any financial advisors/people around, need help on what is the best way forward.

[thesouthsbelle]

Firstly have any of you had dealings with Edward Jones of London? I am dealing with a perfectly nice chap who knocked on the door - seems to be new to the area/job. anyhow,

I've asked him to sort out life insurance, he's come back with what I think is a good policy, it's £37 per month thru legal and general. It will provide £180K upon death/critical illness, as a lump sum plus a monthly income of £1300 payable to whomever DS is with (ie his guardian) so they don't actually have to provide for him - the idea is it would cover towards rent, clothing food etc etc. This is all set in stone until he's 21, those payments would continue. (of the lump sum £150K is a mortgage - which i'm hoping to get within the next 5 years) and £30K would be for his university fees.

Anyhow does that sound good to you/anyone?, whilst i'm in accounts myself, when you start talking investments/the best life insurances/cover etc it goes a bit beyond me, (hence going with a professional)

Also, i've taken on more hours in work, which will provide me with approx £400 p/m extra, I was intending to put that with some other money, & invest approx £500 per month, plus put a little bit extra each month into an ISA for me, bank savings & also DS's child trust fund. but for the main psrt it would be £500 for me to invest (ideally)

My long term goals are to get a pension, I want to be able to provide the money for DS to go to uni, to save a good deposit for a house, but to achieve long term financial security for DS. (also also be able to live comfortably during my retirement)

I'm 27, so time is on my side, i'm a medium risk person really, I would invest and wouldn't mind too much if the markets dropped and I lost some money, however long term I would like to see a fairly good/modest growth/return.

Anyhow, I hope this is making sence to someone! lol.

also with ISA's, if I get one through my bank, (as my parents suggest) it will be free I assume, however will it be as good a return as an advisor could get for me/I know I would pay an advisor but how much of a 'cut' out of your monthly investment do they take?

also if I chose to go it alone, how easy/hard is it to buy stocks/pensions etc on your own - i'm literally clueless about this side of finance. (a cousin does it in the city for HSBC, some division or other and is quite high up with the stock markets, but tbh I don't want him knowing the ins and outs of my finances)
HELP!

[thesouthsbelle]

bump.

[Swedes]

I think you would be better off saving up for university by using your ISA allowance.
I would recommend you set up an account with an online stocks and shares ISA provider (I use Hargreaves Lansdown and can't recommend them highly enough). You can invest up to a maximum of £7,200 and it's tax free and the risk is really very low as you can only invest in FTSE 250 companies, you can't invest in shares in the more risky Alternative Investment Market (AIM shares). So in one year you might buy for example:
£1,000 (incl charges)worth of BP shares
£1,000 (incl charges) worth of Rentokil shares
£1,000 (incl charges) worth of M&S shares
£1,000 (incl charges) worth of Man Group shares
£1,000 (incl charges) worth of Prudential shares
£1,000 (incl charges) worth of Glaxo Smith Klein
£1,200 (incl charges) worth of Wm Morrison

Hargreaves Lansdown charge £29.95 per trade (buy or sell) plus of course HMRC take 0.5% stamp duty from a share purchase (you don't pay stamp duty on selling though). There is nothing to stop you feeding the money into your ISA every two months, so pay in £1,000 and then buy a £1,000 worth of shares including charges.

Other than the 29.95 per trade, Hargreaves Lansdown do not take a cut and their researchy and information is superb. Also their user interface is gorgeous. I had an alternative ISA provider who only charged £9.95 per trade but they also charged a quarterly fee and their share research and guidance wasn't up to much. I find Hargreaves much better value and well just brilliant. I am sorry to wax lyrical but they are excellent and they are nothing to do with me apart from me being one of their many satisfied clients.

I'm not sure about the life insurance. It sounds v pricey to me, given your age.

[Swedes]

By the way, I'm not a financial advisor.

[LadyMuck]

Looking at the outcome in the event of your death, your ds will have your house outright, plus £1,300 per month? That seems a bit high for day to day expenses to my mind, unless you have a significant standard of living in which case the lump sum looks small. Personally I would look at a higher lump sum and leave out the complication of a monthly payment for him. If the lump sum is left in trust then his guardian should be able to draw on it as necessary but it shouldn't affect tax credits etc. A monthly income at that level leaves him subject to income tax. For a similar premium you would be able to get LI/CI for £300k. If a claim was made then the lump sum (net of mortgage) would be invested and in itself produce some income. As I assume your ds would be selling the house as he would be living with his guardian I think that a lump sum of £300k is a fairly generous one for a single child.

