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Learning, Sharing, and Teaching => Investor Alley => Topic started by: dungoofed on March 27, 2014, 08:27:46 AM

Title: Royal London 360 - I dun goofed
Post by: dungoofed on March 27, 2014, 08:27:46 AM
[---Moderator note from MMM:

As of February 2016, this company (RL360) has filed a lawsuit in Arizona against this website. Since I've never written about the company and this thread is right at the top of the Google search results for that company's name, it might be an attempt to get this content taken down.

In keeping with this blog's policy on legal threats, I'll be documenting the ongoing action at this page on the main blog:
http://www.mrmoneymustache.com/rl360-insurance/
 
End Edit---]

Hi guys - I think I may have f*cked up badly, and I want to know what your suggestion is to minimize the damage.

Basically about 12 months ago I signed up with one of these insurance-wrapper-offshore-investment-schemes. I had been previously sent overseas to Asia was and earning decent (not great mind you) money for the first time in my life. I didn't like having it sitting around in cash. I don't think it's a "scam" necessarily but I do think the fees may be excessive.

The details are:

Now, one year in I'm considering what my options are.

1) Cancel the entire thing. I'll lose a year's worth of deposits (imagine losing a year's worth of mustachian-level saving in one hit). Very expensive lesson.
2) Pay the second year's worth of payments, then turn it down to 300 bucks a month for the next 23 years.
3) ??

Also, I have been hearing mixed stories about fees that are hidden inside the funds. I've been assured that I'm only paying the AMC and nothing else but obviously I'd have no way of knowing what was going on behind the scenes.

And regarding fees to the adviser, my understanding is that they receive a few thousand dollars upfront for signing me up to the product, but then nothing ongoing. They have to try and upsell other products if they want me to remain profitable. But like the fees possibly hidden inside the fund I'm not so naive to discount the possibility of further kickbacks etc.

Would appreciate input from anyone who has had any real experience or inside information on these outfits. If after 25 years I can expect to be in not-too-bad shape then I'm happy to stick the (300 dollar) course but otherwise I'll probably have to take a very very expensive lesson.

Title: Re: I dun goofed
Post by: bacchi on March 27, 2014, 08:53:23 AM
Good god, man. That 2%+ for 23 years is going to kill your expected returns. 4% SWR on that investment? Try 2%, minimum.

It sucks but you gotta drop it.
Title: Re: I dun goofed
Post by: Frankies Girl on March 27, 2014, 09:17:59 AM
What have you paid in so far? Has it shown any real growth other than the money you're putting in?

If I'm reading all of the info correctly, you pay in a certain amount (?) for the first two years, then can drop to a $300/mo payment for a total of 25 years, and it's basically just an investment account with high fees, but you have no flexibility for the most part. I'm not sure what the advantages were supposed to be to locking you into a payment and for 25 years (there had to be some sort of incentive, right?) but it sounds ridiculous since you could open an investment account at any other place and put in or take out whatever or whenever you liked.

I just went to their website, and it's touting the product as better than a pension and as a flexible savings vehicle, but still say that forced contributions and locking someone into payment plans is anything but flexible and of course, there is the brutal expenses/charges. And just LOVE how they won't let you enroll through them directly but has to go through a financial adviser. That's not weird at all. ;) And it looks like surrender charges can be up to 71% of what you pay in... if I'm reading their literature correctly, but they keep saying "see your adviser" since they want a live person to talk you out of it of course.
 
No matter what the initial "investment" is, I'd most likely consider it sunk cost and cancel it and figure it is another expensive life lesson tho. Being locked into a very odd arrangement of forced payments and paying really high fees to boot sounds awful.

Title: Re: I dun goofed
Post by: MDM on March 27, 2014, 09:20:04 AM
Your post contains "I think..." and "I've been told..." phrases.  First suggestion would be to get everything in writing, then make sure you understand it.

With most (all?) insurance products, the best set of conditions occur at the start.  After that, the company may (depending on the contract language) be able to change those conditions in ways unfavorable to you.  E.g. higher annual fees, lower returns, etc.

If there is nothing legally preventing you (e.g., some do-not-disclose clause), you could redact identifying information and post a copy of your contract.  You might get no better than "OMG that's too complicated to understand" but it could be worth a try.

Kudos for being willing to cut your losses and not throw good money after bad.  But understanding the true situation before acting seems best.
Title: Re: I dun goofed
Post by: dungoofed on March 27, 2014, 04:01:55 PM
Hi - thanks for the replies so far. Whether you mean it or not it actually feels like you guys are willing to help me out here.

Ok so a couple of extra point to put things in perspective:


Geez, I feel dirty after putting together that list.

Bacchi - true it has to beat the market by a little more. The SWR used in the literature was 5%; returns over the course of the plan were assumed to be 8% after fees. Hard to just walk away as that's basically an entire year of savings for me. Also, the way the fees were sold to me was that the six month bonus at the beginning, best not to think of that as a bonus per se but rather money that will be used to pay the fees over the course of the plan.

Frankie's Girl - assume I put in half my post-tax salary. So if I was earning 100K after tax, there is 50K already in there, with 50K to come over the next 12 months. Then 300x23x12=about 80K of payments over the next 23 years.

Ok, so the fact that they outsource the sales side of thing to local experts is easy to understand. Royal London or any of these guys (Zurich, Royal Skandia, etc) don't want to deal with the day-to-day hassles of people like me having freak-outs about their investments : )

Also, I think you need to compare this plan with something like a 401K or RRSP or Superannuation regarding the term of the product. Yes, it sucks that I have to pay in regularly, but the term of the plan is actually just as inflexible as anything the government has come up with, potentially less-so.

Tax-free growth is the other benefit. Thing is, I was never in it for this - I declare (but don't incur tax obligation on) the entire amount each year.

Without sounding like I'm actually selling the product again, I don't mind the fact that the investment is not onshore in my home country nor the country in which I earn income. I think of it as diversification of an investment account across countries. Sovereign diversification.

MDM - apologies, I'm usually quite careful with my wording. From here:

http://www.rl360adviser.com/generic/downloads/qu005.pdf


For what it's worth, it returned a little under 8% last year, after all fees. It's only about 50% in developed markets though, early days yet.
Title: Re: I dun goofed
Post by: MDM on March 27, 2014, 04:46:30 PM
Ok, this might not be so bad - depending much on the details behind:
"Investment options
There is a wide choice of funds available covering a broad
range of asset classes, investment styles and geographical
sectors. The maximum number of funds that can be held is 10.
Please refer to the Investment Guide for further information."

Some thoughts that occurred as I read through the document.  No requirement for you to answer here, but you probably should know the answers yourself:
 -  Did you choose a life assurance policy or a capital redemption policy?  What does that mean for you after 25 years?
 -  Did you get a single policy or 100 sub-policies, and why?
 -  What funds are available to you?  Are these listed on a public exchange?  What are the fees for each fund?  Are you subject to participation rates, spreads, etc. (i.e., are these indexed annuities) or are these direct index funds? 
 -  How much, in absolute terms, are you paying for all these:
     Charges
     Initial unit charge: 0.50% per month (6% per year)
     Contract charge: 0.125% per month (1.50% per year)
     Policy fee: USD8.00 per month (or currency equivalent)
     Annual management charges

A result for 2013 of 8% is fine if you had bond funds, not so great if you had US stock funds. 

You could put together a spreadsheet calculating everything the way you think it should be calculated.  When you get statements (or check online), if those numbers match yours then you do understand it.
Title: Re: I dun goofed
Post by: dragoncar on March 27, 2014, 04:56:28 PM
Jesus...  so what happens if you miss one of those monthly payments?

Where is your citizenship and why can't you invest in normal vehicles?
Title: Re: I dun goofed
Post by: ZiziPB on March 28, 2014, 11:33:35 AM
It sounds to me like something similar to a variable annuity?  Is there any guaranteed rate of return? 

I would have a hard time walking away from a significant initial investment (I know the argument about sunk costs, etc., etc. but in this case the money is invested and you are getting something out of it in the end).  $300 per month doesn't sound like a lot of money going forward so maybe consider keeping the beast and making the best of it?
Title: Re: I dun goofed
Post by: dungoofed on April 11, 2014, 12:04:43 PM
Ok I finally realized why the "300 dollars per month" option is not feasible.

By the end of the two year initial allocation period I will have say $100,000 worth in the account. Everything I invest *after* that will be subject to approximately total 3% fees per year (plus 3% inflation of course). Not great but not bad.

But the clincher is that the initial $100,000 will be subject to about 7% over the term of the plan (ie 25 years). Combined with 3% inflation I'm going backwards, and after several decades my $100,000 will be all but whittled away entirely.

And that's not even the best part. The best part is that the initial two years is the "tough" part, so once that is over there is an incentive to keep putting in the max you can as the fee rate is preferential. And worst case you can pay the minimum of $300 a month for the privilege of watching the initial 100K whittled away

FML. If anyone has a story about walking away from something like this then please let me know. Seriously torn here. Don't know how to explain to my wife either.

Title: Re: I dun goofed
Post by: danclarkie on April 11, 2014, 12:44:17 PM
I was sold the EXACT same product.
I am in Dubai.

The salesman sold the same product to 4-5 of my friends and uses high pressure techniques to solicit referrals from you in order to sell the same products to all of your friends.

I wised up to this product about 7 months in and ended up walking away from $7,800 invested.
These are terribly shitty products, sky high fees and a a massive upfront commission for the "financial adviser"

I would advise you to take a look at this blog which highlights the issues of these ILAS schemes: http://therapeofhongkong.com/

Take a look at this caluclations sheet that I made for the Royal London 360 product: https://docs.google.com/spreadsheet/ccc?key=0AlZ4DevKDH_AdDdLQlozM1JKa3V4Wl9Yei11VkxLTUE&usp=drive_web#gid=0

Which country are you in now?
The sale of these products is heavily regulated in the developed markets such as UK/AUS.

I am in the UAE and I am now investing in ETFs via an online broker.
It is not as easy as someone living in the UK/US but it is totally possible.

I would say you need to consider the current investments into this ILAS piece of shit as a loss and don't fall prey to the illusion of the sunk cost fallacy. :(

When I told the financial salesman that I was planning to quite the product he quickly arranged a meeting with me and his boss.
I secretly recorded the meeting on my phone and have audio recording of him mis-representing the product.
Firstly he understated the annual charges, and secondly he understated the surrender charge that applies for early policy surrender.

Get out of this product today.
Tell all of your friends that are in the same product.

The Financial Advisor will then be forced to repay several thousands of dollars in commissions that he/she has earned from your acc.

All commissions are paid in full on day 1, so as soon as you sign the adviser gets several thousand dollars in commissions.

I would also encourage you to NAME AND SHAME your financial adviser and the firm he/she works for.
These people are notoriously litigious and online-reputation savy, If you google the name of your adviser you probably won't find anything at all.
I would not be surprised if he/she is using a false name.

Everything about these products is absolutely awful.
The seller gets a massive commission for selling them, and such arrangements are ILLEGAL in the UK.

Cancel your standing order asap.
Title: Re: I dun goofed
Post by: MDM on April 11, 2014, 01:11:04 PM
Quote from: dungoofed on April 11, 2014, 12:04:43 PM
By the end of the two year initial allocation period I will have say $100,000 worth in the account. Everything I invest *after* that will be subject to approximately total 3% fees per year (plus 3% inflation of course). Not great but not bad.

But the clincher is that the initial $100,000 will be subject to about 7% over the term of the plan (ie 25 years). Combined with 3% inflation I'm going backwards, and after several decades my $100,000 will be all but whittled away entirely.

Worst case interpretation of what is written:
  - The initial $100K is not invested at all.  It earns nothing, but Royal London (RL) withdraws 7%/year as a fee.  After 25 years, 0.93^25 * $100K = $24,444 is left (and worth $11,674 after 3%/yr inflation).
  - For everything after the first $100K, you get charged 3%/yr * "Assets Under Management" (vs. "The industry average (http://www.cnbc.com/id/100650452) is roughly 1 percent, but fees can range from 0.81 percent to 2.08 percent, according to Toronto-based PriceMetrix, which tracks investment industry fees in the U.S. and Canada."

Best case interpretation of what is written:
  - The initial $100K invested in some decent index funds, and earns whatever those funds earn.  Royal London (RL) withdraws 7%/25= 0.3%/year as a fee. 
  - For everything after the first $100K, you get charged 3%/yr * your invested amount, not counting earnings

Worst case borders on or crosses over to usury.  Best case isn't bad at all.  Not sure which, or where in between, it is...?
Title: Re: I dun goofed
Post by: dungoofed on April 11, 2014, 03:35:11 PM
Hi MDM - it's not quite worst case above but thanks for outlining it for me. It's basically the worst case scenario offset by the gains I expect to see from the funds. It's 7% a year on my original 100K for 25 years.

So I need to think whether it is better for the next 12 months' payments to be given the same treatment. I'm not an actuary and this is a little hard to think about but I think this is what it comes down to.

Dan - thanks for those links. Reading was very painful. I've really fucked up here.

I modified the spreadsheet to see what would happen if I reduced my payments to $300 a month after the 24th month, and it was as expected: the average fees were 5.15% over the course of the plan.

Best to just walk away from the 50K already invested?
Title: Re: I dun goofed
Post by: danclarkie on April 11, 2014, 04:29:20 PM
You know once you stop making payments and mark the policy as "paid up" the fees increase, right?

