As financial advice industry is shaken up, more consumers head online
Sunday 27 November 2011
Paul Atkins, 37, from Norwich is typical of millions of Britons. He wants to do what's best for his partner and two daughters but isn't sure of where to get the right advice.
"I have always tried to do my own finances but feel that I need a second pair of eyes to look over my plans. Standard financial advice seems so expensive and I'm worried about being mis-sold." With the financial advice industry's long track record of pensions, endowments and investment mis-selling, Mr Atkins's reticence is understandable.
"I don't like the idea that advisers are paid by banks and insurers for products they sell to me, but on the other hand up-front fees for advice can be very high."
He sees the benefit of advice but doesn't want the expense that goes with it. With the paying of commission to advisers to be banned by the end of 2012, choice is about to get a whole lot worse for people like Mr Atkins.
"The banning of commission will mean that lots of financial advice firms are migrating up to target high-net-worth individuals, leaving an advice gap of potentially millions of disenfranchised people, the squeezed middle," said Martin Peterlechner, the head of marketing at new launch financial advice site Moneyvista.com.
Mr Atkins, as a production manager in the food industry, is part of this squeezed middle. He has signed up to Moneyvista's new service, which promises to help consumers plot how they fund future financial goals.
"My daughters are only six and eight but already I am concerned over how to fund them through university. Moneyvista helps me plan my finances to put enough aside while also laying out how my retirement pot is going. I like the fact that it doesn't try to sell me a product."
Moneyvista is a new breed of website designed to offer users a clearer view of their finances and focus them on their goals but are backed by professional advisers. No commissions are collected from product providers but subscribers, after an initial 30-day free trial, pay from £8 a month or £75 for a year.
"Users can enter information about their personal finances into one place and we show customers where they are now and what there financial future is likely to be," said Mr Peterlechner. "Although we are not offering a regulated advice service, we monitor the value of investments and keep customers alerted to tax changes and if their investments aren't performing sufficiently to pay for their long-term goals."
But some aren't convinced that the Moneyvista model will work.
"The difficulty will be getting people to commit to paying £8 monthly or £75 a year for this online service. Some of the calculators and guides on the site are available elsewhere for free," said Andrew Hagger from financial comparison service Moneynet. "I think it will appeal to those who are more hands on with their own financial affairs, but I still think many people will prefer to sit down with a professional adviser to discuss their options face to face – even if it ends up costing them more."
Mr Hagger did point out, though, that it was "refreshing" that Moneyvista was free from advertising and wasn't trying to push people on to a particular product.
As the banning of commission selling approaches, more sites like Moneyvista will go live, and the Financial Services Authority money advice service has been up and running since April.
"The FSA's service gives people a good grounding and services like ours and those which will come into this space is the next step up from this," Mr Peterlechner said.
Independent Partners: Search our directory to find Independent Financial Advisers (IFAs) who have been rated and reviewed by their clients. Find out more
Independent Partners; request a free guide on NISAs from Hargreaves Lansdown
Newcastle winger is in Argentina having chemotherapy
Actors star in Woody Allen's 'Magic in the Moonlight'
Human faces unique 'because we don't recognise each other by smell'
Man's attempt to avoid being impounded heavily criticised
Returning to the stage after 20 years makes actress feel 'nauseous'
- 1 Scottish independence: Ireland since 1919 is a lesson for Scotland in what a Yes vote means
- 2 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 3 Say yes to 'no-poo': It's been three years since I stopped washing my hair
- 4 Grandmas keep accidentally tagging themselves as Grandmaster Flash on Facebook
- 5 Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
The political class is doing what Hitler couldn’t – destroying Britain
Scottish independence referendum: A nation divided against itself
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
Portuguese academic says British are 'filthy, violent and drunk'
iJobs Money & Business
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
£20000 - £25000 per annum + OTE £35,000 first year: SThree: The SThree group i...
£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...
£20 - 24k + Benefits: Guru Careers: This is a great opportunity for an enthusi...
Day In a Page
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green
Look forward to a brighter future at two-bedroom Sunny Cottages, ideal for Londoners looking to downsize
A three-bedroom red-brick cottage with outbuildings and pretty gardens, £200,000
This three-bedroom flat within a former textile factory spans the corner of the fourth floor and has a balcony