Stocks and shares ISA - IFA or DIY

[aussieal]

I am going to open a stocks and shares ISA before the end of this FY, all current savings in a savings account/cash ISA.

I went to see an IFA last week to talk things through, useful conversation and confirmed what I already knew about my approach to risk – mid 30s, with a family, looking at it as a long term investment – so 7/10 for my risk appetite.

Plan is to put in maybe £2k upfront, then add around £500 a month for the time being (wife currently on second mat leave in 3 years) and topping up/increasing the monthly when possible.

Crux of it is, I can’t decide if I am better off going with something like one of TPInvestor’s ready made portfolios that reflect my appetite for risk or paying the IFA’s commission to get them to build a portfolio, which on the above would equate to £1,560 in the first year not including ongoing charges?

Guess I’m just struggling to see benefit of the IFA over and above using TPInvestor (for example). Would an IFA for this level of investment use something similar to a ready made portfolio anyway?

For what it’s worth the IFA seemed very good, small independent in Mossley Hill, Liverpool.

Any thoughts?

[sidicks]

aussieal said:

I am going to open a stocks and shares ISA before the end of this FY, all current savings in a savings account/cash ISA.

I went to see an IFA last week to talk things through, useful conversation and confirmed what I already knew about my approach to risk – mid 30s, with a family, looking at it as a long term investment – so 7/10 for my risk appetite.

Plan is to put in maybe £2k upfront, then add around £500 a month for the time being (wife currently on second mat leave in 3 years) and topping up/increasing the monthly when possible.

Crux of it is, I can’t decide if I am better off going with something like one of TPInvestor’s ready made portfolios that reflect my appetite for risk or paying the IFA’s commission to get them to build a portfolio, which on the above would equate to £1,560 in the first year not including ongoing charges?

Guess I’m just struggling to see benefit of the IFA over and above using TPInvestor (for example). Would an IFA for this level of investment use something similar to a ready made portfolio anyway?

For what it’s worth the IFA seemed very good, small independent in Mossley Hill, Liverpool.

Any thoughts?

My view is that you use an IFA to decide what products are appropriate for you and to help you identify what your risk appetite is.

Personally I would not pay an IFA for investment advice I.e. which funds to invest in, as I don't believe that (most) are best placed to answer that question.

If I were you I'd go with something like Ginge R's 'fiver a day' website which will build a portfolio for you linked to your risk appetite and which appears to be fairly efficient from a cost perspective.

Failing that, go for the cheapest equity tracker you can find!

[Behemoth]

I'd second fiver a day. All the questions you need to ask yourself about risk etc are there & it's an elegant & easy site to use.

[Ari]

There's an argument that if you average out all the investment specialists and deduct their fees, generally you'll do as well (with arguably less risk) by simply investing in a FTSE100 tracker.

[bogie]

£1500 a year is a lot to give some advice on a few funds.

Spend £15 on a book, educate yourself, and make your own mind up, then Self manage online...its really simple.

https://www.amazon.co.uk/d/Books/Millionaire-Teach...

[Jockman]

sidicks said:

If I were you I'd go with something like Ginge R's 'fiver a day' website which will build a portfolio for you linked to your risk appetite and which appears to be fairly efficient from a cost perspective.

Failing that, go for the cheapest equity tracker you can find!

Absolutely.

[rsbmw]

Fiveraday or/and Vanguard Lifestrategy - job done.

[bogie]

rsbmw said:

Fiveraday or/and Vanguard Lifestrategy - job done.

pretty much what it says in the "millionaire teacher" book in the link above ...and many other common sense books for the layman investor....

[Ginge R]

Touched! Thank you.

[aussieal]

Good advice guys, appreciate it.

Was almost set to go with TPInvestor, but having had a look at your site Ginge R, I’m really impressed.

[GregK2]

Signed up to fiveraday last night from the recommendations on here. Thoroughly impressed with the site and sign up process.

[Liggle]

It can be as simple as you like:

Lowest cost ISA you can find

Low cost fund - Vanguard Lifestrategy 100% Equity for example

Set monthly savings to auto-invest in the Vanguard

Done.

