# We will all be ruined says Hanrahan.



## endowed (13 Mar 2003)

I feel like a right MUTT. I have taken expert advice in my investment life and right now I am seriously underwater.

1. Took out an equity based investment plan (monthly contributions) in 1987 to help with college fees starting in 2006. Right now I am 30% under my contribution levels to date.

2. Joined the rest of the sheep in the EIRCOM saga .

3. Took out equity SSIA (EBS) in Feb 2002 also under water.

4. Have half starved myself in trying to max my pension AVCs since 1989. Currently contributing 20% of salary.

Now thats all after expert ADVICE. 

Im only sorry I didnt put on the horses.



_Moved from "Savings & Investments" forum_


----------



## Hubert (13 Mar 2003)

*after expert ADVICE*

It sounds terrible but you should count your lucky stars you haven't been able to claim on your life policy!

Hubert


----------



## rainyday (13 Mar 2003)

*Re: after expert ADVICE*

Hi Hanrahan - Sorry for your trouble, as they say.

Have you checked out what fees you are paying on the investment fund for your educational fees? If these fees are no longer competitive, you might throwing good money after bad.

And what experts advised you on the Eircom purchase and the EBS SSIA purchase?


----------



## beansntoast (16 Mar 2003)

*now on i'm sticking with credit union*

i know how you feel i'm in same boat and guess alot other people..i wish i went to the pub more often and drank my money!


----------



## mrpotatoehead (28 Mar 2003)

*Got stung too*

Feeling mutual here worked hard putting the money away then took some advice which basically told me I was missing out on the easy money.

Deliberately did not even go with any risky shares but just wanted to keep it a little over inflation.
Now I'm stuck with all these crappy shares like a lot of other people.

Ahh well just going to blow the rest on whatever coz this worrying ain't for me


----------



## Mr Broke (29 Mar 2003)

*Getting Stung !!!???????????*

Hanrahan/Beansontoast/Mrpotatoehead,


Do any of you feel, in some way, responsible for your own actions?

I assume that you all agreed with the advice that was offered at the time of each transaction?


----------



## fee (29 Mar 2003)

*pay for advice*

Mr Broke

If people pay for advice and get bad advice you suggest that they are somehow responsible?????????


----------



## fee (29 Mar 2003)

*and*

if they weren't willing to take the advice what did they go to advisors for?????????


----------



## Mr Broke (31 Mar 2003)

*and*

Of course people should be responsible for their own actions. They were there when the advice was given. They paid for it, AGREED with it and now, because of selective memory in relation to the time frames and risks involved it's time to blame the advisor.

It's a bit like blaming your GP because the condom burst after you received family planning advice.


----------



## fee (31 Mar 2003)

*and*

The lesson is Dont' bother going to advisors because they have an out if things go wrong. They blame the poor sucker for taking their advice. If I may continue with your analogy............ Most people have an alternative when the condom bursts - they can take the morning after pill. No such cure all pill in the advice sector exits it appears. Take the advice but don't blame us if the bubble bursts!


----------



## Mr Broke (1 Apr 2003)

*Having an OUT*

If the bubble bursts pour your grief out to the fund manager. See how far you get.

If the adviser did not have an out before they have umpteen of them now.

These new regulations will have the client so tied up in paper that they will not know what they are signing. As far as I can see, things like terms of business, fact finds and reasons why letters are for the protection of the adviser.

There is no come back now for the client if things take a turn for the worst. The clients signature is now all over the place stating that she understood exactly what was going on when she signed up.

Who put this crap in The Great Financial Debates ?


----------



## Caius Martius (1 Apr 2003)

*Re: Having an OUT*

I do not think that either of you are going to come any closer on your opinions here. While I sympathise with anyone who looses money through no fault of their own ie through deception, I would find it difficult to agree with fee that reductions in the values of investments can be blamed on the adviser.

My understanding of the sales process is that, after a comprehensive interview between both parties there is an agreed action that is to take place. This action will be dependent on all the factors (time,attitude to risk,other investments etc) that were discussed during the interview. 

If the investor or saver wishes to question the logic or reasoning behind the advice then they can do so at any time up to signing the contracts and I think they can opt out up to two weeks after signing.

In the current investment climate you are not going to find too many investors scrambling to congratulate their stockbroker or investment adviser. In fact, there are very few instances, I would say, where any adviser gets a 'Thank You' card :lol


----------



## fee (1 Apr 2003)

*re: thank you card*

:lol 
Fortunately, I still have a sense of humour despite all!


