Consumers believe financial advisers charge too much commission and they are worried about hidden charges, claims a report from the Financial Services Consumer Panel.
The Consumers in the Financial Market annual survey questioned over 1,100 con- sumers and says charges provoke greatest dissatisfaction.
The report says this tarnishes an otherwise favourable impression of advisers.
Most consumers considered charges and commission levied on products to have been explained well but 12 per cent claimed the adviser did not discuss commission.
The report says: “The omission of such vital facts could have grave consequences for the consumers.”
The survey shows 52 per cent think past performance is a good guide to how investments will do in the future, contradicting the FSA's decision to omit past performance from its comparative tables.
It reveals 30 per cent on the lowest incomes of £6,499 or less believe the best time to invest in a pension is in your 40s. This compares with a figure of just 7 per cent for those earning over £25,000 who agreed this is the best time to build up a retirement income.
Panel chairman Colin Brown says: “We agree with the FSA's decision not to include past performance.”
Syndaxi director Robert Reid says: “The IFAs' biggest problem is that the client does not always understand what he does. In many cases, especially with smaller investments, commission is insufficient.”
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