Who are your ds's guardians? What is the likely extent of their additional costs in looking after your ds?

ISA is not a bad way to go for university fees. Personally we've gone for some index trackers rather than trying to beat the market. We are therefore invested in a range of shares cross the board rather than cherry-picking. I think that the probably fits a definition of medium risk closer than picking specific stocks yourself. But I am not a financial adviser.

Definitely start a pension as soon as you can. The earlier you start it the less you have to pay later. At 40 our pension is our single largest expense (excluding income tax which isn't exactly optional). Does your employer offer anything?

What credentials did Mr Jones come with out of interest? Has he explained whether he is a tied agent in any way?

[thesouthsbelle]

LM - as it was explained to me the whole lot would be tax free, incl the monthly income and would by pass my estate/probate.

it is an awful lot for a little boy granted. the idea was that anything he needed/wanted would be provided for him wihtou causing hardship to the guardians, they would be either DB & SIL, mum & dad, or in the event of XH, it would be him, mum & dad. (don't want XH to spend it/piss it up the wall basically.0

thanks for your input thou will sit down when ds is asleep and look properly.

re the mans credentials, he showed me his card, and said the company is fsa not him personally.

[thesouthsbelle]

also that figure is the only figures I would have/pay between now and 18 years time - so if I died in say 10 years DS would still have the same money - it wouldn't increase at all, but obv the cost of living would etc.

[thesouthsbelle]

also that figure is the only figures I would have/pay between now and 18 years time - so if I died in say 10 years DS would still have the same money - it wouldn't increase at all, but obv the cost of living would etc.

[LadyMuck]

But if you die in 10 years time then presumably your ds would only start getting the £1,300 from that point, whereas if you opt for a lump sum then he would get the entire lump sum whether you died now or when he was 20.

I'm not sure if you are aware, but cold-calling is forbidden by the FSA, so that would make me slightly wary. Again if he has just given you his business card, then again that is not in line with FSA requirements. Personally I would be very wary. This sounds like a sell and run to me (ie he will sell you some package which pays him a healthy commission, but you will not have any ongoing contact, or review of the position etc).

How did you reach the £1,300 per month figure btw - it seems rather specific?

[LadyMuck]

You've named a lot of guardians there - does your will name all of those?

I would think about the situation that each set of guardians would face, and consider whether access to a large lump sum would be more appropriate than drip feeding an income. In our case, the family who would be guardians to our 2 children would need to move house in order to accommodate them. A lump sum in trust can be used to buy a share in the property (which continues to be held in trust for our children until they turn 21). Whilst the £1,300 can be used towards rent, I think that using it towards a mortgage will be trickier, at least in terms of calculating what if any beneficial interest your son would have in the property when he turned 21.

[thesouthsbelle]

re the guardian thing, it would be my parents while XH is in the army, DB & SIL if my parents were unable to look after DS ie they died/were too old. but either way if DS goes with XH then my parents are to have my say as it as well. (XH has all the usual rights I do)

so far i'm yet to draw up a will.

The man seems a decent chap but i've had no dealing at all with investments/insurances especially.

the £1300 figure is based on my current outgoings per month - rent, council tax, food & other bills.

the blokes eyes did seem to glee a bit when I told him the level of investment I was willing to do.

I am slightly concerned about how they achieve their money. So far i've signed for them to set me up with an account and thats all, not paid any money over at all. apparently I would pay them a fee each month & they divide it up.

I've just looked on the web site, & by the looks of it they have 'associates' and not all of their staff members are 'fully versed' ie what I would expect - ie finance/business degree etc, they could be anyone with the training the company provides.

He cold called yes and showed me the edward jones card, plus his drivers licence to prove his address.

If I chose not to go with this company at all, how do I proceed with that/cancelling things? as I say so far i'm mulling over my options.

I'm keen to get something in place thou.

[thesouthsbelle]

god it gets worse, money saving forums hate the company. the chap I saw 'introduced himself' and as such the fsa don't see that as touting/selling on the door stop apparently.