----------



## Dogbert (2 Apr 2003)

*Advice*

If this thread is serious ... then we need to draw a distinction between bad advice (about a client should justifiably feel aggrieved) and bad outcomes from good advice (about which they should not).

Advice to purchase an SSIA, for example, was good advice, provided you can afford it. It gives you access to a valuable tax incentive not otherwise available. Advice to select an equity SSIA may have been good advice, even though so far it has had a bad outcome, if the adviser explained the risks/rewards of equities relative to deposits properly to you, and allowed you to choose the vehicle you felt was most appropriate. If the adviser didn't explain these, then it may have been bad advice.

Virtually every form of advice, financial or otherwise, involves tradeoffs and choices, and those are made by the customer, not the adviser. So Mr Broke is right - having sought advice does not abrogate the customer from the responsibility of actually making the decision themselves, and owning the consequences of it, provided they have not been badly advised.


----------



## Tommy (2 Apr 2003)

*Re: Advice*

Did anyone else ever notice that, in sport, people only complain about the referee when they lose, and never when they win?


----------



## beans n toast (4 Apr 2003)

*lidl beans*

i'm not blaming advisors..i'm blaming companies that hyped up the prices of their stocks with false accounting,the selling of eircom to the general public that owned it anyway at an inflated price,the selling to vodaphone at bargain basement price  when things got too hot...jumping out frying pan into the fire.
Rip off fees(legal robbery) for pension funds and avc's....although the pension scene getting better with prsas and competitive internet brokers.
Joe soap ends up getting ripped off while joe big guy can write off his losses against tax.
Also stocker brokers saying shares a buy and they knowing the company is fast going down the  drain.
I'm just joe soap...how can i win by trying to keep my head above inflation..when the playing surface is uneven?


----------



## daltonr (23 Apr 2003)

> Took out an equity based investment plan (monthly 
> contributions) in 1987 to help with college fees 
> starting in 2006. Right now I am 30% under my 
> contribution levels to date.


You've been investing in equities since 1987, how can you be doing badly?  Was your adviser independant
or was it the "Financial Adviser" at your local bank?

The FTSE 100 has doubled since 1988 at one point 
it had almost quadrupled but that doesnt matter, there's
no reason you should be down on your contributions if
investing since 1987.

Name and Shame the Fund/Institution that's 
looking after your money.

On the Eircom issue,  I still can't understand why people
are upset.  I have yet to meet a single person who
looked into the company in any meaningful way before
handing over their money.  I've yet to meet anyone who
could tell me what they realistically expected to earn
from the investment.

Did an actual independant financial adviser tell you that
eircom was a good bet.  If so, I'd be concerned.
I didn't think they suggested individual shares.
He might have said shares are a good bet over the long haul, and that would have been true.

Your SSIA is only a year old.  An investment in equities
should only be judged over at least 5 years, which
you're presumably committed to anyway.  If you
were that concerned about risk why didn't you 
pick the deposit option?

It sounds like you want the returns but none of the risk.

That aint gonna happen, as any decent "Independant"
adviser will tell you.

Find out what's going on with the 1987 investment,
that ain't right.

-Rd


----------



## Slim (24 Apr 2003)

*We will all be ruined says Hanrahan*

I think everyone was caught with trousers down by the collapse in equity markets. Most people who claim to have sold out at tyhe top of the market deliberately are either bluffing or Warren Buffet(ing), geddit?

I have studied the available websites on investing, particularly Motley Fool etc, and have fallen for all the hype about equities being the strongest performer over time. That may be true but things have changed. Can any of us afford to wait to reap the benefits of the upswing?

I have been lucky overall, viz;
-My endowment policy was with profits and I sold it at a handsome profit a couple of years ago
-I benefitted from free shares in demutualisation of Norwich Union, First active and borrowed heavily for Eircom and NU. Profitted from each, not through my brilliance but by lucky selling
-I dithered over SSIA options until I had no choice but to take fixed 4% option at my bank, ho hum!
-My mortgage LTV is about 35% thanks to rising house values(Bummer, I fixed, at wife's urging and against my instinct into a 5.99% deal which thankfully will expire next month)
-I borrow from Credit Union for our family cars
-I will get more free money from First active soon

My greatest good fortune is that I have never had enough money to invest in the ways I thought would be most profitable, e.g. I would have put a lot into Elan, Eircom etc. I realise that my good fortune has been the result of lack of knowledge, conviction and resources. From now on I intend to pay off expensive personal debt, accelerate mortgage payments, max out the SSIAs and enjoy a good sleep at night.

