Sometime back in April I was invited to a music recital in one of the churches in Little Venice, I remember it being quite cold for the time of the year and wondering how on earth the performers were going to cope with the chilliness of the church. In particular the female performers looked as though they would freeze wearing only their sleeveless ballgowns.
The audience were generally wrapped up well, and we had been fortified with a glass or two of red wine to help take the chill off - very thoughtful. And so the evening commenced with an eclectic mix of violin and piano pieces, including a world premier of a recent composition by a contemporary Japanese composer.
Finally after an hour or so the music ended and the real purpose of the evening unfolded - sponsorship of the forthcoming (sixth) Little Venice Music Festival in September. I suppose I had an inkling there would be a call for financial help, after all until quite recently Virginia and I had been neighbours (Virginia is one of the key organisors of the concert), so I knew they were always looking for some financial assistance.
So after an enjoyable evening we were being asked to dig deep into our pockets. The amount of money needed wasn’t a huge amount, but their appeals were largely falling on deaf ears, and so we stepped in as the principle sponsor to support the event.
Looking back I’m not entirely sure why, it must have been the wine! Besides I don’t even live in Little Venice these days. However, music is something to be enjoyed and there is little enough community spirit and involvement - or so were told. The Little Venice Music Festival seems to tick so many boxes - and surplus proceeds would go to the nearby St Mary’s Hospital - it seemed harder not to help!
Of course, being the principle sponsor does come with some priviledges, including a number of tickets to each performance. We will be offered these to our clients as soon as we have the final details. In the meantime, anyone wanting to learn more about this year’s festival should visit the Little Venice Music Festival website.
Dennis Hall gives financial advice to a twenty something buy-to-let investor in The Times.
Sara Turner owns “a two bedroom house…has a devoted boyfriend and recently landed her dream job in travel journalism after an ‘amazing’ year touring India.”
Unfortunately it doesn’t look as if Sara’s finances could cope with any stress, such as periods where her property was not generating any rental income.
You can read the complete article including Dennis’ advice on the money section of The Times website.
Dennis Hall comments on asset allocation and the correlation between asset classes, noting the recent convergence in returns between property and equity.
Asset allocation becomes even trickier when the issue of which asset classes are non-correlated is considered. Over the past year, as the credit crunch has taken hold, some asset classes that are usually thought to be non-correlated - property and equities, for example - have in fact fallen at the same time.
Dennis Hall, a financial adviser at Yellowtail, suggests that the recent convergence may be because property has been treated more as an equity, with people investing in it for capital growth rather than for its long-term rising rental yield.
You can read the entire article on the FT website.
Dennis Hall comments in an article for the Financial Times in their Weekend Money Supplement.
Discussing multi-asset funds - basically funds that invest in all the main asset classes including equities, bonds, property and cash - Dennis states that financial advisers are likely to recommend these funds to clients because it “takes the burden of asset allocation off their shoulders.”
You can read the rest of the article on the Financial Times website.
We asked…and our clients and partners answered. Kicking-off our seminar programme with a breakfast seminar in November, we wanted to know what the issues affecting you currently are, and plan our first session around your responses.
We asked which of these topics would be most relevant (and the votes are in):
1. How to retire early (31% of the votes)
2. Providing an inheritance for future generations (16%)
3 How to invest in times of trouble (53%)
We had a really good response to our survey with a lot of alternative suggestions as well. All the responses and suggestions will be used to shape our programme going forward.
For our blog readers out there– we’d also be interested in your comments. What topic would be top of your list?
Answers on a post card (or easier still, using the comments form below).
It is clearly the attitude of the product providers (the insurance companies and the investment firms) that in the world of financial advice, fees continue to play second fiddle to commission.
And if all the firms that pass themselves off as independent financial advisers are actually offering their clients the option of paying a fee, then why is full commission still the default option on the illustrations offered by providers?
The difference in policy premiums between an insurance quote issued without commission compared to a quote with commission can be significant, on some illustrations we recently looked at premiums had been hiked by more than 30% to pay the commission. Yet whilst that’s a lot of money, it isn’t what I’m talking about today.
The issue is this; because commission is so embedded into the way products are sold it is the default option for many product providers, and it creates so much extra work for firms like us, who work entirely on a fee basis.