The $50k you have in there is already gone, it has been paid almost directly to the adviser that set you up with this package, so you might wish to bear that in mind when you next meet him.

The only way to get back that $50k now is to continue to pay into the account for the next 24 years and hope that the funds grow substantially above inflation every single year for the next 24 years.

From the spreadsheet, assuming you are paying in $4,166.67 a month the fund needs to grow at 5.33% a year every year.

After 24 months, your "adviser" has locked in his commission and has no incentive to continue to manage your funds for the next 23 years, so he will either spend the next 23 years trying to sell you more shite loaded up with fees, or will simply fuck off and leave you high and dry to manage your own funds for the remaining term (remember you need to grow a minimum of 5.33%/year).

If you look at the spreadsheet, check the "Surrender penalty" column, you can see the loss you will incur if you quit the policy.

Right now it is -$50,820.04.

If you continue to pay into the policy, and it grows at 5.33% every year, the potential loss you will incur by closing the account goes up and doesn't drop back below -$50,820.04 until month 229, more than 19 years into the policy.

and IF you are somehow able to pick funds that grow at 5.33% every year for the next 25 years, then doing so with ETF's via an online brokerage would come out $567,651.24 better off.

That is, assuming that your adviser is in the very small minority of advisers that can beat the market consistently over 25 years.
Even if he is, and he has some god given ability to pick funds and beat the market for the next 25 years, you will lose several hundred thousand dollars over the 25 years because of the rip-off fee structure of the Royal London Quantum 360 ILAS product.

These are terrible, terrible, products.
There are growing calls to ban the sale of such plans here in the UAE (http://www.international-adviser.com/news/middle-east/call-made-to-ban-25-year-savings-policies)
And plans have come under regulatory spot light in Hong Kong (http://www.scmp.com/business/banking-finance/article/1373535/controversial-investment-linked-assurance-schemes-poised)

Another thing is, this really fucks up any early retirement plan.

If you remain in this plan, you basically can't retire for the next 24 years because you need to contribute $5k a month into the plan for the next 24 years or else take a massive loss on the premiums currently paid.

Whilst still inside your Initial Allocation Period, the best date to cancel the policy is yesterday, closely followed by today.

The dumb thing is, even after I explained this to all of my friends that are in these plans, 2 of them said "Well I have invested too much into it to simply walk away from the plan"
Absolute sunk cost fallacy.

I'll leave you with the following thought.
Even if the policy grows at the promised 8% a year for the next 25 years.
If inflation continues at 3% your policy will break even in 11 years.

That is, you could cancel the policy and get back as much as you have deposited, adjusted for 3%/year inflation.
Your money would have been locked up for 11 years and invested in funds that carry significant risk, in order to produce 8% return.
And for all of that, you would get back what you have deposited, adjusted for inflation, and absolutely ZERO capital growth.
Meanwhile, Royal London have charged an average of 5% a year in fees, taken $90,162.71 in surrender charge, and your adviser has taken $51,450.04 in commission.

My advice would be to get out now and start sticking the $5k a month into something more suitable such as an index fund portfolio or into a rental property.
Title: Re: I dun goofed
Post by: marty998 on April 11, 2014, 05:14:20 PM
This product is ridiculous. Con men, fraudsters, grifters and other various charlatans wouldn't be as brazen as this

I don't want to be childish, but is was a lot of fun taking that other company to task over their bullshit product.

So can I be the first to say Royal London 360 sucks donkeys balls?
Title: Re: I dun goofed
Post by: Roland of Gilead on April 11, 2014, 05:22:31 PM
I never realized how good we had it here in the USA where we can buy a Vanguard total stock market index fund, have our funds direct deposited there monthly, and pay a total fee of 0.05%.
Title: Re: I dun goofed
Post by: dragoncar on April 11, 2014, 05:33:34 PM
Quote from: Roland of Gilead on April 11, 2014, 05:22:31 PM
I never realized how good we had it here in the USA where we can buy a Vanguard total stock market index fund, have our funds direct deposited there monthly, and pay a total fee of 0.05%.

I still don't really understand why the money was locked up.  All this to avoid a wire transfer fee?
Title: Re: I dun goofed
Post by: dungoofed on April 11, 2014, 05:42:58 PM
For the "switch it to 300 bucks a month" model in the spreadsheet, and lowering the Adviser Commission to what it should be it comes out at $131,000 deposits, for a nominal total after 25 years of $273,000 (money should be doubling every eight years as a rule of thumb, not every 25). And $160,000 in fees over the period.

Very expensive lesson for me in sunk costs but I'll surrender the plan today.

Dragoncar - please don't make me feel worse than I already do :-/

(just kidding - if others can learn from my mistakes then I'll feel like I've paid my karmic dues).

But yeah, the wire fee and other things as well. I listed all the good points earlier up.

Title: Re: I dun goofed
Post by: Argyle on April 11, 2014, 05:52:47 PM
As they say, "That's what we call 'tuition.'"
Title: Re: I dun goofed
Post by: dungoofed on April 11, 2014, 05:59:32 PM
Touche. Not to mention that the money would have gone a long way towards a formal education too.

Of course, the risk now is that I feel like I'm "behind" and so I need to do more risky investments in order to beat the market and catch up again. I need to take a couple of deep breaths and start looking at ways to get money into a Vanguard of sorts.

Title: Re: I dun goofed
Post by: beltim on April 11, 2014, 06:12:37 PM
Quote from: dungoofed on April 11, 2014, 05:42:58 PM
For the "switch it to 300 bucks a month" model in the spreadsheet, and lowering the Adviser Commission to what it should be it comes out at $131,000 deposits, for a nominal total after 25 years of $273,000 (money should be doubling every eight years as a rule of thumb, not every 25). And $160,000 in fees over the period.

Very expensive lesson for me in sunk costs but I'll surrender the plan today.

Dragoncar - please don't make me feel worse than I already do :-/

(just kidding - if others can learn from my mistakes then I'll feel like I've paid my karmic dues).

But yeah, the wire fee and other things as well. I listed all the good points earlier up.

Is this counting the $50,000 in deposits you've already made?  If so, you should take that out of the calculation -- that money is already gone, after all -- you need to decide what to do with the next $50,000.  With $50,000 invested, even after fees you might be better off with the second year.  You also may be much worse off - I wasn't able to figure out that answer with the spreadsheet above.
Title: Re: I dun goofed
Post by: ToughMother on April 11, 2014, 06:31:38 PM
Quote from: dungoofed on April 11, 2014, 05:59:32 PM
Touche. Not to mention that the money would have gone a long way towards a formal education too.

Of course, the risk now is that I feel like I'm "behind" and so I need to do more risky investments in order to beat the market and catch up again. I need to take a couple of deep breaths and start looking at ways to get money into a Vanguard of sorts.

I don't know if this helps, as you have the added feeling of betrayal.  But, there are all sorts of "behind."  I got meningitis, had epic medical treatments (& costs) and was out of FT work for about 10 years and living off of my savings.

The good news that neither one of us was in debt as a consequence of our "experiences" but relative to the folks on this forum, we are "behind." 

Just move on. 

Lower expenses, save money in your NEW accounts, and hang in there.  Our "early retirement" may not be as epic as many folks here, but we'll get there.

Hang in and try not to focus on the behind part.
Title: Re: I dun goofed
Post by: dungoofed on April 11, 2014, 09:40:31 PM
Beltim - I modified the formulas in the spreadsheet so that it was "full payments for 24 months then 300 bucks a month after that."

Unfortunately the thing is structured so that the best option is to pay the full amount every month for 25 years. That gives you mediocre returns (not terrible unless you're being gouged with 4.5% Adviser Fee like Dan above but not great). But the reality is, I can't bear to put good money after bad when I know that there are superior products out there.

I just did the numbers and assuming the same return I confirm there is NO amount for which I continue paying into this thing is a better deal than throwing away the 50K and starting again at the same pace with a Vanguard.

ToughMother - thanks, yeah, it's odd because even when you have the figures in front of you in a spreadsheet confirming what you feared, it's quite hard to pull the trigger and take the loss. I've had setbacks before and I know that at the time they just seem insurmountable but with the right attitude you pull through. Thanks again for giving it a little perspective.
Title: Re: I dun goofed
Post by: danclarkie on April 11, 2014, 11:24:43 PM
Quote from: dungoofed on April 11, 2014, 09:40:31 PM
Unfortunately the thing is structured so that the best option is to pay the full amount every month for 25 years. That gives you mediocre returns (not terrible unless you're being gouged with 4.5% Adviser Fee like Dan above but not great). But the reality is, I can't bear to put good money after bad when I know that there are superior products out there.

I should just say that my policy had no specific Adviser fees.
4.2% commission is the standard ballpark figure for commission paid on the sale of these products.
Royal London has the highest fees of all the ILAS products.

I would be fairly sure that your "financial adviser" received a similar percentage.
The commissions are so high, and front loaded, to give the seller a massive incentive to sell them.
Without that huge commission, nobody in their right mind would ever suggest these products.
edit:typo.
Title: Re: I dun goofed
Post by: Zoot Allures on April 11, 2014, 11:45:44 PM
Quote from: ToughMother on April 11, 2014, 06:31:38 PM
Lower expenses, save money in your NEW accounts, and hang in there.  Our "early retirement" may not be as epic as many folks here, but we'll get there.

Hang in and try not to focus on the behind part.

Exactly right. We're all behind compared to someone else, but we're also far ahead of so many people just by virtue of the advantages we do have.
Title: Re: I dun goofed
Post by: Argyle on April 12, 2014, 12:21:40 AM
Also, what guarantees that the company won't fold sometime in the next thirty years?  In which case $50,000 is a small price to pay not to lose thirty years' worth of investments.
Title: Re: I dun goofed
Post by: danclarkie on April 12, 2014, 02:25:17 AM
Quote from: marty998 on April 11, 2014, 05:14:20 PM
So can I be the first to say Royal London 360 sucks donkeys balls?

This is why they seek to distance themselves by making you go via a local adviser.

The company I was sucked in by are called "Prestige Wealth Solutions (http://www.pissedconsumer.com/company/prestige-wealth-solutions.html)"
I should have known form the get go, with such a bullshit name.

They set up a shitty website: pws-intl.com, are seemingly unlicensed anywhere, and then just go out and sell as many products as possible, as quickly as possible.


The "Private Client Adviser" I dealt with was a guy named:
Something.

If you Google his name, it returns nothing which leads me to believe this may possibly be a false name.
If you Google the company name, a lot of the negative reviews are pushed down the search results by some blogspot blogs that I assume the company has set up for this express purpose.

With extended research you can find a list of people complaining about being scammed by this company.

I am so glad that I cut my losses at $7,800.
The $7,800 was a hard lesson but it made me wake up and take my financial planning into my own hands with plans I understand and have full control over.

Depending on the legal system in your country of residence, there may be the option to pursue legal action against your adviser for a refund of your deposit, but I highly doubt you would get anything from it.
Title: Re: I dun goofed
Post by: dragoncar on April 12, 2014, 01:10:15 PM
Sorry, not trying to make you feel bad.  I was just curious what kind of predicament you will still be in even after ditching this particular mistake.
Title: Re: I dun goofed
Post by: danclarkie on April 13, 2014, 09:09:16 AM
Quote from: Argyle on April 13, 2014, 02:15:46 AM
Some guy does come up as living in Kingston-upon-Thames in the UK, and another one (or the same one) in the Emirates, connected to the DeVere financial consultancy group.  For what it's worth.  Not saying that the whole thing isn't just as disadavantageous as you suggest, of course.

The only single page linking this guy to the Emirates is that DeVere Group page.
DeVere are a similar company that sell ILAS products to expats.
I would not be surprised if OP was dealing with DeVere Group as they tout themselves as the worlds largest financial advice company.

I still contend that it may be a false name, albeit one that he has maintained through both companies as they run on the same Modus Operandi.

It's 2014, if you don't show up in Google when your (rather obscure) name is searched then I am inclined to believe that is something that has taken planning and forethought in attempts to avoid being found.
A single profile on a single social network under your real name would show up.
A single comment you made on a blog or a forum under your name would show up.
Even if you chose not to do so, a friend mentioning your name somewhere would show up.
We are talking about a guy, in his mid twenties, that is a total ghost across all of those possible data points...
Title: Re: I dun goofed
Post by: dungoofed on April 16, 2014, 04:00:14 AM
Hi guys - thanks to everyone who posted.

After a sleepless night on Saturday and painful analysis of the figures I decided to make the excruciatingly painful decision to 1) stop payments (done), 2) cancel the credit card from which payments were made (requested), and 3) close the plan (arranged for next week).

Total loss: about $50K (a third of my net worth), plus the year of my life.

So now I'm trying to get back on track. Setting up a brokerage account in Singapore, wire transfer account, and Vanguard back in Australia.
Title: Re: I dun goofed
Post by: NinetyFour on April 16, 2014, 04:25:35 AM
Sorry about your loss.  I hope that, on balance, you feel good about your decision to get out of that bad scheme and move on.  Sounds to me like you did the right thing.
Title: Re: I dun goofed
Post by: dungoofed on April 16, 2014, 08:13:58 AM
For what it's worth, I don't believe the plan is a scam per se (Stockholm Syndrome anyone? lol) but there are plenty of scammy things about it. See the comprehensive list of benefits earlier in the thread. I mean, fire-and-forget automated monthly payments from your credit card is almost worth the price of admission alone.

