£120K pension into a share of a Cape Verde hotel room?

[butchstewie]

This is absolutely batst.

‘I sank my £120,000 pension into a Cape Verde hotel room. Now I’ll work into my 70s’

The headline is bad enough but then it goes on to say the bloke was a Financial Advisor.

Oh and the reason he did all this? The lure of 7% returns.

[Blue_star]

His wife was dying and he decided to make life changing investment in the meantime. But now he has new partner so clearly not suffering still.

Also claims that 120k was all his pension pot.

I think whatever is left out of the story tells more than the article.

[Cats_pyjamas]

Madness. I maintain that if FA's were genuine great at what they did, they wouldn't be FA. No offence to any Financial Advisors reading.

[Caddyshack]

Cats_pyjamas said:

Madness. I maintain that if FA's were genuine great at what they did, they wouldn't be FA. No offence to any Financial Advisors reading.

I know what you mean but that doesn’t look at what the FA does. Many work with lump sum investments, but they know where the smart money invests but that doesn’t mean they have lump sums themselves.

I have been in financial services for 30 yrs. mainly in the mortgage market but also started in investments.

Many IFA’s do appear to be “cobblers shoes” or like a sparkys own houses but i have also worked with many who did max out their own pensions, isas and bought lots of buy to lets. One I know runs a very impressive supercar collection too that has made a load trading up.

Some I have met have over £1m per yr recurring income from invested client funds, why would they give that up?

[Huzzah]

It does sound foolhardy, but people can make rash decisions when stressed. I know I have but not life changing.

[Derek Chevalier]

Cats_pyjamas said:

Madness. I maintain that if FA's were genuine great at what they did, they wouldn't be FA.

Great at what?

[Derek Chevalier]

Caddyshack said:

[but they know where the smart money invests but that doesn t mean they have lump sums themselves.

Smart money typically doesn't offer access to retail investors, including financial advisers.

[Caddyshack]

Derek Chevalier said:

Caddyshack said:

[but they know where the smart money invests but that doesn t mean they have lump sums themselves.

Smart money typically doesn't offer access to retail investors, including financial advisers.

Such as?

[Derek Chevalier]

Caddyshack said:

Derek Chevalier said:

Caddyshack said:

[but they know where the smart money invests but that doesn t mean they have lump sums themselves.

Smart money typically doesn't offer access to retail investors, including financial advisers.

Such as?

I'd define smart money as those with a genuine edge.

[Steve H]

It’s a sad tale but a FA with barely six figures in pension in his late 50s should know not to be taking advice from himself on how to invest it.

[DonkeyApple]

Steve H said:

It s a sad tale but a FA with barely six figures in pension in his late 50s should know not to be taking advice from himself on how to invest it.

There is almost certainly and as per usual, key information being omitted and what has been presented has been done in a style to fit the journalist's intent.

[Steve H]

DonkeyApple said:

There is almost certainly and as per usual, key information being omitted and what has been presented has been done in a style to fit the journalist's intent.

No doubt, but the basic bones of the story are presumably something like true in which case my position is unchanged.

[alscar]

2 FA’s , one with clearly a very stressful situation going on but supposedly friends.
It’s not like a pretty modest 7% return is a no brainer don’t think about it just do it type investment.

[Caddyshack]

Steve H said:

It s a sad tale but a FA with barely six figures in pension in his late 50s should know not to be taking advice from himself on how to invest it.

Might be poor reporting for clicks and was really 10% of his pot for all we really know.

[98elise]

Caddyshack said:

Steve H said:

It s a sad tale but a FA with barely six figures in pension in his late 50s should know not to be taking advice from himself on how to invest it.

Might be poor reporting for clicks and was really 10% of his pot for all we really know.

It says a couple of times it was most if not all of his pot.

Edited by 98elise on Thursday 5th November 17:56

[98elise]

butchstewie said:

This is absolutely batst.

I sank my £120,000 pension into a Cape Verde hotel room. Now I ll work into my 70s

The headline is bad enough but then it goes on to say the bloke was a Financial Advisor.

Oh and the reason he did all this? The lure of 7% returns.

Its 7% minus fees etc!

A simple UK residential BTL would get you 6-7%. I regularly see commercial properties sell with 10% yields in auctions. I've seen some flats go through auctions with 12-14% yields with a tenant in situ, so making money from day one. The S&P500 returns 10% on average, and decent funds much more (and of course can be held in an ISA)

Hoping to get 7% from a half built resort in Africa is mental.


Edited to add....

As an example I was just looking through the results of an auction today and saw this. £131k with an £18.3k annual return. Thats a 14% yield.

Edited by 98elise on Thursday 5th November 17:57

[Steve H]

98elise said:

Caddyshack said:

Steve H said:

It s a sad tale but a FA with barely six figures in pension in his late 50s should know not to be taking advice from himself on how to invest it.

Might be poor reporting for clicks and was really 10% of his pot for all we really know.

It says a couple of times it was his most if not all of his pot.

And why volunteer for a sad-face interview if you haven’t blown your stack on it? You would surely just quietly lick your 10% wound in private.

[DonkeyApple]

Steve H said:

98elise said:

Caddyshack said:

Steve H said:

It s a sad tale but a FA with barely six figures in pension in his late 50s should know not to be taking advice from himself on how to invest it.

Might be poor reporting for clicks and was really 10% of his pot for all we really know.

It says a couple of times it was his most if not all of his pot.

And why volunteer for a sad-face interview if you haven t blown your stack on it? You would surely just quietly lick your 10% wound in private.

I'm forever cynical when it comes to people's motives re their financial behaviour.

For example, if he were regulated in his activity as an advisor then the register has only two people who look to fit.

[Enut]

Cats_pyjamas said:

Madness. I maintain that if FA's were genuine great at what they did, they wouldn't be FA. No offence to any Financial Advisors reading.

None taken, I've just retired as an IFA after 38 years. I started as an associate with Abbey Life when I had left university and was living in rented flat with £12,000 in debts, I became an independent financial adviser three years later. I do not come from a wealthy family and have never inherited or been given money. I am proud of the work I have done and the advice I have given. I will be comfortably off in retirement and, at 60, hope to have a few good years left. Everything I have built up is a result of hard work, saving and investing and I am invested in the same funds that I have recommended my clients invest in.

No PI claims against me and a clean compliance record. I have never advised on the sort of investment covered in this post. The only reason the 'financial adviser' in this article has lost a large percentage of his pension is that he wasn't good at his job and was sold an unsuitable investment by another salesman almost certainly because of the commission it paid. No sympathy at all and the fact that he no longer works as a FA is a good thing, God only knows what advice he gave when he was one.

[butchstewie]

And this one.

I should know better than to take any of the Telegraph Money articles like this at face value but still.

‘I can’t get a job at 62. How can I make my savings last?’