[LadyMuck]

Have a look at the the unbiased website which will give you the names of local IFAs. I believe that you can select which areas of advice you are most interested in.

Have an initial meeting with at least a couple of them. You'll get some different ideas, and can see who you get on with, and who understands your situation.

They will also be able to review any paperwork that you have already signed and see what, if anything, is necessary to terminate what has been put in place.

[ApuskiDusky]

Just wanted to post that I have dealt with my local Edward Jones advisor, and I haven't any complaints at all. He is very conscientious, did lots of following up and chasing when there were issues about my life insurance, and as far as I'm concerned, earned his commission.

I understand they have been doing quite a lot of recruitment, so I'd want to be confident that my specific advisor knew what he was talking about, because some won't be very experienced.

[thesouthsbelle]

thanks lady muck. my parents keep telling me to go witht he bank and get a cash isa, but I do want some return, my main concern is that the EJ advisors don't seem to have too much training, is there anyway to find out what level of training my chappy has without going to the company directly?

I know he's not personally registered with the FSA as he said the company were so he didn't need to be - this seemed reasonable to me when I thought it was a company employee, however it looks to be more of a 'work from home independently franchise' type thing.

ad - good you had a good experience, from what i've read there's only about 3/4 good reports so far.

have asked my brother to talk to cousin in general terms about the company their selves - as a city worker he should hear some things??

The chap took everything back with him to his office. all I have is my account number with them. and teh details of the policy (well potential policy)

[lobsters]

It sounds strange to me that he's not individually FSA registered, I'm desperately trying to remember the rules, but generally anyone selling investment products, which include life insurance need to be individually FSA registered as well as the company. If he is just selling mortgages and/ or term insurance then he doesn't need to be individually registered.

As a minimum a financial advisor should have a Financial Planning Certificate, which has recently changed it's name to the Certificate of Finanical Planning. This is bacially the equivalent of a GCSE. There are higher levels, there is a diploma, and then chartered status.

As a mininum he should have explained the following to you, do you know the answers to these questions. If not ask him, and also follow the advice about looking on unbiased.co.uk, see some IFAs as well, they should give you an inital free consultation:

• How will he be paid? Is it comission or do you pay a fee? If you are paying a fee, will he or the company still recieve any comission?
  
  
• What products does he have access to? Is it just Edward Jones products, from a limited range across the market from the entire market?
  
  
• Is the policy he is recommeding term assurance or whole of life (IE if you don't claim is there a value at the end of the life of the product)?
  
  
• What other products has he considered? Can he produce evidence of other research he has done?
  
  Remember you (probably) wouldn;t buy a house or a car by just looking at one and only looking into one option, so why do it with a big issue like sorting out your DS financial future, get a second opinion.
  
  Let me know if you have any more questions. Personally the not being individually registered bit would ring alarm bells for me

[Swedes]

Oh please don't get a cash ISA.

If you have a mortgage you are better off paying down your mortgage, as the interest rate you pay on your mortgage will be greater than the Cash ISA interest rate.

[thesouthsbelle]

lobster it for with me, however I wasn't sure if his job was like mine - I can do accounts all the way, but am not allowed to sign them off as I don't have the ACCA/CIMA qualification, so I wondered if the ifa rules were the same?

my cousin is going to be asking about in work tomorrow for me as to the company, whilst we're talking i'll ask him if he has any ideas (he's in investment banker in HSBC who's used to dealing with investments starting at £100K apparently, but more the highre end of the scale. I know he's got proper qualifications as we were studying at the same time (I however fell for DS and stopped my ACCA mid way while he did all of it (ontop of the degree)

re commissions he gave me a sheet hich has their rates on it - basically the max they will charge.

he said he was new starting out yes.

by al accounts he's been looking at the whole span of products and they have a team of analysts checking into everything? also a legal team etc who keep everything above board.

god i'm getting worried by the minute, they seemed a good option when he knocked on the door.

How can I get out of going with them? - I can do with the investment thing, as I have subsequently decided on treating DS to a holiday - i've not had one in 6 years and he's never had one. plus I want to get new bedroom/front room furniture. so will look into it properly now and decided for after xmas - with a view to getting a pension sorted out as well. at 27 I'm getting on a bit in terms of leaving it too late to get one, and want to start as early as possible to have everything sorted out.