The things I don't like about it are:

1) the fact that if you do anything that deviates from the course you are worse off. So while there are supposedly all these options over the years (plan holidays, reducing payments, etc), the reality is that there is this looming pressure to stick the course, to keep up the payments. So it is very similar to a loan in that regard (incidentally this is sold as a feature to "save the investor from himself").

2) The fees. No-one is expected to work for free but the fees on the plan mean that instead of your money doubling three times in 25 years it only doubles 1.5 times. Also I understand that this is not a brokerage account but still, that's a big difference for the SAME AMOUNT OF RISK as someone in Vanguard (incidentally this is the calculation that made me realise that I would be better off walking).

3) The mutual funds. The plan invests in "creme de la creme" mutual funds that are supposedly able to beat the market over time. Now, we won't know until 25 years later whether this turns out to be the case, but at least with index funds we are already up 1-2% before we even start, and there is much more transparency with an index-tracking fund.

4) The product needs salespeople to sell it. Compare that with Vanguard, which has enough fans that they never have to spend any money on sales. Even if not even 100% of these savings are passed on to the investor, you're still worse off with the product before you've even begun.

Anyway, thanks for listening. If anyone has a suggestion where someone mid-30s with no major assets to his name should start putting his money please guide me.
Title: Re: I dun goofed
Post by: danclarkie on April 16, 2014, 09:20:08 AM
Quote from: dungoofed on April 16, 2014, 08:13:58 AM
For what it's worth, I don't believe the plan is a scam per se (Stockholm Syndrome anyone? lol) but there are plenty of scammy things about it. See the comprehensive list of benefits earlier in the thread. I mean, fire-and-forget automated monthly payments from your credit card is almost worth the price of admission alone.

The things I don't like about it are:

1) the fact that if you do anything that deviates from the course you are worse off. So while there are supposedly all these options over the years (plan holidays, reducing payments, etc), the reality is that there is this looming pressure to stick the course, to keep up the payments. So it is very similar to a loan in that regard (incidentally this is sold as a feature to "save the investor from himself").

2) The fees. No-one is expected to work for free but the fees on the plan mean that instead of your money doubling three times in 25 years it only doubles 1.5 times. Also I understand that this is not a brokerage account but still, that's a big difference for the SAME AMOUNT OF RISK as someone in Vanguard (incidentally this is the calculation that made me realise that I would be better off walking).

3) The mutual funds. The plan invests in "creme de la creme" mutual funds that are supposedly able to beat the market over time. Now, we won't know until 25 years later whether this turns out to be the case, but at least with index funds we are already up 1-2% before we even start, and there is much more transparency with an index-tracking fund.

4) The product needs salespeople to sell it. Compare that with Vanguard, which has enough fans that they never have to spend any money on sales. Even if not even 100% of these savings are passed on to the investor, you're still worse off with the product before you've even begun.

Anyway, thanks for listening. If anyone has a suggestion where someone mid-30s with no major assets to his name should start putting his money please guide me.

I think the products are wholly unsuitable for 99.9%of people, for a few reasons.


Quote from: dungoofed on April 16, 2014, 08:13:58 AM
I mean, fire-and-forget automated monthly payments from your credit card is almost worth the price of admission alone.

To be blunt, this is bollocks, mate.
Set up a Bank Standing Order to wherever you decide to invest next.
That is even easier as you don't have to remember to pay off your credit card.

Quote from: dungoofed on April 16, 2014, 08:13:58 AM
Anyway, thanks for listening. If anyone has a suggestion where someone mid-30s with no major assets to his name should start putting his money please guide me.

I can't tell YOU what YOU should do as I am not a financial adviser by any stretch of the imagination.
I will tell you what I did and what I am doing :)

I opened an account with SaxoBank http://www.saxobank.com/
Transferred in the money I had and began buying ETFs from their web trader platform.
Read this article over on Bogelheads: http://www.bogleheads.org/forum/viewtopic.php?f=1&t=134661

I outlined my situation in this thread: https://forum.mrmoneymustache.com/welcome-to-the-forum/hello-from-dubai-)/

But here it is ;)

I have 3 offshore bank accounts in the Isle of Man and Jersey, in USD, EUR, and GBP.
Currently I have around $5k in the USD acc and a combined $500 in EUR/GBP.
The USD acc is a real Emergency Fund in case that my local bank account gets frozen for whatever reason (it happens)

In the coming month I will move $10k from my local acc into my investment acc and reduce the EF to $10k across Local and Off-Shore Banks.

My Investment acc has been opened to set up a portfolio of Index Fund ETFs as there are no viable alternatives to get access to low TER index funds.

Being in the UAE, dividends from US based Funds/Stocks are taxed at 30% withholding tax (sucks) so a better option is to go with Funds domiciled in Ireland, such as BlackRock iShares and Vanguard UK to avoid the dividend tax.
CGT is 0%.

My current portfolio is:

65.59% VWRD  (https://www.google.com/finance?cid=650012194937865)VANGUARD FUNDS PLC VANGUARD FTSE ALL-WORLD$48,883.50
20.21% LQDE  (https://www.google.com/finance?q=LON%3ALQDE&ei=xHs-U5H9GoGVwQPhtwE)ISHARES PLC ISHARES $ CORPORATE BOND$15,061.95
9.82% VBK  (https://www.google.com/finance?q=VBK&ei=2ns-U-j3LsuBwAPgVg)Vanguard Small-Cap Growth ETF$7,315.80
4.39% GOOGL  (https://www.google.com/finance?q=NASDAQ%3AGOOGL&ei=6Hs-U5jODeKHwAORUw)Google Class A Shares$3,271.50

The main portfolio is basically a 2 fund lazy portfolio with 80/20 split Stocks/Bonds.
I gave myself ~$3,500 for individual stocks to allow myself some creativity to buy and hold individual stocks and allow the remaining 95% to remain long term buy and hold.
This allows me to feel some sense of control, whilst leaving the vast majority of my portfolio in index funds.

So there you have it.
I don't know what YOU should do, and I don't want to run the risk of giving you bad advice, but you can probably take something from my set up and work out a plan that best fits you. :)

Dan
Title: Re: I dun goofed
Post by: dungoofed on April 17, 2014, 07:48:40 PM
Thanks Dan - appreciate you sharing and I know that our situations will be different but appreciate it all the same.

Title: Re: I dun goofed
Post by: Ohio Teacher on April 18, 2014, 06:25:46 AM
Sorry about your loss.  Use this as a springboard to be super-extreme in your saving over the next few years and you will forget all about it.  I made some monetary mistakes early on that have actually turned into net positive decisions due to the changed behaviors they imparted on me for the future. 
Title: Re: I dun goofed
Post by: Chuck on April 18, 2014, 03:45:24 PM
Drop it. Yesterday.
Title: Re: I dun goofed
Post by: lightlike on April 18, 2014, 08:28:03 PM
I'm a UK expat currently in Japan, and was sold the exact same product.  I showed him Dan's sheet, and he came back with the following points.  I'm wondering about the validity of the below features he lists as arguments to keep the plan, specifically in relation to my return to the UK one day.

- 5% allowance - He pointed me to this provision on HMRC site: http://www.legislation.gov.uk/ukpga/2005/5/section/507.  But the following seems to present it as related to investment bonds?  http://www.which.co.uk/money/savings-and-investments/guides/investment-bonds/withdrawals-and-charges/
- Top slicing - Again, bond related, but also applicable to these insurance wrappers?
- Time apportionment relief - http://www.scottishwidows.co.uk/Extranet/Literature/Doc/FP0008
- Estate planning - Key point being the easy transfer of fund to my wife in the event of my untimely demise

If I dump this and go with a brokerage account, how do I get equivalent tax efficiencies?  Is it impossible, and I simply shouldn't worry about it because my net will still be larger than this product? 
What about the estate planning aspect?  Assume a joint account, or TOD would make this point void?

Thoughts appreciated.  Thanks.
Title: Re: I dun goofed
Post by: MDM on April 18, 2014, 08:58:51 PM
lightlike, when you say "I showed him Dan's sheet":
  - Is "him" the agent who sold you the product, and
  - Is "Dan's sheet" the spreadsheet danclarkie referenced here: "Take a look at this caluclations sheet that I made for the Royal London 360 product: https://docs.google.com/spreadsheet/ccc?key=0AlZ4DevKDH_AdDdLQlozM1JKa3V4Wl9Yei11VkxLTUE&usp=drive_web#gid=0"?

If so, what numbers in the spreadsheet did the agent dispute?
Title: Re: I dun goofed
Post by: lightlike on April 18, 2014, 09:14:49 PM
MDM - correct, and correct.

He made no real dispute about the numbers in the sheet per se - just raised these 4 tax efficiency points as the USP of the product - and worth keeping it for these alone.  Hence I'm wondering about the validity of those points.
Title: Re: I dun goofed
Post by: MDM on April 18, 2014, 09:59:48 PM
Quote
If I dump this and go with a brokerage account, how do I get equivalent tax efficiencies?
No idea - you'd have to explain what the links say in practice, as they were not "intuitively obvious" (at least not to me).  Better yet would be to translate the verbiage into Excel calculations.  Reducing the words to numbers removes any ambiguity.  If you can do that yourself, great - otherwise ask the agent to go through and do it with you.

Quote
Is it impossible, and I simply shouldn't worry about it because my net will still be larger than this product?
That's the question, isn't it?  Only way I know to evaluate it is to use some reasonable expectations on returns and run the numbers, as above.

Quote
What about the estate planning aspect?  Assume a joint account, or TOD would make this point void?
A good question to ask.  Don't know that answer for these products.  Do know that annuities sold in the US have the advantage of avoiding taxes on interest paid (but not withdrawn) while the original holder is alive - but the disadvantage that the basis does not "step up" for inheritors.
Title: Re: I dun goofed
Post by: dragoncar on April 19, 2014, 12:22:14 AM
Quote from: MDM on April 18, 2014, 09:59:48 PM
Quote
If I dump this and go with a brokerage account, how do I get equivalent tax efficiencies?
No idea - you'd have to explain what the links say in practice, as they were not "intuitively obvious" (at least not to me).  Better yet would be to translate the verbiage into Excel calculations.  Reducing the words to numbers removes any ambiguity.  If you can do that yourself, great - otherwise ask the agent to go through and do it with you.

Quote
Is it impossible, and I simply shouldn't worry about it because my net will still be larger than this product?
That's the question, isn't it?  Only way I know to evaluate it is to use some reasonable expectations on returns and run the numbers, as above.

Quote
What about the estate planning aspect?  Assume a joint account, or TOD would make this point void?
A good question to ask.  Don't know that answer for these products.  Do know that annuities sold in the US have the advantage of avoiding taxes on interest paid (but not withdrawn) while the original holder is alive - but the disadvantage that the basis does not "step up" for inheritors.

Yeah please explain that jargon to is as it means nothing to me.  If you cAnt explain it then you don't understand it and thus shouldn't be investing in it.
Title: Re: I dun goofed
Post by: danclarkie on April 20, 2014, 08:33:11 AM
Quote from: lightlike on April 18, 2014, 08:28:03 PM
I'm a UK expat currently in Japan, and was sold the exact same product.  I showed him Dan's sheet, and he came back with the following points.  I'm wondering about the validity of the below features he lists as arguments to keep the plan, specifically in relation to my return to the UK one day.

- 5% allowance - He pointed me to this provision on HMRC site: http://www.legislation.gov.uk/ukpga/2005/5/section/507.  But the following seems to present it as related to investment bonds?  http://www.which.co.uk/money/savings-and-investments/guides/investment-bonds/withdrawals-and-charges/

I have literally never heard about this, I have a feeling they are trying to bamboozle you with legalese to try and keep you onboard, in a sense of "Oh look how complicated this all is, thank God I have this nice man to take care of it all for me and that he is working in my best interest"

If he can't explain it in a way you understand it, then he doesn't understand it himself.

Quote from: lightlike on April 18, 2014, 08:28:03 PM
- Top slicing - Again, bond related, but also applicable to these insurance wrappers?

Was never explained to me, but I found this article:
http://www.telegraph.co.uk/finance/personalfinance/2839800/How-top-slicing-works.html

Seems to be similar to Time apportionment relief in that it takes the total gained at encashement and spreads it over the policy lifetime then taxes you on a part of this.
I find this to be utter bollocks.
Will explain in the next part:

Quote from: lightlike on April 18, 2014, 08:28:03 PM
- Time apportionment relief - http://www.scottishwidows.co.uk/Extranet/Literature/Doc/FP0008

This part was explained to me.
But it's a load of bullshit tbh.

The idea is that if/when yo return to the UK, when you encash the policy you will not be taxed for the time you were out of the country.
For example on a 25 year plan, if you opened it abroad and then moved back to the UK with 15 years left of the policy, you will pay tax on 15/25th of the capital gains, and NOT on 10/25ths.

The reason this is shit is:
Nobody in their right mind would open this policy in the UK.
If I were to head back to the UK I would look to close up all of my investments offshore and cash out, then take that money and invest it in something tax efficient in the UK.

But you cant cash out of this policy if you want to head to the UK, because you are locked in.
So you will be locked into a policy (as an example 15 more years) which has high fees, is inflexible, and is tax inefficient.