Edited by Liggle on Thursday 9th March 14:56

[Behemoth]

Liggle said:

Hargreaves Lansdown ISA

Vanguard Lifestrategy 100% Equity

Set monthly savings to auto-invest in the Vanguard

Done.

Based on the security concerns described here, personally I wouldn't until they've cleared up: http://www.pistonheads.com/gassing/topic.asp?t=165...

[TartanPaint]

bogie said:

£1500 a year is a lot to give some advice on a few funds.

Spend £15 on a book, educate yourself, and make your own mind up, then Self manage online...its really simple.

https://www.amazon.co.uk/d/Books/Millionaire-Teach...

Is that book a serious recommendation? I wouldn't mind reading something along those lines, but the presentation of that one stinks of "get rich quick" seminars, not "teach yourself investment and savings".

Thanks.

[WindyCommon]

someonewithalittleknowledge said:

Hargreaves Lansdown ISA

Vanguard Lifestrategy 100% Equity

Set monthly savings to auto-invest in the Vanguard

Done.

That'll be 22bps to Vanguard for fund management and 45bps to HL for administration. A low cost fund and an expensive platform.

Why choose HL over another ISA provider with lower charges? Even Charles Stanley Direct is at 25bps for ISAs.

The "advice" offered freely here - and with such certainty - really is extraordinary at times.

[rsbmw]

TartanPaint said:

Is that book a serious recommendation? I wouldn't mind reading something along those lines, but the presentation of that one stinks of "get rich quick" seminars, not "teach yourself investment and savings".

Thanks.

I don't think it's either, it seems to be a "where to put your money to sensibly save for the future in a minimal effort fashion"

[TartanPaint]

WindyCommon said:

someonewithalittleknowledge said:

Hargreaves Lansdown ISA

Vanguard Lifestrategy 100% Equity

Set monthly savings to auto-invest in the Vanguard

Done.

That'll be 22bps to Vanguard for fund management and 45bps to HL for administration. A low cost fund and an expensive platform.

Why choose HL over another ISA provider with lower charges? Even Charles Stanley Direct is at 25bps for ISAs.

The "advice" offered freely here - and with such certainty - really is extraordinary at times.

The link you kindly gave me yesterday, Windy, also has ISA charges on it.

http://moneyweek.com/personal-finance/isas/stocks-...

[Liggle]

WindyCommon said:

someonewithalittleknowledge said:

Hargreaves Lansdown ISA

Vanguard Lifestrategy 100% Equity

Set monthly savings to auto-invest in the Vanguard

Done.

That'll be 22bps to Vanguard for fund management and 45bps to HL for administration. A low cost fund and an expensive platform.

Why choose HL over another ISA provider with lower charges? Even Charles Stanley Direct is at 25bps for ISAs.

The "advice" offered freely here - and with such certainty - really is extraordinary at times.

Doesn't have to be HL, Charles Stanley Direct would be a better option yes. I have amended my post

Edited by Liggle on Thursday 9th March 14:59

[rsbmw]

I use CSD, really nice platform to use and reasonable charges I think.

[TartanPaint]

rsbmw said:

TartanPaint said:

bogie said:

£1500 a year is a lot to give some advice on a few funds.

Spend £15 on a book, educate yourself, and make your own mind up, then Self manage online...its really simple.

https://www.amazon.co.uk/d/Books/Millionaire-Teach...

Is that book a serious recommendation? I wouldn't mind reading something along those lines, but the presentation of that one stinks of "get rich quick" seminars, not "teach yourself investment and savings".

Thanks.

I don't think it's either, it seems to be a "where to put your money to sensibly save for the future in a minimal effort fashion"

I "pulled the trigger" (I'm so PH, me!) on the kindle version, had a skim through the topics, and I've learned something already!
If anyone else, like me, needs a dummies guide to money, this does indeed seem to be a good starting point.

Although Chapter 1: Don't waste money on cars, is a bit anti-PH... I think I'll skip that and read Chapter 2.

Thanks.