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Advice re QROPS in UAE

Advice re QROPS in UAE

Old Feb 10th 2015, 9:13 am
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Default Re: Advice re QROPS in UAE

Originally Posted by Meow
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Old Feb 11th 2015, 7:50 am
  #17  
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Default Re: Advice re QROPS in UAE

Originally Posted by Meow
Very few can retire in the UAE but that doesn't necessarily mean they move back to the UK. It is true that too many are 'sold' and are not suitable but that sadly is due to the lack of regulation and compliance in the region. There are too many unqualified, commission chasing salespeople in the UAE. No question that residency in retirement in the main factor to consider and that's why I don't arrange that many.

Quite a few Brits will not retire in the UK so it could be suitable for them and there are also many non Brits who have worked in the UK for many years and accrued pension benefits who are likely to be better off with the monies outside the UK. The cost difference between SIPPs and QROPS has diminished so it's really about suitability for the individual.
Fortunately, from April 6th, final salary transfers for values over 30k will need to be signed off by a qualified UK practitioner- ideally working with a local pension practitioner.

I spotted a UK adviser in Chester on Linkedin change his profile, so I can see your firm has already got something in place for the changes.

That should raise the bar on the advice in these cases- The guy concerned is well known ( for the right reasons! ).
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Old Feb 11th 2015, 8:10 am
  #18  
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
Fortunately, from April 6th, final salary transfers for values over 30k will need to be signed off by a qualified UK practitioner- ideally working with a local pension practitioner.

I spotted a UK adviser in Chester on Linkedin change his profile, so I can see your firm has already got something in place for the changes.

That should raise the bar on the advice in these cases- The guy concerned is well known ( for the right reasons! ).

Like I said, some of us are trying to do the right thing.
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Old Feb 13th 2015, 8:24 am
  #19  
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Default Re: Advice re QROPS in UAE

We have always worked with a Uk adviser on complex large balance transfers to OZ - many do not. With the 30 K limit now for defined benefit scheme transfers it now means an extra cost to the client.... but at least it will get rid of alot of idiots out there
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Old Feb 13th 2015, 8:29 am
  #20  
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Default Re: Advice re QROPS in UAE

Originally Posted by john in oz
We have always worked with a Uk adviser on complex large balance transfers to OZ - many do not. With the 30 K limit now for defined benefit scheme transfers it now means an extra cost to the client.... but at least it will get rid of alot of idiots out there
Hopefully your model will become the norm. Clients get far more protection, all advice is insured and more likely to be correct in the first place because of that.
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Old Feb 19th 2015, 12:06 pm
  #21  
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
Fortunately, from April 6th, final salary transfers for values over 30k will need to be signed off by a qualified UK practitioner- ideally working with a local pension practitioner.
It's not simply a UK qualified practitioner that will need to sign off the advice - it's a UK regulated practitioner.

In my opinion this isn't a good thing. Doesn't it make sense that an individual living in, say France, receives his pension advice from a company that can provide specialist knowledge on the French system? Most UK firms can't and don't do that.

The cost of compliance in the UK pushes up the cost of advice. The quality of the advice isn't necessarily better - the industry just dedicates more resources to protecting itself from claims and litigation - not productive as far as the client is concerned.

(I have been on both sides of the fence - having advised professionally in the UK and offshore).
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Old Feb 19th 2015, 12:27 pm
  #22  
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Default Re: Advice re QROPS in UAE

A UK practitioner has to be regulated.

I am not 100% sure it will push up the advice in many cases. The UK firm will provide a fee based analysis- not hidden commission based remuneration. The costs will be clear and disclosed. If the offshore adviser also agrees a reasonable fee then the total may be a lot less that the 8% the offshore salespeople take when the money is put into an insurance bond ( plus further commission taken on the funds within the not needed insurance bond ).
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Old Feb 19th 2015, 1:22 pm
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
I am not 100% sure it will push up the advice in many cases. The UK firm will provide a fee based analysis- not hidden commission based remuneration. The costs will be clear and disclosed. If the offshore adviser also agrees a reasonable fee then the total may be a lot less that the 8% the offshore salespeople take when the money is put into an insurance bond ( plus further commission taken on the funds within the not needed insurance bond ).
I can only speak from my own experience. I was advising in the UK industry all through the changes from commission to fee-based advice. I saw the pre-RDR and post-RDR worlds before my relatively recent move abroad.