These products are sold as being tax efficient because of your status as an expat.
When that changes, the tax efficient benefits of these polices are no longer in place and they are simply really shitty policies that you are locked into.

Quote from: lightlike on April 18, 2014, 08:28:03 PM
- Estate planning - Key point being the easy transfer of fund to my wife in the event of my untimely demise

At the risk of sounding dumb.
Does a Solicitor notorised Will and Testament not do exactly this?

The thing is that these ILAS schemes are actually Life Assurance plans with an investment arm bolted on.

What you actually buy, its a Life Assurance Policy which has a payout of 1% upon death.
That is not a typo.
Value of the fund + 1%

That is to say, if you have paid in for 20 years and you policy has a value of $500k and then you meet an untimely death, your spouse can expect a payout of $505k

You have put in $500k for $5k of life assurance.
The effective fee for these plans is around 3%/year.
This means the fee's are much, much, higher than any potential pay out your spouse would benefit from.

If your wife is a joint owner of the policy, ownership transfers to her and she gets no payout, rather she is shafted with the premium payments until the end of the policy.

source: http://www.rl360.com/generic/downloads/qu004.pdf

Quote from: lightlike on April 18, 2014, 08:28:03 PM
If I dump this and go with a brokerage account, how do I get equivalent tax efficiencies?  Is it impossible, and I simply shouldn't worry about it because my net will still be larger than this product? 
What about the estate planning aspect?  Assume a joint account, or TOD would make this point void?

Thoughts appreciated.  Thanks.

Step 1: Understand the tax benefits of this product FULLY.
Step 2: understand the tax obligations of a brokerage acc.

Japan seems to have a CGT of 20% http://en.wikipedia.org/wiki/Capital_gains_tax#Japan
If you are investing in US stocks, then dividends will be taxed at 30% unless a treaty exists with Japan to reduce that.
For this reason I invest in EUdomiciled ETFs that pay the witholding tax on US dividends at 15% and 0% tax on non US dividends.

The CGT will only apply when you cash out a stock and make capital gains.

If you are in this for 20+ years, then the CGT you pay will depend on where you live when you cash out the portfolio (if ever).
Unless you intend to cash out your portfolio in full each year and re-balance.

I am totally NOT a tax expert.
I live in a country with 0% income tax and 0% CGT.

However, I know a place where you can get SOLID tax advice on ETFs/Portfolios.
http://www.bogleheads.org/forum/viewtopic.php?f=1&t=134661

Open an acc there and run your questions past the smart people on that forum.
I recall there was a Norwegian guy who was giving advice about taxation issues as Norway has a very high rate of CGT.

You will also want to read this, thoroughly: http://www.bogleheads.org/wiki/Investing_in_Japan

Let me know how you get on, I would be keen to see what you find out and what options are available in Japan, purely for my own interests :)
Title: Re: I dun goofed
Post by: lightlike on April 23, 2014, 11:35:02 PM
MDM - I specifically asked the agent to translate the verbiage into Excel calculations.  He replied...

"Going deeper into the tax discussion and trying to "find the magic in the numbers" would require bringing up the whole topic of transitioning from Asset Accumulation stage (next few decades) to Asset Protection stage (what actually happens at and after retirement, and how that retirement income is actually generated from the "pension pot", typically by rolling it over into a portfolio bond  {as unless you plan to accumulate a pension pot of about twice what we discussed, the retirement income will come predominantly from income-generating investments rather than keeping the pension pot in a current account and making withdrawals from the principal}, which, as discussed is not ideal if you want to take out the whole amount all at once, but suitable if used for the purpose of retirement income). And as mentioned in my previous email and in person, any sort of tax consideration should not be at the end of the day the primary reason for setting up a private pension"

Since I was cited tax efficiencies as one of the major reasons to sign up for this P.O.S. in the first place... that seems a bit of a weird thing to say?

dragoncar - I can't explain them so - fair enough, point well made.

danclarkie - Thanks for all the info, especially the boglehead link to investing in Japan.  There is a forum post linked from that page, specifically about ILAS in Japan which was a decent read.

Time to pull the trigger methinks...
Title: Re: I dun goofed
Post by: MDM on April 23, 2014, 11:46:50 PM
I think I agree with what you think.

But doesn't the agent hand wave and tap dance well?
Title: Re: I dun goofed
Post by: danclarkie on April 24, 2014, 01:59:59 AM
Quote from: lightlike on April 23, 2014, 11:35:02 PM
"Going deeper into the tax discussion and trying to "find the magic in the numbers" would require bringing up the whole topic of transitioning from Asset Accumulation stage (next few decades) to Asset Protection stage (what actually happens at and after retirement, and how that retirement income is actually generated from the "pension pot", typically by rolling it over into a portfolio bond  {as unless you plan to accumulate a pension pot of about twice what we discussed, the retirement income will come predominantly from income-generating investments rather than keeping the pension pot in a current account and making withdrawals from the principal}, which, as discussed is not ideal if you want to take out the whole amount all at once, but suitable if used for the purpose of retirement income). And as mentioned in my previous email and in person, any sort of tax consideration should not be at the end of the day the primary reason for setting up a private pension"

Versus his previous tune of:

Quote from: lightlike on April 18, 2014, 09:14:49 PM
He made no real dispute about the numbers in the sheet per se - just raised these 4 tax efficiency points as the USP of the product - and worth keeping it for these alone.  Hence I'm wondering about the validity of those points.

Brilliant...

You don't have to be Ben Bernanke to see that these policies are a joke.
Title: Re: I dun goofed
Post by: arebelspy on September 03, 2014, 01:29:53 PM
So apparently MMM got a bogus legal threat from Shabbar Mughal regarding this thread.

Unfortunately danclarkie decided to scrub his posts with useful information about the guy, and this thread no loonger shows up under a Google search for his name.

Too bad, as someone looking for information on the guy (researching if they should take his financial advice) would surely benefit from this.

So hopefully it will, with the name Shabbar Mughal re-added, show back up with a search for him.

Just know, if you're looking to invest with Shabbar Mughal, he's the type of person to use bogus legal threats to hide information about himself, and ask yourself: is that the person you want to invest with?

I can't comment as to the specificity of the other comments about him, but that speaks volumes, to me.

EDIT: Please Note: No one in this thread (above) is making any claims about any specific person, just offering information about various investments.  There are no people named in the thread above this post.

However, I am stating that Shabbar Mughal sent legal threats to MMM about this thread.

That should tell you enough about him, but if not, please read more information about the types of products he may or may not sell, above, to educate yourself before investing with someone who may sell these type of products.

EDIT 2: Thread is already appearing back on Google.  Ugly WAP view, but at least it's out there.
Title: Re: I dun goofed
Post by: eyePod on September 03, 2014, 02:02:40 PM
Quote from: arebelspy on September 03, 2014, 01:29:53 PM
So apparently MMM got a bogus legal threat from Shabbar Mughal regarding this thread.

Unfortunately danclarkie decided to scrub his posts with useful information about the guy, and this thread no loonger shows up under a Google search for his name.

Too bad, as someone looking for information on the guy (researching if they should take his financial advice) would surely benefit from this.

So hopefully it will, with the name Shabbar Mughal re-added, show back up with a search for him.

Just know, if you're looking to invest with Shabbar Mughal, he's the type of person to use bogus legal threats to hide information about himself, and ask yourself: is that the person you want to invest with?

I can't comment as to the specificity of the other comments about him, but that speaks volumes, to me.

EDIT: Please Note: No one in this thread (above) is making any claims about any specific person, just offering information about various investments.  There are no people named in the thread above this post.

However, I am stating that Shabbar Mughal sent legal threats to MMM about this thread.

That should tell you enough about him, but if not, please read more information about the types of products he may or may not sell, above, to educate yourself before investing with someone who may sell these type of products.

This thread is unbelievable. I could have sworn it was from a movie. The fact that 2 people got bamboozled and danclarkie was able to come in and show his exact experience with this same crap is just awesome. I'm glad the guys got out when they did. And I appreciate arebelspy giving this thread the bump. I remember MMM talking about this post and I'm glad I can see the whole experience laid out. Good lesson for everyone, especially painful for the three investors throughout the thread.
Title: Re: I dun goofed
Post by: dungoofed on September 04, 2014, 02:28:02 PM
Quote from: eyePod on September 03, 2014, 02:02:40 PM
I remember MMM talking about this post

OP here. Do you have a link to where he was talking about it? Or are you talking about IRL?

Title: Re: I dun goofed
Post by: arebelspy on September 04, 2014, 02:31:53 PM
Quote from: dungoofed on September 04, 2014, 02:28:02 PM
Quote from: eyePod on September 03, 2014, 02:02:40 PM
I remember MMM talking about this post

OP here. Do you have a link to where he was talking about it? Or are you talking about IRL?

eyePod is thinking about different legal threats MMM got, not this one.  This one happened much later than the other ones, and as such he already has a legal team in place if threats ever manifested (they won't).

Here is the forum policy on takedown requests and legal threats: http://forum.mrmoneymustache.com/forum-information-faqs/this-forum's-policy-on-takedown-requests-and-legal-threats/

I suspect eyePod is thinking of when MMM spoke about the legal threats that prompted that thread, last Spring.
Title: Re: I dun goofed
Post by: dungoofed on September 04, 2014, 06:02:09 PM
Cool, thanks.

In other news, Name and Shame coming soon - watch this space.

Also might do a "Where are they now?" special once this phoenix has risen from the ashes and is in slightly better financial shape.

Title: Re: I dun goofed
Post by: JonathanD on September 16, 2014, 01:13:41 AM
Hi everyone,
I'm a UK expat looking to start a pension plan. My situation is that I'm a teacher and I usually transfer my savings to my HSBC account in the UK.
I went back to the UK this summer (for a holiday before returning to teach abroad) and thought 'Right, I need to start a pension'. HSBC informed me that they 'no longer offer pension products' and when I contacted the Pensions Advisory Service they couldn't help as I've been out of the UK for more than 4 years and said I needed to contact someone with experience dealing with non-resident UK expats.
I contacted a financial adviser and they suggested the RL 360 Quantum - I found this thread/forum through searching 'RL360 Quantum' in Google. Judging by the comments, it doesn't sound like a good product which leaves me really confused.
My HSBC 'super saver' account pays 0.0001% interest - is there like a normal savings account I can open in the Isle of Man or somewhere without the fees or what could people recommend. Thanks
Title: Re: I dun goofed
Post by: eyePod on September 16, 2014, 09:19:13 AM
Quote from: arebelspy on September 04, 2014, 02:31:53 PM
Quote from: dungoofed on September 04, 2014, 02:28:02 PM
Quote from: eyePod on September 03, 2014, 02:02:40 PM
I remember MMM talking about this post

OP here. Do you have a link to where he was talking about it? Or are you talking about IRL?

eyePod is thinking about different legal threats MMM got, not this one.  This one happened much later than the other ones, and as such he already has a legal team in place if threats ever manifested (they won't).

Here is the forum policy on takedown requests and legal threats: http://forum.mrmoneymustache.com/forum-information-faqs/this-forum's-policy-on-takedown-requests-and-legal-threats/

I suspect eyePod is thinking of when MMM spoke about the legal threats that prompted that thread, last Spring.

You are correct. I assumed they were one in the same. I guess people see the traffic that he gets and just start flying circles over him.
Title: Re: I dun goofed
Post by: Ybserp on September 16, 2014, 01:07:39 PM
One post asked about estate planning in the context of a scam/poor investment option marketing itself as easily transferring the account to a spouse. This is a sales person playing on fear.

In the US, financial products of any kind are very easily set up to transfer to whoever you want to them to transfer to when you pass. All you have to do is fill out a beneficiary form with that bank or investment provider. (If you have a whole lot of money your estate may pay estate taxes, but this would be true if you had used the scammer service also.)

I encourage non-US readers to check with their banks and investment services companies to see if they too have the option of simply naming their beneficiaries. I suspect they will find that they do.
Title: Re: I dun goofed
Post by: dungoofed on September 16, 2014, 04:21:02 PM
Jonathan - after how long do you become a resident again?

What is wrong with using ISA and/or just a regular taxable trading account until you are eligible again?

Title: Re: I dun goofed
Post by: JonathanD on September 17, 2014, 12:43:48 AM
Quote from: dungoofed on September 16, 2014, 04:21:02 PM
Jonathan - after how long do you become a resident again?

What is wrong with using ISA and/or just a regular taxable trading account until you are eligible again?
hi, I just found this forum after Googling the RL360 Quantum - it made for interesting reading - you wrote that you surrendered the policy, right?
I left the UK to work abroad so am non-resident - I would have to move back to live there to be resident again. I contacted an IFA and he suggested this RL360 Quantum - after reading this thread it doesn't seem as though people have had good experiences with it. The IFA's suggestion seem to be about receiving commission so would you suggest a taxable trading account?
I re-read this thread and dan wrote about saxobank- I'll look into that. I just want somewhere to save money, the RL360 looks quite restrictive with high fees and other board members have noted already.
Title: Re: I dun goofed
Post by: dungoofed on September 17, 2014, 04:24:27 AM
LOL this thread appears just underneath the Quantum RL360 (http://forum.mrmoneymustache.com/investor-alley/i-dun-goofed) homepage in Google. Thousands upon thousands of people have clicked. I wish this thread was available as a warning before I got involved, but if this thread saves some other suckers then that's the best I can hope for.

