FAQs

  • Bob Little & Co Ltd FAQs

    • How do I pay for advice?

      We have two main payment options for our advice: fees and commission. The difference between these two options is that commission is paid to an adviser via a third party (eg a product provider) and fees are paid directly by the person receiving financial advice (you).

      Please note that our advisers do not keep any fees or commissions. Instead all fees and commissions are paid to our company then our advisers are employed and paid a salary. This helps to ensure that our advice is impartial and in your best interests.

      Mortgages

      • You will have a free initial consultation with an adviser
      • Your adviser will explain how you will pay for our advice. This will typically be a combination of a fee plus a commission (also referred to as a mortgage procuration fee)
      • The commission is paid from the mortgage provider to Bob Little & Co Ltd when your mortgage completes. We do not receive this commission if your mortgage does not complete
      • You will be told the amount of commission we will receive and the amount of the fee you will pay and you will be asked to sign to confirm this. Until you sign these documents you will not incur any fees payable to our company.

      Investments, Savings and Pensions

      • You will have a free initial consultation with an adviser
      • Your adviser will explain how you will pay for our advice. In almost all circumstances you will pay us a fee for our advice (rather than a commission).
      • This fee could be a flat fee depending on the number of hours involved (eg £100) or it could be a percentage of your investment amount (eg 2%). This fee can be paid in a number of ways, such as by cheque, by card or by deduction from your investments. You can agree your preferred payment method with your adviser.
      • Sometimes (but not always) your adviser will recommend regular reviews of your investments. This is to ensure the investments are monitored closely and to update you about any changes in legislation or investment markets which may affect you. If you and your adviser agree that these regular reviews are appropriate you will pay us a fee for this service. This could be a flat fee or a percentage of your investments. This can be paid by cheque, by card or by deduction from your investments.
      • Your adviser will make it very clear what you are paying these fees for (eg for a one-off transaction or for an ongoing service). They will also ensure you are happy with the most appropriate method of paying these fees
      • You will be told the amount you will pay and you will be asked to sign to confirm this. Until you sign these documents you will not incur any fees payable to our company.

      Protection (eg Life Cover)

      • You will have a free initial consultation with an adviser
      • We will normally be paid a commission by a product provider if you choose to take out a product. This commission is based on the premium you will pay to the product provider
      • Alternatively, you have the choice of paying a fee to our company, in which case we will refund the amount of commission back to you
      • We will not receive this commission until your product is in place
      • You will be told the amount of commission we will receive and you will be asked to sign to confirm this. Until you sign these documents you will not incur any fees payable to our company
    • What does “Independent” mean?

      There are two types of financial adviser in the UK: “Restricted” and “Independent”. Bob Little & Co Ltd offer Independent advice

      This means we are able to access all products available in the intermediary marketplace. It also means we do ongoing research on all of these products.

      In contrast, a “Restricted” adviser will only offer you access to a small range of products or companies. This means you will only get the best product from their limited range, rather than the best product available to you.

      By using an Independent adviser you can be confident that you are getting advice which is truly best for you and your circumstances.

    • What happens in the first appointment with an adviser?

      You will be asked to bring various documents with you to provide your adviser with as much information as possible (such as wage slips for mortgage advice or copies of existing policies for investment advice).

      You adviser will discuss our “Terms and Conditions of Business”, our “Service Propositions” and our “Key Facts About Our Services” documents with you (as appropriate). Your adviser will then complete a “fact find questionnaire,” which records a snapshot of your current circumstances and asks some questions about your financial goals for the future.

      Your adviser will then give you a brief outline about how we can help you. At this point you have three options:

      • If you are confident that you will benefit from our advice, your adviser will arrange a second appointment with you. This appointment will normally be at no cost to you (unless agreed otherwise in the first meeting).
      • If you feel that you will not benefit from our advice there will be no fee payable for the initial meeting and any data we hold about you will be held under strict confidence in accordance with the Data Protection Act. You will not receive any further correspondence from us.
      • If you feel that you will benefit from our advice in the future, but not at the present, you can give permission to your adviser to contact you in the future. You will not receive any correspondence from us in the meantime.
      • Before the second meeting your adviser will perform any research needed to prepare for your next appointment. They will also prepare an “action plan”, which details the steps you should take to meet your goals.

      Throughout this process you will be encouraged to ask as many questions as possible about our services and the products we may recommend.

    • Why should I choose Bob Little & Co Ltd over a bank adviser?

      There are two types of financial adviser in the UK: “Restricted” and “Independent”. Bob Little & Co Ltd offer “Independent” Advice and a lot of banks offer “Restricted” advice.

      This means we are able to access all investment and pension products available in the intermediary marketplace. It also means we do ongoing research on all of these products.

      In contrast, a “Restricted” adviser will only offer you access to a small range of products or companies. This means you will only get the best product from their limited range, rather than the best product available to you.

