I'm not a fan of using an IFA and have never used one. Commission charges do of course eat into your returns and many products designed by the finance industry shamelessly take more than they should over time.
Self management at cheapest cost is the way to go.
However, as has been pointed out above, Not everyone can do that. I know, at a guess, about 200 people. I am almost certain that other than the 4 people in my little share club, not one of those people read the Mötley Fool and as far as I know not one of them truly manages their money other than switching bank accounts occasionally. Whenever I talk money at dinner parties or actual parties etc, the almost universal reply from people is that they don't understand savings accounts and ISAs let alone shares and pensions.
These are not dumb people. This weekend I had this conversation with two doctor friends, last week with my retired ex senior advertising executive neighbour.
I know an IFA who has recently retired, as he says that he knows people will not pay the sort of rates that he would need to get a decent living, unless he trebles his client base. I have little sympathy here as it does suggest he gets more than he should from hi commission based sales.
However, his point is that he has offered fee refunds for years in option against fixed hourly rate advice, and other than a very few, already well informed and indeed rich clients, every single "man in the street" opted for the commission based charging instead of a £60 per hour fixed rate for advice.
I fear that we are in for trouble ahead, as the great British public shun all advice on what to do with their money, and henceforth either spend it, bang it in the bank or B/S, or buy bank sold products because they are the only game in town.
Easy to disparage IFAs on a money based site that probably less than 1/10th of the population have even heard of.
Trouble ahead, I feel.
Tony