Jonathan I surrendered the policy and lost the entire balance (about 50 grand). Given these costs were sunk, that was the best option available to me at the time.
Title: Re: I dun goofed
Post by: Barry Barrington on October 21, 2014, 09:22:24 AM
I saw this and thought you might want to see this link as to the workings of PWS, it will show you who and how this company works.

www.pws-dubai.blogspot.com (http://www.pws-dubai.blogspot.com)

It's a very very good read.

Quote from: danclarkie on April 12, 2014, 02:25:17 AM
Quote from: marty998 on April 11, 2014, 05:14:20 PM
So can I be the first to say Royal London 360 sucks donkeys balls?

This is why they seek to distance themselves by making you go via a local adviser.

The company I was sucked in by are called "Prestige Wealth Solutions (http://www.pissedconsumer.com/company/prestige-wealth-solutions.html)"
I should have known form the get go, with such a bullshit name.

They set up a shitty website: pws-intl.com, are seemingly unlicensed anywhere, and then just go out and sell as many products as possible, as quickly as possible.


The "Private Client Adviser" I dealt with was a guy named:
Something.

If you Google his name, it returns nothing which leads me to believe this may possibly be a false name.
If you Google the company name, a lot of the negative reviews are pushed down the search results by some blogspot blogs that I assume the company has set up for this express purpose.

With extended research you can find a list of people complaining about being scammed by this company.

I am so glad that I cut my losses at $7,800.
The $7,800 was a hard lesson but it made me wake up and take my financial planning into my own hands with plans I understand and have full control over.

Depending on the legal system in your country of residence, there may be the option to pursue legal action against your adviser for a refund of your deposit, but I highly doubt you would get anything from it.
Title: Re: I dun goofed
Post by: Barry Barrington on October 21, 2014, 01:44:01 PM
LOL You should read this link then www.pws-dubai.blogspot.com (http://www.pws-dubai.blogspot.com) as old Shabbar Mughal is listed there with some of the other guys that work at Prestige Wealth Solutions.

Quote from: arebelspy on September 03, 2014, 01:29:53 PM
So apparently MMM got a bogus legal threat from Shabbar Mughal regarding this thread.

Unfortunately danclarkie decided to scrub his posts with useful information about the guy, and this thread no loonger shows up under a Google search for his name.

Too bad, as someone looking for information on the guy (researching if they should take his financial advice) would surely benefit from this.

So hopefully it will, with the name Shabbar Mughal re-added, show back up with a search for him.

Just know, if you're looking to invest with Shabbar Mughal, he's the type of person to use bogus legal threats to hide information about himself, and ask yourself: is that the person you want to invest with?

I can't comment as to the specificity of the other comments about him, but that speaks volumes, to me.

EDIT: Please Note: No one in this thread (above) is making any claims about any specific person, just offering information about various investments.  There are no people named in the thread above this post.

However, I am stating that Shabbar Mughal sent legal threats to MMM about this thread.

That should tell you enough about him, but if not, please read more information about the types of products he may or may not sell, above, to educate yourself before investing with someone who may sell these type of products.

EDIT 2: Thread is already appearing back on Google.  Ugly WAP view, but at least it's out there.
Title: Re: I dun goofed
Post by: arebelspy on October 21, 2014, 02:28:55 PM
Quote from: Barry Barrington on October 21, 2014, 01:44:01 PM
LOL You should read this link then www.pws-dubai.blogspot.com (http://www.pws-dubai.blogspot.com) as old Shabbar Mughal is listed there with some of the other guys that work at Prestige Wealth Solutions.

Wow, quite the indictment from "an ex female employee of PWS."

Calls PWS (Prestige Wealth Solutions) a "boiler room con."

It's a shame so many in the financial services industry are so eager and willing to prey on the less knowledgeable.
Title: Re: I dun goofed
Post by: Primm on October 22, 2014, 07:13:54 PM
That blog has been removed. Do you think the author may have received contact from our friend Shabbar Mughal or someone else at Prestige Wealth Solutions and been asked to take it down?

If you're reading this as well Shabbar Mughal, hi! *waves*

Edit:I found this though. Apart from the first "review", the others are pretty telling.

http://www.glassdoor.com/Reviews/Prestige-Wealth-Solutions-Reviews-E798956.htm
Title: Re: I dun goofed
Post by: arebelspy on October 22, 2014, 08:16:08 PM
Quote from: Primm on October 22, 2014, 07:13:54 PM
That blog has been removed. Do you think the author may have received contact from our friend Shabbar Mughal or someone else at Prestige Wealth Solutions and been asked to take it down?

If you're reading this as well Shabbar Mughal, hi! *waves*

Edit:I found this though. Apart from the first "review", the others are pretty telling.

http://www.glassdoor.com/Reviews/Prestige-Wealth-Solutions-Reviews-E798956.htm

That's too bad.  We should have saved a copy here to upload it.

Here's a screenshot of those glassdoor reviews of Prestige Wealth Solutions, in case they get removed.  Two one star reviews from current employees,

My favorite quote is "We are by definition one big con"

Hahahaha.

Quite telling for anyone looking to do business with them: "They teach you to lie and scam bookings then the advisors sign them up to plans that get them the most money and that they can not get out of."
Title: Re: I dun goofed
Post by: arebelspy on October 22, 2014, 08:22:40 PM
Ah, still up at Google's Cache (https://webcache.googleusercontent.com/search?q=cache%3Awww.pws-dubai.blogspot.com&oq=cache%3Awww.pws-dubai.blogspot.com&aqs=chrome..69i57j69i58.799j0j4&sourceid=chrome&es_sm=93&ie=UTF-8).  For now, til they get that removed.

Uploaded here for posterity.  Just unzip the attachment and open the html file for all the juicy details.

Here's some of the text, for someone Googling one of their names (it'll be easier to read if you download the attachment, but this works better for Google Bots):
This is Google's cache of http://pws-dubai.blogspot.com/. It is a snapshot of the page as it appeared on Oct 21, 2014 21:54:44 GMT. The current page could have changed in the meantime. Learn more
Tip: To quickly find your search term on this page, press Ctrl+F or ⌘-F (Mac) and use the find bar.

Text-only version
 
PWS - Prestige Wealth Solutions - QROPS Scam
The behind the scenes truth about life in a Dubai boiler room

HomeThe RingleadersThe MinionsThe Call ScriptDictatorship E-MailsThe Fake Offer LetterThe Fake ContractImagesLinksDisclaimer
PWS - Prestige Wealth Solutions, The Inside Story


After you read this please visit the links page as there is lots of useful information that is always updated.

As an ex female employee of PWS - Prestige Wealth Solutions from January 2014 to April 2014 all I have to say to a prospective employee (or potential client) is DO NOT WORK FOR THEM EVER!! They are liars, cheats, bullies, sexist and vile scum bags.

I have had to return to the UK after spending all my savings and getting into massive debt after I (and others) stupidly fell for the dream they sold me. At the group interview held by PWS - Prestige Wealth Solutions in a hotel by Heathrow Airport hosted by Craig McConnon, Jamie Scott, Alex Herbert and Afzaal Abbas (aka Joe, Af or fondly known by the other guys in the office as Hitler) was promised a proper salary and rent contributions as well as flight home, visa and medical insurance and I was also told I would be earning approx Ł40K - Ł50K within my first year and that I would only need Ł2000 to start up there whilst everything was being processed. I had researched everything as I had heard the all the horror stories about DeVere and GlobalEye pay structures but they promised to be something different, oh how wrong I was.

Regardless of what the contract actually says (see this on the links above) this is worth nothing as at PWS - Prestige Wealth Solutions they do not follow this in fact PWS - Prestige Wealth Solutions don't pay you a salary they loan you 6K AED and when you finally get advisor they give you 3K AED from that you are in debt 6K every month till you earn something which is impossible if you are new to the country with no connections like I was.

I got no help when I was there even when I asked and when I had to move apartment several times no one helped from PWS - Prestige Wealth Solutions helped me to find a place like they said they would. PWS - Prestige Wealth Solutions always paid my wages late and to this date they still owe me money for the things they promised, they made you stay late sometimes till 9pm with no notice, they forced you to go to company events, as a female in that place I was always mocked for what I wore, my makeup and hair also I was ignored and left out of conversations and they always moved my desk for no reason.

The way PWS - Prestige Wealth Solutions get data is a joke as well, they call companies pretending to be from the Expo2020, Event companies or British Embassy to try and trick the receptionist into giving British names and numbers. PWS - Prestige Wealth Solutions used to promise the under paid staff at stores like DU, Etisalat and laundries jobs in exchange for data, pay recruiters, estate agents and gyms for data as well basically anywhere English ex pats would go they would hustle and bribe their way in. My advice would be not to give your mobile number to any of these places and if you do just by an alternative sim and then watch the calls come in.

PWS - Prestige Wealth Solutions is basically a boiler room, hit them hard and fast to get their money before they realise what's happened and it's all under the guise of 'helping people'.

PWS - Prestige Wealth Solutions have no license even though they claim too, they rent an office along with all the equipment, no one has a visa (some as long as 6+ months) with the only people having visas are those closest to Craig McConnon (MD). If it was to all go tits up they could easily cut and run leaving everyone high and dry.

When PWS - Prestige Wealth Solutions opened their new office at The Oberoi Centre (Office 901) in Business Bay there was no license so they were not legally allowed to trade but that did not stop them and when there was an inspection we all had to leave the office but instead of going home they made us stay in an office in the other building to get their monies worth, I bet now they are still doing it.

Also this mob are so paranoid they read ALL the staff’s E-Mail both in and out and do not allow you to change the passwords on your PC so that they can go through them when you are not in the office, they also read your personal E-Mail if logged in and also have keyloggers on the PC’s to read what you put.

The advisors there do not have licenses although some claim to have UK qualifications.

Also PWS - Prestige Wealth Solutions have now opened an office in Qatar (where they said I could go as well but lied about that too), Cape Town and Johannesburg again all with no licences or backdoor ways in.

All I can say is that I wouldn't meet or trust these cowboys with anything and I am glad I am back in the UK away from these scum bags!

I warn anyone that is offered a job with them DO NOT TAKE IT or anyone thinking about doing business with them DON'T!!

You may think I am being out of order, bitter, vindictive or just lying about this but I can tell you now I am not, the reason I did this is because they screwed with me personally and financially and although the rest of these blogs you read may (as they claim to people that have see them) have been written by other brokers this is a genuine blog that has been backed up with images and contracts that they will no doubt try and get removed so that nobody reads this or tell you that I was shit at my job or some other rubbish to focus you away from this. Trust me, trust your gut, ask your pension provider.

*!FINANCIAL ADVISORS GET RECOMMENDED IN DUBAI THEY DON'T COLD CALL!*
Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon Dubai, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, Shabbar Mughal, UAE, Wealth Management
The Minions
These are some of the 'Financial Advisors' that will come out to see you wherever you are should you be silly enough to want to hear what they have to say or you just feel like having a free coffee. Unfortunately I don't have all their pictures just yet but I will have a whole collection for you soon.

 
Anthony Anderson


Bilal MUGhal


Marlon Bruges


Shabbar Mughal

Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon Dubai, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, Shabbar Mughal, SIPP, UAE, Wealth Management
The Ringleaders

Be aware of the following ringleaders that run PWS - Prestige Wealth Solutions.
(information is freely available on LinkedIn as well as their pictures)

The Main Man
Craig McConnon FAIQ (CII) - Managing Director
UAE Mobile: +971 (0) 56 115 0855 | International: +971 (0) 426 7169
email: c.mcconnon@pws-intl.com


The Great Af Abbas
Af Abbas (Afzaal Abbas or Joe) - Head of Relationship Management
UAE Mobile: +971 (0) 50 594 5397 | Personal: +971 (0) 50 927 4103
email: a.abbas@pws-intl.com


Alex Herbert
Alex Herbert
Regional Managing Partner
UAE Mobile: +971 (0) 56 691 4021 | Direct Dial: +971 (0) 4 374 2212
email a.herbert@pws-intl.com


Jamie Scott
Jamie Scott
Regional Managing Partner
UAE Mobile: +971 (0) 56 170 6698
email: j.scott@pws-intl.com
Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, SIPP, UAE, Wealth Management
The Call Script
So now you have read my previous post here is a look at one of the objection handling 'scripts' I was given. As you can see it lists all the known objections that someone would normally use to get them off the phone and THIS is how they have been told to handle those objections, open this page and try them out. Oh they they will get really happy and love it when they hear you have a frozen pension from BP, Shell, Fire Service, NHS, Teachers Pension, Army Pension or anything in the 15yr or Ł100K+ range.

Objection handling:

Customer says already invests in property:
Well as we all know property is the cornerstone of any successful portfolio.....
Where is your property?
Is it for investment or as a retirement property?
So you're aware that your primary income will be non-existent when you do retire and that secondary income will be your only security for your future?
So if we could help you to diversify your portfolio just to cover yourself in the event that should there be another property crash which I'm pretty sure you were hit quite bad the last time and you don't want that to happen again am I right?