[thesouthsbelle]

ok chap's card says 'stock broker & finacial advisor' slightly worried as I thought they were 2 very different jobs, and 2 very different specialities.

[lobsters]

Someone with that kind of title should be individually registered.

This is the FSA website, it explains about life insurance, it should also give you an idea about how financial advisors work. I'm not saying he is giving you bad advice just that it is worth shopping around.

www.moneymadeclear.fsa.gov.uk/guides/family/having_a_baby.html#planning

[SomeGuy]

Hargreaves Lansdown is better for buying Unit Trusts and OEICs (which are basically Unit Trusts remodelled for the independent investor (i.e. eliminating the buy/sell price, which hid commission payments to the financial adviser) than shares - for shares they have a 0.58% annual charge, which is rather steep IMO. For UTs/OEICs, this usually does not apply, because they receive platform and trail commission from the fund issuer.

Funds are more suitable for individual investors anyway, as 7 * £1000 investments is very poorly diversified - a typical fund will have dozens of underlying holdings.

I do have a HL ISA, but also one with Selftrade, who are actually better for shares and ETFs, since they charge only £35 annual fee for all your accounts (cheaper than HL if you have more than £7k in shares/non-commission-paying UTS or OEICs/ETFs), and a flat £12.50 dealing charge.

[SomeGuy]

I would not touch the door-to-door chap btw, they are salesmen with targets, nothing more, seem to have a poor rep.

I don't like the CTF that much, and it might be worth investing privately, depending on how good your CTF is - a low-cost all-share tracker fund is a good option for the long term.

Would spec out life insurance here: www.moneysupermarket.com/insurance/

I bet you get a much better quote.

Does your employer have a pension scheme? Check if they will match your contributions, or if the scheme is otherwise beneficial. If so, you should put as much as you can there, as you could potentially be doubling your money.

[duke748]

I used to work for Edward Jones. They are an American company and 'door knocking' is much more common there.

He will be qualified to CF level (the standard needed to advise). The training there is actually very good and he will probably be very good at reviewing your needs over time.

A stockbroker can advise on buying individual shares and a financial adviser can advise on other investment products and life insurance etc. In the US its much more common for people to buy individual shares than here in the UK.

He will be individually registered with the FSA. Check out www.fsa.gov.uk/register/indivSearchForm.do;jsessionid=26b18047524e4fbfa25191b764503ad4.s6fNml1Ka38In Bbv-ArJrwTPoNCNa30Ocybtah0IaNuIahiIbh0IaNfwmxiInxiObk9ynhvybMSHc30Ka2aToi5hch0Na2TSn7bvq70KawTAqQ4In QXQ-BjF8NaPc3uNbMbMnkrDqRfzqwbMnkrDqRfzqwbynknvrkLOlQzNp65In0__

It will tell you where he has worked before and how long he has been advising.

Jones have a panel of several insurance companies and will be able to pick out the cheapest for you. If you are happy that the policy meets your needs, it will be the most cost effective.

Also - when someone said that he will be on commission - most financial advisers are. Most IFAs are on 100% commission and most bank based tied advisers are on a salary and a good adviser can earn their salary again in bonuses.

Usually similar products pay the same or similar commission, so there really isn't any reason for them to suggest one provider over the other.

Its also a very highly regulated industry, so it would be difficult for someone to sell you something that wasn't right as they would have to provide a report as to why it was the most suitable for you.

As I said, I used to work at Edward Jones and now work for another company. I left there as I didn't think the American model of 'door knocking' was very effective. I love being a financial adviser and would be happy to answer any other questions.

[SomeGuy]

There are quite a few posts on Edward Jones here:

www.google.co.uk/search?hl=en&q=edward+jones+site%3Aforums.moneysavingexpert.com&meta=

With IFAs you can opt for fee-based advice, which can allow them to sell non-commission products, such as low-cost trackers.

Also some products carry very high commissions, which can lead to a conflict of interest, e.g., investment bonds.

[mumadoo]

Hiya,

I had no idea where to start with these things but i found a great site that explains things simply. It's called www.investment-advice-online.com and its in language i can understand!!!

hope this helps

[Whippet]

mumadoo
Do you work for/ own www.investment-advice-online.com by any chance?

You have posted on multiple threads today about how wonderful it is...

It's all a bit obvious IMHO.

Did you know that advertisers have to pay a fee?