management fees?

4. There is one thing you can check, which is whether the advisor has any qualifications https://www.centralbank.ie/regulati...thorisation/minimum-competency/qualifications but I'm not really clear which qualifications are "just turn up" and which ones involve wide-ranging knowledge, numeracy and skill.

So, as far as I can work out, you just have to "hope" you have found someone honest with a qualification and trust them on a commission basis (nod, wink, referral?). Or pay a whack of a fee for advice that is hefty, unless you have a lot of money to invest? What level of investments would you need before coughing for independent advice would be worthwhile? And for fee-based advisors, why is it €2000 for a couple when the work involved, if the information is all to hand, is pretty similar to that for a single person?

I may just have been spectacularly unlucky in the people I've spoken to so far. And, of course, you can post here! But reading back through the forum it looks like requests to find advisors don't get many replies. 

And I'm not asking for free advice. We want someone we can trust to work for us, and for them to be paid for their skills. This does exist in some areas (eg paid advice on the health insurance market). But I'm going round in circles, especially as we look to be moving into an era where you will pay to have savings, not get any interest...

What steps would you take to find good professional advice?


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## cremeegg (10 Sep 2019)

Excellent post Hooverfish, the set up is fundamentally corrupt. You pay for fee based advice and still you pay recurring commission.

Individual advisors who try to offer a good service for a transparent fee certainly exist, including some excellent posters on here, but the circumstances are against them.

And of course the business attracts people who are happy to work in a world of little transparency.


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## NoRegretsCoyote (10 Sep 2019)

You will find someone who will give you tax advice on a fee basis.

For investment, general money makeover etc, I went casually looking a few years ago. I was willing to pay up to €1000, but I just felt I wouldn't find someone who would supply me with something specific enough to my circumstances.

The best advice you'll find is hanging about these forums.


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## Steven Barrett (10 Sep 2019)

Advisors are slowly moving across to fee based models. If you tell an advisor that you want to pay a fee only, there are a lot who should be able to accommodate you. My 10am meeting this morning is exactly that. 

Whether you are willing the pay the fee quoted is another thing. Had a call last week who told me that the work he wanted me to do was very straight forward. From experience, it was anything but and involves a huge amount of work. He didn't want to pay the fee I quoted. Not all the work we do is purely transactional form filling. There's a lot of work involved in getting to the bit where you sign the form and you want it done right. In a lot of cases, it can save you a lot of money over the years. 


Steven
www.bluewaterfp.ie


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## Marc (10 Sep 2019)

I agree with Stephen here. 

There are fixed costs associated with being an "adviser" regulation and Professional Indemnity Insurance etc.

There are fixed costs associated with advising a new client: For example, Anti Money Laundering (AML and CTF) requirements just ramped up the cost of simply talking to a new client and will go up again twice in the coming months.

Know your customer obligations (KYC) as set out in the Consumer Protection Code were amended last year and advisers are now required to provide more disclosure than before all increasing the cost of engaging with a client who just wants to arrange a "simple product"

I am just about to relaunch my own business as an outsourced fee-only consultancy to other Professional Advisers and have spent considerable time on reviewing the primary legislation at both an EU and Irish level in order to ensure that I can describe the service as "Independent"

The term ‘independent’ may only be used by an intermediary in its legal name, trading name or any other description of the firm where:

a) the principal *regulated activities *of the intermediary are provided on the basis of a *fair analysis of the market*; and

b) the factors to be taken into consideration by the regulated entity in conducting its fair analysis of the market includes the criteria set out in Article 53(1)(d) of Commission Delegated Regulation (EU) 2017/565. 

53(1)(d) states that  “ the criteria for selecting the various financial instruments shall include all relevant aspects such as risks, costs and complexity as well as the characteristics of the investment firm's clients, and shall ensure that the selection of the instruments that may be recommended is *not biased.”*


Where a *regulated entity *does not provide all of its *regulated activities *in an independent capacity, it must explain the different nature of its services in a *way that seeks to inform the* *consumer. It must ensure that there is no ambiguity about the range of services that it provides in an independent capacity*[2].



 

[2] 4.17 Consumer Protection Code 2012, 2015,2017



However, the simple fact is that the vast majority of consumers are not aware or are not concerned enough to demand more independence from their advisers. The Financial Services Industry has the upper hand here in defending the status quo.

Yes, I have encouraged a move to fee-based advice in Ireland over the last decade and as Stephen says, advisers are slowly moving to fee-based models but I know of at least one firm that was happy to drop the word "Independent" from its trading name last year.