      By using an Independent adviser you can be confident that you are getting advice which is truly best for you and your circumstances.

      List of UK banks and their advice propositions:

      Bank Advice Offered
      Barclays None
      C&G None
      Clydesdale Bank None
      Halifax None
      HSBC Restricted
      Lloyds TSB Restricted, must have over £100,000
      Nationwide Restricted
      RBS Restricted, must have over £360,000
      Santander Restricted, must have over £50,000
      Yorkshire Bank None

      Many banks and building societies stopped offering financial advice in late 2012 and early 2013.

    • Why should I choose Bob Little & Co Ltd over another IFA?

      We are Chartered Financial Planners, which sets us apart from other non-Chartered IFA practices. You can read more about this here: Chartered.

      We also feel our customer service sets us apart from other companies. We have never had to rely on advertising or marketing gimmicks to attract new clients to the business because over the years we have had so many recommendations and referrals from satisfied customers.

  • Investment FAQs

    • What is a NISA?

      NISA stands for New Individual Savings Account. There are two versions available: Stocks & Shares NISAs and Cash NISAs. Technically, you can hold a mixture of both stocks and shares and cash in a single NISA account, but in reality some providers will not allow this. The benefit of a NISA is that any interest earned on a Cash NISA is not taxable and any profit made on a Stocks and Shares NISA is not taxable. You can invest up to a total of £20,000 in a NISA in the 2017/18 tax year. This can be in any combination of stocks and shares and cash.

      You can transfer money between NISAs without using up any more of your NISA allowance for the year.

    • What is an Investment Bond?

      An investment bond is another type of tax wrapper in which you can hold investments. Other examples of tax wrappers are ISAs and Pensions. An investment bond normally allows you to invest a lump sum or a regular investment amount into various types of investment choices. You can then normally take a tax-free or tax-deferred income of 5% per annum of the original investment amount. The bond should grow in value while it is invested, but this is normally dependent on market returns and you could get back less than you invested.

      Different providers offer different features with their bonds, such as early encashment penalties, different fund choices and guarantee options (where you will not get back less than you invested). There are many pros and cons of using an investment bond over another type of tax wrapper and this should always be discussed with an adviser.

  • Mortgage FAQs

    • Can I get a mortgage now that I am retired?

      Possibly, as long as your pensionable income can support the mortgage. Be aware that most lenders expect the mortgage to be repaid by the age of 75.

    • Do I need a deposit?

      Yes, typically at least 5-10% of the purchase price is required.

    • How many years can I take a mortgage over?

      Mortgages can be set up between five and 35-year terms. Be aware that the longer the mortgage term, the more interest payable.

    • How much can I borrow?

      This varies significantly between lenders and it is dependent on a number of factors such as your property value, property type, income and credit history.

      One of our advisers will recommend a suitable lender for you and then assess how much you can afford to borrow from this lender.

    • I have had some credit problems recently – can I still apply for a mortgage?

      Possibly, it really depends on the level of debt and when and why the problems occured. You can discuss this with one of our advisers.

    • What is equity?

      The equity in a property is the value of the property less any mortgages outstanding. So a £75,000 mortgage on a £100,000 house gives equity of £25,000.

    • What is loan-to-value (LTV)?

      LTV is the amount borrowed in relation to the value of your home (eg a £75,000 mortgage on a £100,000 house gives a LTV of 75%.)

      The best mortgage deals available on the market are at lower LTVs, which reflects the lower risk to the lender due to the greater equity in the property.

    • Why can’t I get a bigger mortgage even though I can afford to pay more in rent?

      Lenders assess whether you can afford the mortgage both now and in the foreseeable future and the impact of future interest rates increases. There are also other costs to consider in owning your own home which you would not pay in rented accommodation.

  • Tax FAQs

    • What is Capital Gains Tax (CGT)?

      This is essentially a tax on profits made on an investment. For example, if you purchased shares for £100,000 and then sold them for £200,000 you may be liable to pay Capital Gains Tax on some the profit.

      The rules regarding Capital Gains Tax are very complex. One of our advisers can help you find out if you have a liability to Capital Gains tax and can refer you to a specialist if this is required.

    • What is Inheritance Tax (IHT)?

      Inheritance Tax is levied on the value of a person’s estate after they have passed away. There are various allowances and reliefs available and the rules can be very complex. Generally you will not be liable to pay Inheritance Tax as long as your estate on death is less than £325,000 (possibly up to £425,000 if you own a home worth £100,000 or more and you leave this to your children or grandchildren). If it exceeds this amount, you may be liable to pay tax of up to 40% on the remainder.

      One of our advisers can discuss Inheritance Tax planning with you and can refer you on to a specialist if your tax planning requirements are very complex.

      Read more: Inheritance Tax Planning