So now do you see the benefits of sitting down with one of our advisors?
Illiquid asset which means you can't get access to that money at any given time
Historical volatility which you will be subject to-your retirement plan is subject to market fluctuations...lead into diversification recommendation
We can give you access to other asset classes due to strategic allegiances with some of the biggest institutions in the world, lead into independent brokerage benefits
Don't put all of your eggs in one basket reduce risk and incorporate diversification
Maintenance cost -living in it or renting it out for income
Customer claims to already have an IFA:
So you must take your finances very seriously and in this day and age who doesn't have an advisor?
Are they based in the UK or out here in the Middle East? Excellent although Mr Client if you were living back in the UK would you have an advisor based in the Middle East? Also your adviser in the UK can only offer UK based products, we however are a global entity and can complement your portfolio with access to tax free products because we're based in the middle-east you can see the benefit in that can't you?
I Bank with HSBC/Barclays etc - Compliment - That then means they can only give you access to HSBC products because they are a tied agent...does that make sense? Well as we are an independent global entity, we have access to a wider range of products due to the fact we have strategic alliances with most of the leading institutions.../ist them...and because of this we have access to many exclusive products that HSBC can't offer you...does that make sense?
Possibly touch on Interest rates and inflation
Franchise bank - HSBC is not HSBC in Dubai - They paid for a name above the door
Customer claims they haven't got any money:
Ok, well it sounds like we should have had this conversation 10 years ago,then when I rang today you wouldn't be saying you haven't got any money...hahah
Well fortunately,you can benefit from what we do without any cost or commitment from yourself and it doesn't cost you anything to be open minded does it...
Customer asks to send them an email:
Unfortunately I can't do that,if I was to send you a long generic E-Mail will probably sit in your inbox and this phone call would have been a waist of your time Mr Client hahaha, we provide a tailor made service...ok? So if you were to buy a tailor made suit,it wouldn't be a generic 1size fits all and probably won't fit the guy sitting on your right or on your left- am I right?
We personalise what we do for each client's circumstance, requirements and goals- we work on a face to face basis so we can get a better understanding of how we can help you ok?
Customer wants to meet in a Coffee Shop
Unfortunately we don't do meetings in coffee shops
I'm sure whilst you are having a personal financial health check you wouldn't want a crowd of people roaming around you as you wouldn't  want the same thing during a personal physical health checkup,am I right hahaha. (then find out where he works/lives, imply that the advisor will already be in the area next week)
Customer get these calls all the time:
Ok so I guess you've been in Dubai for a long time then hahaha. So what was it that's made you reluctant to sit down with an advisor regardless of what they say...Well I'm guessing it's safe to say you take your finances very seriously and manage your own portfolio or already have an IFA?  Whichever of the 2 answers he gives revert back to IFA objection handling above.
Then lead into the benefits of sitting down with us (Independent,leading institutions,tax free,  if you know he has a good pension...! didn't call you regarding anything except the recent HMRC legislation changes which you might not have been made aware of)
Customer is not interested:

Ok Mr Client, what is it you are not interested in? Smokescreen (Regardless of whatever the person says revert back to other objection handling related to the answer).
Education Planning:
I'm sure you are aware of the rise in education costs? 7-9
I'm sure like yourself you want the best for your kids and would like to be able to send them to university enabling them to have the best education am I right?
So how important is it for you to send your kids to university?
So how would you feel if you were unable to send them?
I'm sure you can see the benefits of having a no cost no commitment meeting with one of our senior advisors?

Excellent when is good for you? Start/Middle/End of the week..... Morning/Lunch Afternoon?



Just in case we forgot this board would be placed in the office.
Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, SIPP, UAE, Wealth Management
Dictatorship E-Mails
Obviously what use is the use of being the 'master' of a company where you can't send the odd E-Mail or two to your staff about how you want them to work or how to steal information etc?

Here is a selection of such E-Mails that would be sent to us on a daily basis.


Our daily structure

Our rules


Where they wanted us to get YOUR information from.


OMG Yes just ONE data source can make your year!!


Heaven forbid someone that tries scamming the company for some money!

Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, SIPP, UAE, Wealth Management
The Fake Offer Letter
This is the offer letter I (and others) got from PWS - Prestige Wealth Solutions, doesn't it look all nice and professional and the money, well that's just amazing. Shame it doesn't mean a thing when you arrive!





Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, SIPP, UAE, Wealth Management
The Fake Contract
Now below is the contract that PWS - Prestige Wealth Solutions had me sign, if you read it it all looks good however I have highlighted some parts that they did not do.


















Labels: Af, Afzaal Abbas, Alex Herbert, Boiler Room, British Expats, Craig McConnon, Dubai, Financial Planning, Fraud, Prestige Wealth Solutions, PWS, PWS Dubai, QROPS, SIPP, UAE, Wealth Management
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Title: Re: I dun goofed
Post by: Prepube on October 25, 2014, 09:58:44 PM
What is "Jack Salmoning"?  References to it in the emails she posted and in the schedules.
Title: Re: I dun goofed
Post by: dungoofed on October 25, 2014, 10:22:59 PM
It's when you cold call and pretend you're from another company to try and get information from the target. "Hi I'm from the State Names Department, just calling to make sure the information I have on you and in our database is correct..." etc
Title: Re: I dun goofed
Post by: MarciaB on October 26, 2014, 10:59:08 AM
Quote from: dungoofed on September 04, 2014, 06:02:09 PM
Cool, thanks.

In other news, Name and Shame coming soon - watch this space.

Also might do a "Where are they now?" special once this phoenix has risen from the ashes and is in slightly better financial shape.

Hey - I love this "Where are they now?" thread idea - and it might even be worth having a whole separate forum section for this. It's not quite the same as Share Your Badassity because of all the initial posts by forum members prior to the resolution of the situation or action taken.

ARebelSpy - is this worth considering? You're the forum guru, right? Perhaps a section where the instructions state that the OP writes a post giving the link to the Ask a Mustachian thread and says how long it's been since the initial discussion. Maybe provides a couple of sentences of summary as to the initial issue ("In January 2014 I was debating taking a new job in NY vs staying at my current job in FL. The big issues were pay difference, cost of living, family, and my herd of pygmy goats.") And then goes on to post what happened and why.

One of the great things about the forums is the opportunity to learn from someone else's choices (the good, the bad, the ugly). And after you've posted a few times on someone's situation you get invested into what happens to them. Having an epilogue of sorts would be great.

Title: Re: I dun goofed
Post by: arebelspy on October 26, 2014, 07:33:46 PM
Quote from: MarciaB on October 26, 2014, 10:59:08 AM
Quote from: dungoofed on September 04, 2014, 06:02:09 PM
Cool, thanks.

In other news, Name and Shame coming soon - watch this space.

Also might do a "Where are they now?" special once this phoenix has risen from the ashes and is in slightly better financial shape.

Hey - I love this "Where are they now?" thread idea - and it might even be worth having a whole separate forum section for this. It's not quite the same as Share Your Badassity because of all the initial posts by forum members prior to the resolution of the situation or action taken.

ARebelSpy - is this worth considering? You're the forum guru, right? Perhaps a section where the instructions state that the OP writes a post giving the link to the Ask a Mustachian thread and says how long it's been since the initial discussion. Maybe provides a couple of sentences of summary as to the initial issue ("In January 2014 I was debating taking a new job in NY vs staying at my current job in FL. The big issues were pay difference, cost of living, family, and my herd of pygmy goats.") And then goes on to post what happened and why.

One of the great things about the forums is the opportunity to learn from someone else's choices (the good, the bad, the ugly). And after you've posted a few times on someone's situation you get invested into what happens to them. Having an epilogue of sorts would be great.

Good idea.  I feel like though, in general, don't come back to update.  It is nice when they do though, and bump their old thread with the results.  :)
Title: Re: I dun goofed
Post by: arebelspy on October 26, 2014, 07:44:46 PM
Quote from: Primm on October 22, 2014, 07:13:54 PM
That blog has been removed. Do you think the author may have received contact from our friend Shabbar Mughal or someone else at Prestige Wealth Solutions and been asked to take it down?

So both MMM and myself have been contacted by an individual claiming to have written, and subsequently removed, this blog (https://webcache.googleusercontent.com/search?q=cache%3Awww.pws-dubai.blogspot.com&oq=cache%3Awww.pws-dubai.blogspot.com&aqs=chrome..69i57j69i58.799j0j4&sourceid=chrome&es_sm=93&ie=UTF-8) (Google cache link - still available for now, but also cut and pasted 5 posts up as well as in a .zip attachment for easier reading 5 posts up).

They write:
Quote
Hi,
Please can you remove this post:

forum.mrmoneymustache.com/investor-alley/i-dun-goofed/msg431938/#msg431938

This site was created by myself for my own reasons and should not have been reproduced (certainly without not without my consent) it was totally fictitious and contains extremely libellous content and false statements about company practices that were damaging to the companies reputation.

I have since removed this content due to personal reasons however a member of your site has reproduced this with out my consent and posted it on your forum and as such I would like it removed.

If you wish I can create a page on the blog as proof that I am who I say I am and that I did create it.

I look forward to your response on this.

As of this writing, this forum is not in the habit of removing posts. 

John Stuart Mill talks a great deal about the marketplace of ideas, and that the truth will win out.

If what the author wrote there is indeed false, and PWS is a great company, cool.  Their customers and employees will be happy, and they'll recommend them to friends, and the business will prosper.

If, on the other hand, what is written is true, then hopefully having it available will be a resource for people googling for information.

So far here's what we know about the company:
1) We've had several people posting on this thread unhappy with their products
2) We've had legal threats by the company to MMM, and ostensibly to one danclarke individual on here, who has since edited his posts.
3) We have a former employee writing a whole scathing blog about the company (which is either true, or, if false, they at least made a former employee so upset as to make up things about them).
4) We have several former employees writing negative reviews on glassdoor.com
5) We have the company VERY closely monitoring their social media and google presence, such that they immediately threaten legal action to people here when negative things are posted, get blogs removed within days of being posted, etc.

1, 2, and 5 are facts.  The content in 3 and 4 may or may not be true, but was written.

Then you have other things, like if you Google Craig McConnon FAIQ (CII) - Managing Director (whom the blog referred to as "The Main Man") you get sites like this:
http://craigmcconnonscam.blogspot.com/

Which states:
Quote
Craig McConnon and Advanced Global Trading Scam Review

The Advanced Global Trading Scam has this week hit the headlines again with conman Craig McConnon at the centre of it. Authorities in Dubai have released new information implicating this man for selling illegal carbon credits to unsuspecting people. He is even mentioned on our financial services authority website here in the US telling Americans to avoid him in the Middle East
Craig McConnon and Advanced Global Trading promised investors 30% returns and “for a minimum investment of $25K you too can invest in Carbon and make a difference,” the company said on its website. However, after announcing the market was about to crash, investors were given a dodgy way out but to make this deal go through, the clients were asked put in an extra $15,000.
He is still trying to sell these carbon credits in the UAE today and people are still being taken for a ride. He is supposed to be a financial analyst or something so be warned, do not trust this man with a dime of your own money.

Again, hearsay.  But something to consider.

I leave it to you, the reader, to decide if you want to do business with this company.

But this forum is not in the business of judging which of the above statements are factual and which are not.  We do not hold that they are true, but they may be.  We are not responsible for the content written by others.  We are not in the business of censoring opinions, facts, or otherwise.

If this company is as bad as multiple people have said, I hope leaving this available, rather than removing it, helps people avoid them.  If the company is good, this will get buried and forgotten and they will prosper.

Make your own judgements.

Cheers!  :)

Title: Re: I dun goofed
Post by: ceeawf on November 09, 2014, 04:47:20 AM
Dear all,

I also have been hoodwinked by the Royal London 360 Quantum scam, this time Holborn assets in Dubai. I signed up to a 15 year policy and despite multiple requests to see the commission structure I was never given it.

My predicament is this:

I have invested $1000k per month for 43 months (investment term 180 Months). The current investments is “worth” a little over $41k (-2.5%). If I cancel the policy I will walk away with $31k losing $12k USD.

Can anyone advice if I should walk away now and cancel the policy banking my 31k. Or continue to pay the premiums but remove Holborn as the “Financial Advisor”?

Any help would be really appreciated.

Regards

Title: Re: I dun goofed
Post by: LeboLebo on November 09, 2014, 05:09:01 AM
ceewf, I'm also in Dubai, and despite their catchy little radio commercials would never use Holborn Assets.

You are always better off in a low cost fund (Vanguard anyone?)

I'm sure you can run the numbers and see you are better off walking away from this 12k and chalking it up to a sunk cost.

Really, in just over 3 years this investment vehicle has offered a negative return!? The market has been on a recovery tear at this time. Something doesn't add up.
Title: Re: I dun goofed
Post by: arebelspy on November 09, 2014, 07:22:20 AM
Quote from: LeboLebo on November 09, 2014, 05:09:01 AM
Really, in just over 3 years this investment vehicle has offered a negative return!? The market has been on a recovery tear at this time. Something doesn't add up.
 

That's what happens when you pay such high fees and commissions. =/

Sorry that happened ceeawf.
Title: Re: I dun goofed
Post by: danclarkie on November 09, 2014, 11:24:21 AM
Another happy customer: Royal London Quantum 360 Dubai (http://www.askaboutmoney.com/showthread.php?t=187114)

There is a very good breakdown of the details on the link above.

My favourite comment is:

Quote
In short, if someone had gone out of his way to structure a more inappropriate investment, it would frankly have been difficult to do.