Unless consumers demand higher professional standards and more independence nothing will change.

Our service consists of *independent*, whole of market advice to private clients. In respect of Global Wealth we provide advisory services based on a fair analysis of the market. We only provide intermediation services on the basis of an agreed remuneration directly with the client, We do not receive a third-party commission set by a product producer. 

Financial Planning and consultancy fees are calculated on the basis of the time spent on the plan and/or the assets under advice/management. The charging rate depends upon the complexity of the task and the seniority, qualifications, knowledge and experience of the individual working on the plan. Before commencing work all clients are notified of the level of fees in their particular case. These fees are subject to VAT where appropriate. 


Marc Westlake CFP*®*, TEP, APFS, EFP ,QFA
CHARTERED, CERTIFIED & EUROPEAN FINANCIAL PLANNER™ Professional
AND REGISTERED TRUST & ESTATE PRACTITIONER
Managing Director 

www.globalwealth.ie


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## Hooverfish (11 Sep 2019)

Thank you for your contributions. I would agree, so far the best advice I've seen is on this forum. I also understand the yearly costs of the insurance and qualifications required, as well as the diligence and information-gathering that is required for advisors to know they are remaining within the law. 

But my basic question still remains: how do you go about finding fee-based impartial advice? Are there membership lists to go through for advisors with particular qualifications? Are there threads I may have missed that give information on this? Our situation genuinely is not complicated, and I have all the information to hand. I am looking for a competent, numerate good communicator that can give straightforward advice.


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## mugsymugsy (11 Sep 2019)

What about speaking to the two people on here who appear to have their own business via a private professional basis as a starter and see how you get on.

I have no connection with anyone on here.


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## Steven Barrett (11 Sep 2019)

Hooverfish said:


> But my basic question still remains: how do you go about finding fee-based impartial advice? Are there membership lists to go through for advisors with particular qualifications? Are there threads I may have missed that give information on this? Our situation genuinely is not complicated, and I have all the information to hand. I am looking for a competent, numerate good communicator that can give straightforward advice.



There's no list that differentiates between advisors that charge fees and commission only. With regards to qualifications, an advisor is the CFP designation is more likely to do work on a fee basis but don't take it for a given that someone with the CFP designation will only charge a fee. Financial advice is not a profession and is still a long way off. For many, it is still a sales role. Distinguishing between those who are there to give advice and others who are selling can be difficult. It's not a good situation for the public. 


Steven
www.bluewaterfp.ie


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## Marc (11 Sep 2019)

i invested considerable time and effort to create both this organization  and this list. However, against my wishes the nature of payment (commission, fee only) etc has been removed from the site. It is one of the reasons why I stood down from the Board, as the organisation could not get behind the manifesto upon which it was created - namely to campaign for higher professional standards including a ban on commissions for investment products.





__





						More about Financial Planning
					






					www.sfpi.ie


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## cremeegg (11 Sep 2019)

SBarrett said:


> If you tell an advisor that you want to pay a fee only, there are a lot who should be able to accommodate you.



I had a meeting with an advisor on just that basis recently, and I agreed a fee well into four figures.

He then sold me a product which I subsequently discovered included a 0.25% trailing fee for himself.

I think this is fraud, and I think it is not uncommon.


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## Steven Barrett (11 Sep 2019)

cremeegg said:


> I had a meeting with an advisor on just that basis recently, and I agreed a fee well into four figures.
> 
> He then sold me a product which I subsequently discovered included a 0.25% trailing fee for himself.
> 
> I think this is fraud, and I think it is not uncommon.



Have you complained about it and got it changed? 

The disclosure requirements are very weak with lots of advisors burying charges in the documents. The Statement of Suitability should clearly states all allocation rates, management charges, policy fees, initial and ongoing commissions. brokers hiding fees should be reported...but as the disclosure rules are so weak, the format they are presenting may actually be within the laws.


Steven
www.bluewaterfp.ie


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## SPC100 (13 Sep 2019)

cremeegg said:


> I had a meeting with an advisor on just that basis recently, and I agreed a fee well into four figures.
> 
> He then sold me a product which I subsequently discovered included a 0.25% trailing fee for himself.
> 
> I think this is fraud, and I think it is not uncommon.


That's shocking.

Although I think many products in Ireland will pay commission. And I have had some advisors say that refunding the commissions would be alot of work..