UK IFAs often make the mistake (as did I) of assuming that fee-based advice is the superior model. In fact, clients care most about getting a good service for the charges they pay. Most offshore IFAs will disclose the charges fully and openly. The few that don't are simply fraudulent.

The fact that a UK IFA must show what proportion of the overall cost he/she gets paid is frankly inconsequential. It matters more to the IFA than it does to the client.

It's true that you don't need a bond for a QROPS - but if you don't have one you will still need to pay for an investment platform, and you'll need to pay for advice separately, as per the UK model. In my experience, the UK model is markedly more expensive - and when you see the compliance processes that are involved, it's easy to see why. (I recently received a copy of a QROPS recommendation from a UK adviser that was 49 pages long - pages and pages of discussion about issues that were irrelevant to the client, purely for the sake of satisfying the regulator).

The UK industry has a good emphasis on professionalism that, to some degree, prevents cowboys entering the market. The offshore market is gradually moving in the same direction. Aside from that the UK market is stifled and corrupted by over-regulation.
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Old Feb 19th 2015, 2:07 pm
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Default Re: Advice re QROPS in UAE

Originally Posted by marr
Most offshore IFAs will disclose the charges fully and openly. The few that don't are simply fraudulent.

The fact that a UK IFA must show what proportion of the overall cost he/she gets paid is frankly inconsequential. It matters more to the IFA than it does to the client.

.
My experience is markedly different from yours but perhaps the UAE has higher standards with offshore advice.
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Old Feb 19th 2015, 2:25 pm
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
My experience is markedly different from yours but perhaps the UAE has higher standards with offshore advice.
I'm in Europe - I can't offer much insight on the UAE. I hear though that a lot of advisers there are unregulated.
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Old Feb 21st 2015, 11:29 am
  #26  
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
My experience is markedly different from yours but perhaps the UAE has higher standards with offshore advice.
Sadly the UAE doesn't not have high standards and there are awful products where greedy salespeople can take up to 10% on a bond and then more from certain funds within it. That's just robbery in my view.

An offshore bond (PPB) isn't a bad thing to hold in a SIPP or QROPS but it can be set up with far lower initial commission that are fairer all round. In addition they only work if the right funds are chosen and managed on an ongoing basis and that is not always the case.

At this moment in time there are no regulatory requirements for advisers, only the firms and management. That's why so many are wide boy salespeople with little knowledge, no qualifications or experience and zero regard for their clients. I spend hours trying to pick up the pieces for bad advice.

Very much a case of caveat emptor.
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Old Feb 21st 2015, 11:53 am
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Default Re: Advice re QROPS in UAE

Originally Posted by Meow

At this moment in time there are no regulatory requirements for advisers, only the firms and management. That's why so many are wide boy salespeople with little knowledge, no qualifications or experience and zero regard for their clients. I spend hours trying to pick up the pieces for bad advice.

Very much a case of caveat emptor.
Then the management should be ashamed of themselves, but then I guess they are making so much money that they don't care. I can think of three or four large firms over there that wear this cap.
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Old Feb 21st 2015, 12:18 pm
  #28  
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
Then the management should be ashamed of themselves, but then I guess they are making so much money that they don't care. I can think of three or four large firms over there that wear this cap.
The owners and managers of certain companies are as greedy as their salespeople. It's appalling but I carry on fighting the good fight and doing it properly and fairly. I like to sleep at night and really don't know how some people can.
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Old Feb 21st 2015, 1:16 pm
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Default Re: Advice re QROPS in UAE

Originally Posted by Meow
The owners and managers of certain companies are as greedy as their salespeople. It's appalling but I carry on fighting the good fight and doing it properly and fairly. I like to sleep at night and really don't know how some people can.
Guess that is all you can do, the firms in question stamp on anyone questionning their business model.

If the insurance companies stopped paying such huge commissions up front then that would do a lot to clean up things, but I cannot see that happening anytime soon.
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Old Feb 21st 2015, 2:10 pm
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Default Re: Advice re QROPS in UAE

Originally Posted by Otto The Squid
Guess that is all you can do, the firms in question stamp on anyone questionning their business model.

If the insurance companies stopped paying such huge commissions up front then that would do a lot to clean up things, but I cannot see that happening anytime soon.
Certainly the insurance companies have a lot to answer for. They just take in business in the full knowledge that some of it is questionable. The dreadful 25 year savings plans from certain companies in particular as the persistency rates are appalling.
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