You may not be immediately aware of MFID II headline but it’s causing some changes coming to your pension and investment planning – something that’s not been delivered before – something that should cause you to think again about some of your planning.
For years now the pension and fund management industry, including advisers (independent and otherwise) should have been disclosing accurate charges – you know the amount they levy on your money for managing it on your behalf.
Strange thing is, these charges have been obfuscated (I’ll use a big word because that what the industry does – it means to make obscure, unclear, or unintelligible) for years and it’s taken another bit of EU legislation to force the industry to come clean.
For me I’ve been saying for years that something wasn’t right with the whole financial planning system, it’s not been fit for purpose for a long while; and this change in legislation just cements that even further.
According to the FT (and some of my own research) a large number of UK investment funds have a total cost which is a third more (33%) than the stated charge (OCF) and they have been getting away with it for years.
It’s a bit like asking a plumber to repair a tap, he gives you a fixed price. Only when you come to check your bank statement he’s taken a third more from your account. It should be regarded as theft – only the financial services industry hides behind a layer of administration and paperwork that is deliberately covering up the truth (charges being buried on page 449 of 600 in a really small font) or lost in ten thousands words of utter rubbish.
I’ve always understood that the industry did this and in the last thirty years or so have done my best to tell the truth about the rip-off fees and dire returns many of these providers offer and now it’s taken EU rules to force change.
It will become apparent over the coming months that the Pedigree Pup you paid good money for on the that advice of that qualified Puppy Adviser will turn out to be a farmed dog, with bad hips and awkward breathing – and one that is probably best put down sooner rather than later.
All of these fees will conspire against you, few will be have been disclosed accurately go check yours.
- Fund Fees
- Adviser Fees
- Provider Fees
- Management Fees
If you ever wondered why the returns on your pension and ISA’s were so dire then then go check the above.
I have produced a couple of tools to help you understand these charges and this starts with a Borrow my Brain.
https://www.thefinancezone.co.uk/product/borrow-my-brain/ this alone is likely to be worth many tens of thousands of pounds in reduced charges for you.
Don’t ignore these important changes, taking control of your personal financial situation has never been more important or easier. The sooner you act the sooner you can start to benefit.
Richard
PS Don’t forget, if you are looking to book a speaker for your events then get in touch. For an irreverent and a truthful look at modern financial planning issues. https://www.thefinancezone.co.uk/contact
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