Maybe we should create a simple no commission contract that folks can bring with them to fee advisors that would require them to refund any commissions or payments from products they advise on.


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## Steven Barrett (13 Sep 2019)

SPC100 said:


> That's shocking.
> 
> Although I think many products in Ireland will pay commission. And I have had some advisors say that refunding the commissions would be alot of work..
> 
> Maybe we should create a simple no commission contract that folks can bring with them to fee advisors that would require them to refund any commissions or payments from products they advise on.



...or maybe the advisor shouldn't have charged a commission without notifying and agreeing with the client beforehand. 


An insurance company gives advisors an array of different contract structures that they can offer to clients. Some are as flexible as pick your own rate, others have a few options. Nil commission is always available, especially when it comes to trailer commission. 


Steven
www.bluewaterfp.ie


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## North Star (13 Sep 2019)

Just to add that the Consumer Protection Code 4.58 states that for any on-going remuneration being charged, the broker must specify what service is being provided for that remuneration.  We interpret that as meaning you can just charge for no service. You may have grounds for a complaint.

"Where  remuneration  is  to  be  received  by  an  intermediary  from  a productproduceron   an   ongoing   basis   in   respect   of   a   product   or   service,   the intermediary must disclose to the consumeron paper or on another durable medium,  prior  to  the  provision  of  that  product  or  service,  the  nature  of  the service to be provided to the consumerin respect of this remuneration"

Re the original post, I think that you have to shop around with several firms to find one that has the right model/service /fee structure for you. Thats the best way in my view to get price transparency and clarity on the service provided. 
I believe most firms will give an initial consultation at their own expense. 
Vincent


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## SPC100 (13 Sep 2019)

SBarrett said:


> or maybe the advisor shouldn't have charged a commission without notifying and agreeing with the client beforehand.


I think that part goes without saying. Especially for fee advice


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## KOW (13 Sep 2019)

I was talking to a brother of mine a few months back who lives in Cork. He is aware that I am a big fan of this website. A lot of chat back and forward regarding all the above topics around financial advise fees etc.

Anyway to cut a long story short I offered him my opinion that some chap called SBarrett on AAM seemed to know a little and be upfront. He traveled up and met the man in question. Business was done and the brother really happy on all fronts.

I approached a little man from Cork in 2007 for financial advise. Too busy so passed me on to another outfit not far from the goat grill. Invested in a so called diversified portfolio. I finally broke even in 2018. Never ever again. 

So been cheeky and not wanting any financial advise( for a simple person like me). Can I ask a simple question?

Where or who do I go to if I want to invest a sum of approx. 100k each year for the next four years in MSCI work index. 
No advise needed. 
Just want to know that my money wont disappear no matter how index performs.

Cheers.


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## cremeegg (14 Sep 2019)

KOW said:


> Where or who do I go to if I want to invest a sum of approx. 100k each year for the next four years in MSCI work index.



50% here


50% here


			Investment Products
		

 The vanguard MSCI ETF

And that encapsulates the problem with the financial advice industry. No one could make a living giving straight answers to straight questions.


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## cremeegg (14 Sep 2019)

SBarrett said:


> Have you complained about it and got it changed?
> 
> Steven
> www.bluewaterfp.ie



Not yet, as to go back to the start with a different broker would be problematic.

But I hope to update when things develop.


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## KOW (15 Sep 2019)

cremeegg said:


> 50% here
> 
> 
> 50% here
> ...




Thanks cremeegg.
I lived in Ontario for 5years a while back and lots of advisers etc make a nice living doing what the above posters do, 

The first year living in Ontario I got a crowd called H&R block to do my tax return.
The second year I went to 2 night classes and learned how to do and submitted my simple Canadian tax return similar to filling out a Form 11 or 12 here.
The next 3 yrs I just gathered my few bits and threw them into H&R block because it cost an upfront minimal set fee.

Renewing my health insurance each year in Ireland I watch this site and maybe  put up a post asking questions.
Surely if the health Insurance companies were limited to having maybe half a dozen seperate plans it would be much better.


Getting back to investing/advise and the like. Everything could be so much more simpler. Good advise/service works every where else.
Unfortunately the system here is similar to trying to pick a simple health insurance plan.
The situation in Ireland is further complicated by the goal posts been consistently moved by Government.

Who wants to be an adviser. Not me.


Sad to say I dont pity any person trying to make a living in this area in Ireland. (eg.the tax rules around etf,s)


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