Investment advisers are commission driven and have to put a spin on the markets to persuade people to invest in new products. Most of these products are heavily slewed in favour of the institutions. You might more productively put a 10€ yankee on on Saturdays. One day your bet may come up. Most trackers will not.

I sympathise with previous posters but share daltonr's disbelief at Hanrahan's return since 1987. There but for the grace of God go I!

Slim - (lucky not smug!)


----------



## ClubMan (24 Apr 2003)

*Re: We will all be ruined says Hanrahan*

Interesting post. Maybe I'll post details of my own personal investment experiences but only after the AAM viewing watershed. :eek    

*Investment advisers are commission driven and have to put a spin on the markets to persuade people to invest in new products. Most of these products are heavily slewed in favour of the institutions. You might more productively put a 10€ yankee on on Saturdays. One day your bet may come up. Most trackers will not*

That's not totally true or fair - some advisors are fee based rather than being remunerated through commissions or other "kick-backs" and have no conflict of interest in selecting products appropriate for the customer's requirements. Some products are convoluted (e.g. the latest slew of tracker only or combined split deposit/tracker bonds) and arcanely technical but others do exactly what they say in the tin even if the onus still falls on the consumer to read the associated terms & conditions/documentation and understand what they're getting into.

Disclaimer - I am not involved in the financial industry in any capacity.


----------



## Tommy (24 Apr 2003)

*Re: We will all be ruined says Hanrahan*

All Authorised investment advisors (AA's) are regulated and supervised by the [broken link removed] Under law, they must subscribe to codes of practice which are designed to protect the consumer's interests. [broken link removed] provides what seems to be a definitive list of the compliance obligations of AA's in relation to investment business.


----------



## Slim (24 Apr 2003)

*We will all be ruined says Hanrahan*

Don't mean to blacken all advisors. In fact, my knowledge of them is very limited and I may be confusing them with salespersons for financial institutions. I nevertheless maintain a healthy scepticism about their products.

By the way, excellent web site Tommy - worth visiting and very informative.

Slim


----------



## ClubMan (25 Apr 2003)

*Re: We will all be ruined says Hanrahan*

Fair enough - in my opinion there is a world of difference between a company sales person/representative and an "official" advisor (whether they be an AA or an RIAPI or whatever). The former will _definitely_ not provide independent objective advice but will merely try to sell products provided by the relevant institution. In contrast, at least with an AA/RIAPI or whatver you have some chance of good advice!


----------



## daltonr (25 Apr 2003)

*Get In, Invest Regularly, Be Patient, Watch those Fees.*

>have fallen for all the hype about equities being the
>strongest performer over time. That may be true but >things have changed. Can any of us afford to wait to >reap the benefits of the upswing?

Not sure things have changed.  The very fact that
we are in a slump shows that we are in a cycle. 
Remember there were those who claimed that things
HAD changed and equity growth would go on forever.  New Economy and all that nonsense.  

There are trends in equities that go back 80 years that
show that over time, steadily and patiently investing
you will do well.

I do agree that the fees that institutions put between
you and your portfolio are shameful, particularly in
this country.

I talked in another post about how even the exchange
rate spread that brokers apply could easily cause you
to lose as much as 9 or 10 thousand over your
investing career.  That's before you look at fees and
commissions.

Find a cheep way to get in the market, invest
regularly, be patient.  It'll work out.

For the record I am not in the Financial Industry.

-Rd


----------



## Williams (25 Apr 2003)

*Wild Comments*

Slim said 'Don't mean to blacken all advisors. In fact, my knowledge of them is very limited ......... I nevertheless maintain a healthy scepticism about their products.'

I thought it was the moderators job to delete comments like this. A misleading statement based on nothing.


----------



## ClubMan (25 Apr 2003)

*Re: Wild Comments*

_Slim_ is merely expressing a personal opinion which has since been challenged. I don't think that deletion is necessary in this case.


----------



## Tommy (25 Apr 2003)

*Re: Wild Comments*

Williams, if you have a problem with Slim's cotribution, why not rebut any point you have a problem with?