Very interesting to hear that ceeawf had a poor experience with that financial company.
When I met with them (via referral, not cold call) they explained how they were different from the other IFA companies.

Most puzzling is that a representative of that company has a regular column in the national newspaper (http://www.thenational.ae/business/personal-finance/it-is-best-to-settle-unpaid-uae-debts)!

Since the beginning of this year, I've been cold called by 4 other IFA companies.
I was even cold called again by the very same company that sold me the product I walked away from.

All want to sell the same products.
None are interested in talking about ETF Index funds with low expense ratios.
Title: Re: I dun goofed
Post by: dungoofed on November 09, 2014, 02:04:29 PM
Quote from: LeboLebo on November 09, 2014, 05:09:01 AM
Really, in just over 3 years this investment vehicle has offered a negative return!? The market has been on a recovery tear at this time. Something doesn't add up.

I believe the pre-surrender value of the plan would have been positive, but there is an early withdrawal "fee" that forces most people to stay the course even when they realise they've been had, sunk costs be damned.

ceeawf - there is a spreadsheet linked to higher up in this thread. Use that to make the decision. There's a chance that it will actually be better for you to keep pumping money into this thing, but I suspect if nothing else, mentally you are better off jettisoning the plan and taking the 12k loss. I lost 50k but I'm glad I did just to have nothing more to do with the plan any more.
Title: Re: I dun goofed
Post by: ceeawf on November 09, 2014, 09:23:28 PM
All,

Thanks for the replies. I am continuing to do my research and have a meeting this with with the company in question this week.

I rread on an earlier post that these types of investment propositions are now not legal in the UK? Can anyone give me some specific detail on this?

I was consistantly told that the company in question was the only company in the UAE that works to the same standards as if it was auditied by the UK banking system and financial authority.

Regards,

Ceeawf
Title: Re: I dun goofed
Post by: danclarkie on November 09, 2014, 10:30:29 PM
Quote from: ceeawf on November 09, 2014, 09:23:28 PM
All,

Thanks for the replies. I am continuing to do my research and have a meeting this with with the company in question this week.

I read on an earlier post that these types of investment propositions are now not legal in the UK? Can anyone give me some specific detail on this?

I was consistently told that the company in question was the only company in the UAE that works to the same standards as if it was audited by the UK banking system and financial authority.

Regards,

Ceeawf

The RDR is the Retail Distribution Review that came into effect on 31 December 2012 in the United Kingdom.

http://www.fca.org.uk/firms/firm-types/sole-advisers/rdr

Main points are that:

Quote
Adviser charging
You must set a charging structure before 31 December 2012. You will not be able to take commission for new advice and you need to disclose upfront how much your advice will cost and how it will be paid.

Quote
Description of advice services
All advisers will need to disclose their advice service as either independent or restricted with effect from 31 December 2012.

If you want to carry on calling yourself an independent financial adviser you will need to consider all retail investment products.  This is wider than the current range of packaged products.  It includes structured products, unregulated collective investment schemes (UCIS, exchange traded funds (ETFs) and investment trusts. We are not saying that you have to advise on all of these products, but you need to remain able to advise on them if required.

Assuming that your adviser did not tell you:

I get paid a lump sum commission on day one of you signing up for this scheme.
The longer the term of the scheme, the more commission I make
This is the amount of commission I will receive
After the initial allocation period (usually 2 years) I receive no further financial incentive to continue to manage your investments for you.

and

That you adviser failed to advise you on the alternative investment options, such as UCIS, ETFs, etc.

Then the advice you received would fall foul of the RDR imposed by the Financial Conduct Authority of the United Kingdom

The policy explicitly states its aims are:


Quote
Independent advice is truly independent and reflects investors’ needs.
People can clearly identify and understand the service they are being offered.
Commission-bias is removed from the system and recommendations made by advisers are not influenced by product providers.
Investors know up-front how much advice is going to cost and how they will pay for it.
All investment advisers will be qualified to a new, higher level, regarded as equivalent to the first year of a degree[16]

and, that as a result:

Quote
The combination of these factors is expected to significantly reduce the profitability of many FI practices.
http://en.wikipedia.org/wiki/Financial_Services_Authority#Retail_consumers

Here is some advice from the FCA regarding how to deal with a suspected financial scam.
This is mostly only applicable to the UK and provided here for reference only:

FCA advice on financial scams (http://www.fca.org.uk/consumers/scams/report-scam)

Regarding you specific adviser, it seems he has taken large efforts to protect his online reputation.
I have PM'ed you some details I found through some obscure Google searches, that someone has since paid to have taken offline.
Title: Re: I dun goofed
Post by: marty998 on November 09, 2014, 10:45:04 PM
Quote from: ceeawf on November 09, 2014, 09:23:28 PM

I was consistantly told that the company in question was the only company in the UAE that works to the same standards as if it was auditied by the UK banking system and financial authority.


And that gave you comfort after all those London banks were caught out rigging LIBOR amongst other nefarious things over the past few years? Audits are not what you (and the general public) think they are. Very very few audits actually pick up fraud, illegal transactions etc. It's unfortunate, but public perception of what an audit is goes beyond the capabilities of most auditors.

What auditors do give comfort over is that financial statements are prepared in accordance with accounting standards. However it doesn't prove a company is going to be worthy of your investment.

Never, ever trust a salesman. Always DYOR fully and if it smells like a pile o' shit chances are it probably is.

My golden rule is that if an investment requires wining, dining, financial planners and celebrities to sell it then I don't go anywhere near it.
Title: Re: I dun goofed
Post by: marty998 on November 09, 2014, 11:05:09 PM
Quote from: arebelspy on October 26, 2014, 07:33:46 PM
Quote from: MarciaB on October 26, 2014, 10:59:08 AM
Quote from: dungoofed on September 04, 2014, 06:02:09 PM
Cool, thanks.

In other news, Name and Shame coming soon - watch this space.

Also might do a "Where are they now?" special once this phoenix has risen from the ashes and is in slightly better financial shape.

Hey - I love this "Where are they now?" thread idea - and it might even be worth having a whole separate forum section for this. It's not quite the same as Share Your Badassity because of all the initial posts by forum members prior to the resolution of the situation or action taken.

ARebelSpy - is this worth considering? You're the forum guru, right? Perhaps a section where the instructions state that the OP writes a post giving the link to the Ask a Mustachian thread and says how long it's been since the initial discussion. Maybe provides a couple of sentences of summary as to the initial issue ("In January 2014 I was debating taking a new job in NY vs staying at my current job in FL. The big issues were pay difference, cost of living, family, and my herd of pygmy goats.") And then goes on to post what happened and why.

One of the great things about the forums is the opportunity to learn from someone else's choices (the good, the bad, the ugly). And after you've posted a few times on someone's situation you get invested into what happens to them. Having an epilogue of sorts would be great.

Good idea.  I feel like though, in general, don't come back to update.  It is nice when they do though, and bump their old thread with the results.  :)

I was just reading through some of the 2011 MMM blog posts late yesterday. I really do want to know what happened to this guy:

http://www.mrmoneymustache.com/2011/08/29/reader-case-study-how-can-i-climb-out-of-the-gutter/

Wonder if anything has changed in 3 years?
Title: Re: I dun goofed
Post by: dragoncar on November 10, 2014, 12:34:31 AM
Quote from: ceeawf on November 09, 2014, 04:47:20 AM
I have invested $1000k per month


I'm really sorry you got tied up in this "scam."  But at least with $1 million monthly disposable income, you should do OK ;-)
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 10, 2014, 10:54:23 PM
Oh my, I hadn't noticed this thread was about Royal London 360 until just now. Was the thread title changed recently?

I have a policy with them that was originally opened with Scottish Provident, a similar company that I believe was merger-aquisitioned into RL360 some years ago. I wrote a fair bit about the unpleasant experience over on the Retire Japan forum. (The link to that thread is http://www.retirejapan.info/forum.html#/20140624/offshore-investing-4035240/ . If it's not kosher to link out like this, please feel free to delete this bit.)

I had stopped paying into the policy many years ago and had basically mentally written it off as likely lost. I'm going to have to look at it again to decide if it's worth surrendering the policy and taking a major loss on it, or keep it in hopes that it will pay out something close to its current value when it matures.

In short, I agree with the posts above. Don't buy products like these, from people like these.
Title: Re: I dun goofed
Post by: eyePod on November 11, 2014, 06:43:19 AM
Quote from: marty998 on November 09, 2014, 10:45:04 PM
Quote from: ceeawf on November 09, 2014, 09:23:28 PM

I was consistantly told that the company in question was the only company in the UAE that works to the same standards as if it was auditied by the UK banking system and financial authority.


And that gave you comfort after all those London banks were caught out rigging LIBOR amongst other nefarious things over the past few years? Audits are not what you (and the general public) think they are. Very very few audits actually pick up fraud, illegal transactions etc. It's unfortunate, but public perception of what an audit is goes beyond the capabilities of most auditors.

What auditors do give comfort over is that financial statements are prepared in accordance with accounting standards. However it doesn't prove a company is going to be worthy of your investment.

Never, ever trust a salesman. Always DYOR fully and if it smells like a pile o' shit chances are it probably is.

My golden rule is that if an investment requires wining, dining, financial planners and celebrities to sell it then I don't go anywhere near it.

Your audit comment reminds me of all of the programs that re-certify you. The Last Psychiatrist had a great post (http://thelastpsychiatrist.com/2014/04/the_maintenance_of_certificati.html (http://thelastpsychiatrist.com/2014/04/the_maintenance_of_certificati.html))about required testing that you can continually take until you pass (have to pay each time though). The only thing that it shows is that you completed a test successfully, with no information on how you got there. Finally, the information wasn't even topical (his example was that there were no questions on Xanax, the drug most prescribed by psychiatrists.)

I guess my point was most of this is smoke and mirrors to make everyone feel like this is all under control when most people have no idea what they are doing.
Title: Re: Royal London 360 - I dun goofed
Post by: richo on November 14, 2014, 08:19:21 AM
I’ve been meaning to post here for a while as it was my reading of this thread a few months back that made me realize I too had been led down the RL 360 garden path.

I ended up surrendering my USD16,000 initial investment (I prefer to think of it as the cost of my financial education) and have switched across to low fee ETF investing via TD International in Luxembourg (I’m an NZer based in Korea).

Danclarkie’s spreadsheet (linked higher up in the thread) really awakened me to the array of ‘bonuses’ and fees involved and the harsh reality of the impact of those on my returns.

When I showed my advisor the spreadsheet based on my investment, he (not surprisingly) argued that the average annual fee of 3%+ I quoted was not true and in reality it was much lower due to the impact of the bonuses.

So I ended up building my own version (linked here https://docs.google.com/spreadsheets/d/1XJGZpcPxKPoAXgsKo9VHez2NbCTU9W_LjJ1W-fAGFxU/edit?usp=sharing) to try to convert all the costs (and bonuses) into a single fixed annual % fee – the result was still high at around 1.9% per annum. I also added in a section to take into account the impact of the surrender fee and shorter investment period in an alternative platform to determine if I was better off to swap, which told me that as long I the fee on an alternative platform was less than 0.9% per annum I should jump ship. Of course, ETF fees aren’t anywhere near that high, so it was a no-brainer to swap.

Hopefully the spreadsheet can be of some assistance to others. I don’t guarantee that it’s perfect as I’m pretty new to this stuff (and can’t be that smart as I did invest in RL 360…) but I am very thankful to all the posters here for setting me on the right path and it would be nice if I could play my part to do the same for others.
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 16, 2014, 01:09:46 AM
Hey richo really sorry to hear, but mate thanks for having the courage to add to the thread.

"Bonuses" is a new one - my IFA used "taxes" and "points you receive back on your credit card" as his two last-ditch attempts to get me to stay the course.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 24, 2014, 08:28:54 PM
Thanks for making this post, I recently was approached by someone in japan with 360 and the advisor I met also mentioned the starting + finishing bonuses and credit card points. I printed off this thread to bring our next meeting and am looking forward to what he has to say... but I sent an email about the fees and the advisor sent me this. Is it true or not?
http://www.rl360adviser.com/generic/downloads/qu016.pdf
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on November 24, 2014, 08:49:22 PM
Quote from: timjp on November 24, 2014, 08:28:54 PM
Thanks for making this post, I recently was approached by someone in japan with 360 and the advisor I met also mentioned the starting + finishing bonuses and credit card points. I printed off this thread to bring our next meeting and am looking forward to what he has to say... but I sent an email about the fees and the advisor sent me this. Is it true or not?
http://www.rl360adviser.com/generic/downloads/qu016.pdf

Of course it is true.  How could you be such a doubter?  Also, please be sure to trust the audience shill who points out the bent corner during the 3 card monte game....

And note "The growth rates shown are per year and do not include the contract charge (1.5% p.a. taken monthly in arrears) and external fund management charges."
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 24, 2014, 10:16:24 PM
Ok. So with that 1.5% what I am looking at, that's 1.59% growth necessary? (25 year 10000 usd pm)

For me the structured idea (retirement forget and ignore sort of thing) was the only reason I was considering it before seeing this thread, is anyone doing something better in Japan? Where should I be looking?
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on November 24, 2014, 10:37:11 PM
Quote from: timjp on November 24, 2014, 10:16:24 PM
Ok. So with that 1.5% what I am looking at, that's 1.59% growth necessary?

