Question
Question Re: Trail Commissions
I inherited some unit trusts and have no idea whether I am being charged a trail commission since I never approached a IFA in the first place.
If charges are still being made can I recover them? How do I find out what charges if any are being made and paid to whoever?Answer
To find out whether trail commission is being paid simply phone the unit trust manager(s) and ask whether there's an 'agent', e.g. financial adviser, on the account. If so, ask whether trail commission is paid and, if it is, how much and to whom.
Whether or not trail commission is paid the annual fund charges you pay should be unaffected. But, as you're aware, if you're receiving no service in exchange for trail commission then much better that you pocket this rather a financial adviser. Obviously, if you need advice then you could try asking the existing adviser, or simply move to a new one who'll help in exchange for the trail commission.
You can't recover any previous commissions paid, but you can enjoy trail commission rebates in future by using a discount broker. There's a few, such as Clubfinance and Hargreaves Lansdown that rebate some trail commission, while Cavendish Online rebates it all in exchange for a fee. See our ISA Discounts (the information is also relevant to unit trusts) and Trail Commission Rebates Action Plans for more details.
Assuming trail commission is being paid you simply need to sign a 'transfer of agency' form or letter to divert commission payments to the new broker or adviser – who should be able to supply a suitable form.
Question Re: Trail Commissions
I inherited some unit trusts and have no idea whether I am being charged a trail commission since I never approached a IFA in the first place.
If charges are still being made can I recover them? How do I find out what charges if any are being made and paid to whoever?Answer
To find out whether trail commission is being paid simply phone the unit trust manager(s) and ask whether there's an 'agent', e.g. financial adviser, on the account. If so, ask whether trail commission is paid and, if it is, how much and to whom.
Whether or not trail commission is paid the annual fund charges you pay should be unaffected. But, as you're aware, if you're receiving no service in exchange for trail commission then much better that you pocket this rather a financial adviser. Obviously, if you need advice then you could try asking the existing adviser, or simply move to a new one who'll help in exchange for the trail commission.
You can't recover any previous commissions paid, but you can enjoy trail commission rebates in future by using a discount broker. There's a few, such as Clubfinance and Hargreaves Lansdown that rebate some trail commission, while Cavendish Online rebates it all in exchange for a fee. See our ISA Discounts (the information is also relevant to unit trusts) and Trail Commission Rebates Action Plans for more details.
Assuming trail commission is being paid you simply need to sign a 'transfer of agency' form or letter to divert commission payments to the new broker or adviser – who should be able to supply a suitable form.
Read this Q and A at http://www.candidmoney.com/questions/question164.aspx
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