I have been offered an investment by my Financial Adviser, are Sterling and Skandia safe?

Question

I have been offered an investment by my Financial Adviser, she suggests I split my money between Sterling and Skandia. I've never heard of either company, is my money safe?

Answer 1

OK assuming that the adviser isn't my boss go back with plank of 4x2 and hit her over the head until she explains what she is doing in a way that you understand, heck if it takes little pictures of hand drawn stick men i keep explaining till my clients can tell me exactly what and why they are investing in!
nothing in financial services is so complicated that a 5 year old cant get a basic grasp if its explained the right way.

Sterling assurance is the 'posh' arm of Zurich financial services and offer multiple fund houses within their products so a sterling investment can had over 100 other fund houses actually running the money, nothing wrong with them at all just be careful with the charges.
Skandia are a good quality product provider now owned by Old Mutual from south Africa, Skandia products offer access to over 500 different funds from multiple fund managers, very good product offering almost infinite diversification.
Again they only issue can be the levels of charges but given your adviser is recommending these plans i would guess they are an IFA so you could if you want pay a fee, on a fee basis both providers offer excellent value and top quality.
Trust your IFA just make sure they take the time to explain what and why they are doing for you , they do it all the time , some times we forget that our clients are not so familiar with our wizzy ideas.

Answer 2

Before you fire the advisor look at the investments you are in. If you inherited the account from your grandfather it is likely that the money was invested extremely conservatively (such as in bank certificates or money markets). This is because old people tend not to have their money in the stock market due to the risk. The stock market is only appropriate if you have a very long time to invest (25 years or more). Given that bank certificates and money markets are currently earning extremely low interest rates it is possible that your account could be slightly down after fees. If your account is invested in the stock market you should look for another advisor - stocks have performed well over the past 18 months and your account probably should be up. Take a look at your statements and figure out what you are invested in. If nothing has changed since you inherited the money you should visit with your advisor to make a change. Sorry I can't be more helpful, but I would need to know what you are invested in and why before I could tell whether or not the performance is worse than would be expected.

Answer 3

Financial AdvisEr or Financial AdvisOr. There is a difference that is too often ignored as being pedantic, much to the chagrin of novice investors. 2 investments is not a good spread. An Advisor would recommend split your capital savings into at least 6 investments for safety. If "safe" is paramount then it might be better if you put your savings in a deposit account until you are more knowledgeable about the Stock Market. Independent responsibility is essential.

Answer 4

A Financial Adviser is supposed to set you up with an "Asset Allocation"...... This protects you from any major "blowup" in a stock.

Imagine if you had 50% of your money in Ford and 50% of your money in Enron seven years ago. No one expected anything but further gains in Enron (now it's worth nothing). This was one of the largest companies in the USA & was always considered "safe".

Also;
Your advisor is supposed to make sure you understand their investment suggestions. NEVER EVER invest in anything you don't understand.

Answer 5

It is the job of financial advisers to give you all the information on the companies they recommend, including dividend history, dividend cover, P/E ratio, cash flow, gearing etc. Also broker opinion and directors transactions.

It seems to me your FA is either very ignorant or very lazy. Acting like that she putting her self at risk for a possible claim for compensation if you lose money.

Answer 6

Skandia are a large multi national - I don't have any knowledge of Sterling.

Answer 7

I think they're safe - but it's your financial adviser's job to provide you with enough information to enable you to make an informed choice. Ask her to convince you.

Answer 8

Ask them what's in it for them commissionwise.