Whether it is the initial request for an illustration, or the physical processing of an application on which we have asked for nil commission terms, I am surprised at how often the instruction is ignored. This causes more work because we then need to ask for replacement illustrations without commission, or in some cases we have to return policy documents which have been issued on the basis that commission will be paid – we don’t want it!
We have an agreement with our clients to work on a time/cost basis, so surely the client should not have to pay more for the time spent correcting product provider errors. Certainly we would not feel justified passing on these costs to the client, but it’s the devil’s own job trying to get any compensation out of providers.
So when can we expect this move to fees to actually filter into the world of the product provider? If an adviser wants commission from selling a policy I am sure they will ask for it.
Our blog and Dennis Hall’s Random thoughts from a financial planner are mentioned in a Citywire article as 2 blogs that are “well worth reading.”
Just for your peace of mind that quote wasn’t taken out of context as so many theatre reviews are - the article’s author Richard Lander seems to actually mean it!
Dennis Hall wrote an article containing Top Ten Tips for Worried Investors.
Are you worried about the markets? Thinking of cashing in your chips at the investment casino? It’s been a dreadful year for most investors, and the last few weeks have been particularly dire.
His advice is to stay calm and bear his points in mind. You can read the rest of the Top Ten Tips for Worried Investors in the articles section of our website.
In one of the trade papers Clerical Medical comes under fire for axing trail commission, briefly, a story about Clerical Medical ceasing to pay the ongoing trail commission to advisers that no longer provide a service (I cover trail commission in another blog article called what is commission). Anyone that knows me will understand that I am unlikely to get upset about this decision from Clerical Medical, however after some discussion with them earlier this year this does come as a bit of a smack in the face.
Why? Well earlier this year we asked Clerical Medical to stop paying trail commission on our clients policies and pension plans. Because of our 100% fee only model, commission, whether paid at the outset or ongoing, was no longer part of our charging regime. We can stop trail commission said Clerical Medical. So to clarify things we asked exactly how our clients charges would reduce. Our thinking was; if part of the annual management charge is simply paid to us, then surely if we no longer received it their would be a corresponding reduction in the level of charges.
Er, no! Clerical Medical were going to keep it.
A conundrum, what should we do? In the end we found the clients a cheaper product, one paying no commission, and we arranged to switch the contracts free of charge. What a waste of time and effort, and a display of greed from Clerical Medical - an accusation from other advisers following this current action.
Returning to the article; I am dismayed by some of the comments from advisers hitting out at Clerical Medical. One adviser, who shall remain nameless said the following “The client they have removed my trail from has not done business with me for years but if they asked for advice on financial planning, I would provide it. Will Clerical do that? Will they offer fair, unbiased advice on their with-profits fund, for example, if the situation comes about?”
Morally what right does this adviser have to continue taking money from someone who no longer appears to have a relationship for advice? And why are clients still in the Clerical Medical With Profits Fund? They’ve been taking the trail commission yet not giving advice on a defunct fund. Ignoring a fund that has returned virtually nothing throughout the raging bull markets post 2003 is an admission of abject failure. And that’s what’s wrong with commission!
Retirement planning seems to be one of the more difficult things we do when managing our personal lives. This may be because retirement planning is so long range – peering far into the future is not something my brain was designed to do.
Our Government is very keen that we all take retirement planning very seriously, and so have provided a swath of information now accessible online. On the Directgov website, they even show their caring, sharing side with a how retirement will feel article.
Retirement is a challenging new phase in life. While it ranks high on the scale of stressful life events, it also provides the opportunity to enjoy a new lease of life. You are likely to enjoy the freedom to develop new interests but on the other hand may feel lonely, isolated and bored at times. An important step is to plan your goals and work towards them.
With my retirement planning I am looking forward to enjoying a new lease of life!
The retirement planning approach they recommend is rare in our industry – but at Yellowtail it is the way we choose to work with all our clients. We work to understand your goals and values and then create a plan to help you achieve them – to me there is nothing more rewarding than working with clients to help them achieve their retirement goals.
Now for a shameless plug –if you are looking for help with retirement planning read about the Yellowtail approach to retirement planning on the site, and then feel free to contact us to find out more