----------



## Slim (25 Apr 2003)

*Wild Comments*

Williams

I was just honestly reconsidering my earlier statement in the light of subsequent points made by others. Independent FAs are a relatively new species and my experience is mainly of so called advisors who are actually reps/brokers. If that was my sole point in my posts you would be correct that it was worthless, but I think it was a small part of the overall.

Slim


----------



## joeysoap (26 Apr 2003)

*and*

it appears to be a big boat we all set sail on.
I too caught a cold, but also scored a goal or two.
free first active cash but (unfortunately?) had cleared loan prematurely otherewise would have received double.
took out a small irish life tracker in 1995 based on a number of indices and cashed in in 1998 at 66% up.
was advised by irish life to hold on until the full 5.5 years were up but could not see the point as 1/5 if policy was in japan and another 20% of 1/5 was in smurfitt. 

taking a bath on eircom but can wait and vodaphone just might come back. but downside is sterling has fallen. talk about winning and losing.


Invested £4000 (punts) in a 10  year scottish provident with profits policy in 1992. matured in 2002 at €12000+ and unbelievably received £4000 sterling from scottish provident upon demutualising  and put it into a loan note in london to avoid tax ( legal). There's that sterling again!
invested £5000  punts in scottish provident   in 1997 and was informed this year that they were cancelling the  policy as it was a dud(my words)and received €5,500 back. talk about ups and downs.


losing too much in irish life scope at present but maybe some day.

finally .At  least resisted all temptation and went for     an post at 4%   fixed ssia.

back to advice. i regret not playing my own hunches over the years. for instance at present Jurys hotel only about 1/2 previous high, maybe in couple of years will recover. who knows? but I bet my hunches would be as good as any overpriced and pompous adviser.

anyway whats the point of worrying, teenagers have it right. enjoy life and just go with the flow.


----------



## rockflake (2 May 2003)

*re Hanrahan*

Hi Hanrahan,

It annoys me when people blame advisors for decisions which they made which subsequently lose them money. 

SSIAs were a great investment and anybody who told you to bundle in as much as you could was giving you great advice. The fact that the markets went south subseqently is unfortunate but not their fault.

Eircom was a great investment and anybody who advised people to get into the stock was giving great advice. I am not suggesting we rehash what is a very old debate which has already been sufficiently aired on AAM, but many people seeem to forget that Eircom shares shot up in value after the flotation. There is only one measure to the value of a company and the price of a share - supply and demand. If a share price plummets immediately after a flotation then it is reasonable to deduce that the offer price was  too high. If its soars then it is reasonable to deduce that the offer price was at a discount to the value. Eircom's soared and I was one of those people who made a 25% return on the maximum investment in a matter of days. 

If an advisors could call the market they wouldn't be spending their time advising you on where to put that 10k lump sum. Getting advice does not abrogate your responsibility for your decisions.

That said I'm sorry you investment experience was not more fortunate.

regards,

Rockfalke


----------



## ClubMan (2 May 2003)

*Re: re Hanrahan*

Notwithstanding the fact that there _have_ been obvious cases of misselling, arguably misleading advertising (e.g. those convoluted tracker bond and deposit/tracker bond products) and that people have to be on their guard about being pressurised/rushed into inappropriate investment decisions, I have to agree with you on the point about people ultimately needing to take responsibility for their own decisions - something that I mentioned  and . Unfortunately, it seems that we still have a long way to go before people are interested, motivated and informed enough to systematically review their financial situation, investment goals/timeframe, attitude to risk/volatility, overall "portfolio" etc. for themselves and to understand the financial products available to them, and in particular the risk/potential rewards tradeoffs involved, _before_ buying into them. In fact many (most?) people will never fall into this category regardless of how much information is made available to them as evidenced, for example, by the reaction of some people that charges disclosure information is a burden rather than a help to them, the repetition of queries along the lines of _"I have €x - what is the best product"_ here on AAM, and so on. As such, many people will continue to rely on third parties for savings/investment advice (hopefully objective and independent and not their friendly local bank teller or other tied agent or whatever) but they need to understand that once they sign on the dotted line it is _they_ who have made the decision and that there is no point in blaming somebody else if/when things don't turn out as expected (something I know only too well myself! :\  ).


----------



## joeysoap (18 Jun 2003)

pity I didnt take my own advice. Jurys is up just over 20% since I posted. Maybe thats why I am not an advisor. They couldn't pick their nose.


----------