For me the structured idea (retirement forget and ignore sort of thing) was the only reason I was considering it before seeing this thread, is anyone doing something better in Japan? Where should I be looking?

Oh boy, where to start? 

Perhaps with..."For financial advisers only. Not to be distributed to, nor relied on, by retail clients."  And this was sent to you by the, ahem, financial adviser?  Who may be wanting you to think you are getting "inside information", despite the part about retail clients not being able to rely on it?

I assume you are looking at the .09% required for $1,000 over 25 years to get the 1.59% in your post.  But even that doesn't include the "external fund management charges," however much they are, so you have to add them as well.  And this is the minimum return you would need to avoid losing money.

Unfortunately I don't know anything about investment options for someone in Japan, but I have to think there are better....
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 24, 2014, 10:54:13 PM
TimJP Trust me, just walk away. Don't even meet him again. Cancel the meeting.

It doesn't matter how prepared you are, the guy on the other side of the table DESTROYS OBJECTIONS FOR A LIVING. That's what he does, and he has centuries of experience in the form of the materials that have been put together for him. You cannot out-argue him in a million years.

My suggestion is to periodically send money home via Ozforex or one of these services, and invest in your home country.

If you want to get fancy, consider opening a trading account locally with Rakuten or SBI, maybe consider a NISA account with one of these two as well, and if you want to go uber-fancy you can try opening a brokerage account in either Singapore or Hong Kong.

Title: Re: Royal London 360 - I dun goofed
Post by: DavidAnnArbor on November 24, 2014, 10:58:09 PM
Wow I think everyone can relate to this whole topic/thread.  In one way or another we have all been bamboozled out of money for something we thought was going to lead to some expected outcome that turned out to be a mirage.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 24, 2014, 11:34:21 PM
Thanks for all the information.

Nothing about insider information. He was actually pretty clear about the fees, with fund management fees the performance he was showing was after fees so I wasn't really thinking about that. How does this affect the funds pricing?

Not really sure about opening a trading account because, I don't know how long I am going to be in Japan and which country I'll be working in next. Plus I don't know much about trading and the accounts are all in Japanese.

Is there a simpler option than an overseas brokerage and sending money?
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 24, 2014, 11:49:27 PM
What is it specifically that is too complicated?

Opening an account with Ozforex?

Opening a trading account in your home country?
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 25, 2014, 12:00:33 AM
This might be the wrong place for it but just setting things up and maintaining it. Something like a credit card option, or streamlining things to make it more automatic.

Is this hard to do with ozforex, mufj and the commonwealth bank?
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 25, 2014, 01:18:25 AM
I don't have a way to automatically invest a fixed amount from your credit card each month but I do have an alternative. Save up 500,000 yen and send that home, then start saving again towards the next 500,000. Repeat.

Sometimes it may take you three months, sometimes it may take you two, and other times it might take you five. This flexibility is a good thing.

If you commit to, say, 150,000 a month on the RL360, do you know what happens when you are earning more and want to increase it to 200,000? (and this *will* happen). You have to pay more in fees in order to deposit more.

Here's a guy in the comments who got started with Ozforex in Japan with Shinsei and pays no remittance fees:

http://expatfinance.net/international-bank-transfers-correspondent-bank-fees

Any reason you are with Commonwealth Bank? I have HSBC in Australia and if you have a couple of laddered $5000 term deposits with them there are no bank fees ever.

I also do my trading with them. It's not cheap at $16/trade but it's cheaper than RL360 will ever be.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 25, 2014, 06:24:25 AM
Thanks for all the advice.

I'll have a look into things. For a guy in Dubai you sure know your stuff about Japan, I'll see if I can find a way to automate the process.
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 25, 2014, 06:35:59 AM
You may need about a month to get the Ozforex account and a trading account set up in Australia, because of the documentation involved. But it's still worth it.
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 25, 2014, 07:59:36 PM
timjp - dungoofed is right. Cancel the meeting with the RL360 guy.

Did you see this article? (I just found it on the reddit subforum linked to in one of the above articles.)

http://www.japantimes.co.jp/community/2014/02/26/general/its-their-plan-for-your-money-so-assume-deception

It sounds like you like the automatic contributions via your credit card aspect. I can see that. That's about the only thing you could say these plans have going for them.

I'm a US citizen and I have a Charles Schwab account, so I use that. They have an account with Citibank Japan that I can transfer to from my own Citibank Japan account, and it automatically gets converted to USD and credited to my Schwab account. Costs me 315yen per transfer, but unfortunately it can't be automated or done via phone so I have to go to a branch to make the deposit. Still, I consider it well worth it for being able to use Schwab for my investing.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 25, 2014, 08:12:17 PM
Thanks for the article, raises a lot of interesting points...but once again doesn't offer an alternative.

Citibank doesn't automate those things either?

The credit-card thing was a big selling point for me, RL360 is easy to set up. But how much should I be paying in fees for convenience?
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 25, 2014, 08:44:04 PM
I have asked a lot of people and there is no way to do the auto-credit-card thing as nicely as these products do.

DESPITE this, just walk away from the product and cut contact with the guy. This is my last response to you on this.

Learn from my mistake. That's what this thread is about (although it didn't start like that). You have done the hard work by reaching out to us and not thinking you were smart enough to think of all the possibilities on your own. This is harder to do than it sounds! Most people think they are too smart to have the wool pulled over their eyes, and they think that they have thought out all the possibilities. Walk away.

以上
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 25, 2014, 08:51:46 PM
Tim, in my opinion, you would be better off with your money sitting in a savings account earning the usual .01% interest. You could accumulate it there and then do the bank transfer process to a real brokerage account every few months, hell, even once a year if you wanted.

If the RL360 product they are pitching you is anything like the one I got, you are aware you can't pull the money out until the term of the policy is up? I.e. in 25 years? If you do, you'll forfeit 50-100% of the value of the policy?

The financial advisor is after the big up-front signing commission he will receive if he signs you on to a plan like this. After you are signed on, you will likely never hear from him again. (We didn't - our company signed on with a similar advisor when setting up our employees with these plans. After it was all set up, the guy became very hard to reach and eventually disappeared.)

The investment options available in the plan are limited, and the fees are not cheap. I'll have to crunch the numbers, but I think the results from my money in the global markets fund have been about break-even for the last several years. But they don't need to get good results from their funds if you can't get your money out and they don't have to worry about you transferring your balance to a competing broker.

I really think you would be better off just keeping your money in a savings account at this point. I suggest you ask around and try to find someone else in your company, circle of friends, Japan forums, etc, that have signed on to a policy like this and have good things to say about it. If you find such a person (I am wearing my skeptical face), find out what it is they like about the plan.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 26, 2014, 06:29:41 PM
Thanks James.

This is the fund guide I was sent? Are these funds not the fund managers but RL360 funds?
http://www.rl360adviser.com/generic/downloads/qu009.pdf

I'm aware of the 25 year lock up. But you can make partial withdrawals, so I don't feel like this is too much of an issue unless I cancel it within the next 5 years.
I should make it clear, I'm not talking about all my monthly savings going to RL360.

Commission is definitely a worry though.
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 26, 2014, 07:36:54 PM
Looking at that sheet, it looks like most of the listed funds are managed by other firms (Schroders, Franklin Mutual, Fidelity, etc.) I don't know if that's a good thing or bad. Presumably you'll end up paying fees to both RL360 and to the managing firms of the funds themselves. But at least you have some third party information about the various funds available and how they perform. Suggest you look at which funds you would be interested in and then search for those funds on the web and check out what their fees are like. I just checked a couple in the Global Equities section:

Franklin Mutual Global Discovery Fund - Gross Expense Ratio        1.28%
Schroder ISF Global Equity  - Ongoing Charges (latest available)       1.69 %
Jupiter JGF Merlin International Equities L A Inc GBP - Annual Charge 1.50%

Then you'll probably be paying RL360 their 1.5% on top of that, though they may not make that clear.

dungoofed has already made his last word on this subject. I think I will bow out as well. I can appreciate that you want to automate the process and forget about it, but it's worth the effort to create an alternative process. Even saving up cash and making a file transfer every six months or a year to a brokerage account would be a better deal.

There are investment trust products you can buy directly from Shinsei bank and I think (if you're not a US citizen) from Citibank accounts, which might work for you if simplicity is your overriding concern. You might want to look into them as well.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 26, 2014, 08:17:16 PM
Ok thanks.

The advisors presentation said, the percentages there are after the management fees of the fund companies have been taken away.

Alright, I'll have a look at the investors trust, I am an australian citizen so it should be fine.
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on November 26, 2014, 09:34:26 PM
There is an interesting but little known version of the Turing test.  In this version, one tries to distinguish between
  > an unwary investor seeking support for his hope that something seeming too good to be true, really is true - despite repeated contrary cautions
  > an agent of a financial firm trying to lure unwary investors by pretending to ask questions, but in reality looking to advertise

Here, I find myself unable to distinguish.  Other opinions?

Title: Re: I dun goofed
Post by: StockBeard on November 26, 2014, 09:49:57 PM
Quote from: danclarkie on April 11, 2014, 12:44:17 PM
I was sold the EXACT same product.
[...]
Take a look at this caluclations sheet that I made for the Royal London 360 product: https://docs.google.com/spreadsheet/ccc?key=0AlZ4DevKDH_AdDdLQlozM1JKa3V4Wl9Yei11VkxLTUE&usp=drive_web#gid=0

Danclarkie, your spreadsheet is extremely useful. I myself have been a client of RL360 for 28 months now, and just sent the paperwork to cancel the policy.
 
Some questions about your spreadsheet though:
- Your spreadsheet only goes up to 25 years. My RL360 plan was 30 years.
- Why do you care about Isle of Man's inflation? Shouldn't you be putting in there the inflation of the country you live in? At the end of the day, it's what will matter for your lifestyle, so not sure why you put the Isle Of Man there. For example, I live in Japan, and inflation is more or less 0 here, meaning any investment with some sort of interest can beat it. [Update: I figured it out. this is because the policy specifies that the fixed monthly fees for the contract will go up according to IoM inflation]
- In your example, your Financial advisor's commission fee is 4.92%. In my case, this was 0.5%. Did you get scammed even more than me, or am I not looking at the right numbers? [Update: I was not looking at the right numbers. It seems in some cases the financial advisor is getting a "lump sum". In my case, the 0.5% is an annual rate, that is added to the other fees. It's actually a worse scenario in the long term, it just literally adds 0.5% to the already terribly high average. I had to modify the spreadsheet accordingly]
- In your example, your actual growth rate was -2.9%. Wow, what happened here? If I play with my current values, I think so far my growth rate was about 10% over the past 2 years and a half. I'm not saying it would stay that high forever, but at that level my advisor is actually beating the market...

On a related note: many people who are in this scheme are asking themselves if it is worth cancelling everything and taking the loss now (the answer is yes in all scenarios I've tried), or keep investing in that plan. It is easy to extend Dan's spreadsheet to estimate this.
The idea is that you compare starting the "alternate" plan from scratch, while your RL360 policy is already fairly advanced.
Add a new column "V". It starts at "whatever money you got back (that's the surrender value, or column Q in Dan's spreadsheet)" on the month of your cancellation. In my case, I am cancelling on the 28th month of my policy, so I'll write
in V28:  =Q27
in V29: =((V28+$B$8)*$B$41)*$B$47
(that's (value so far [V28] + monthly premium [B8]) multiplied by growth rate, multiplied by calculated inverse fee)
Then drag V29 to the bottom so that the same logic applies to V30, etc...

You can be conservative and have your first value be "0", if you assume you won't see any money back (if you're in your first 2 years, or if you think RL360 will never send you the money back)
You can create a column W, that will contain V - Q, and then you'll easily see when it reaches a positive amount.

From there you can play with the Growth rate to see how it impacts the result. Basically a high growth rate of the market overall will relatively make the RL360 fees appear smaller, meaning it will take more time to catch up with the alternate plan in a "good" market. On the other hand, if the market tanks, the fees of RL360 will be relatively much bigger.

All of the above (and Dan's spreadsheet) assumes that your RL360 advisor cannot beat the market in the long run (a very safe assumption). Although in my case they have been significantly above the market for the past 2 years, as it's been stated several times, it is safe to assume that over the course of 15, 25 (or, in my case, 30) years, they will be very close to the market returns. As such, it is safe to assume you can find a better plan with lower fees, that will have the same growth rate.

In my example, I have found that it will take me from 2 to 6 years (depending on growth rate) to get back to a level where my alternate plan will beat "staying with RL360". Keep in mind that I am retiring from the plan on month 28, so I am losing everything from the first 24 months. Depending on how you look at it I am losing somewhere from 80% to 90% of my investment, yet it will take only a few years to beat RL360.

All of this depends on all the fees, what your "other plan" is (in my case, an ETF from Schwab with a fee lower than 0.1%), how long you were scheduled to be in the RL360 thing, etc... So, it's difficult for anyone to help you in your specific scenario, but I found that even tweaking all the variables (growth rate, fees for your other plan, etc...) to exaggerated values, it is still better to get out of the RL360 scheme and invest in another location.
On the same line of thoughts don't fall for their "tax" argument. I can't think of a world where my tax on investment benefits + my alternate plan would end up costing me more than the atrocious fees this plan ends up being. And that's assuming I end up paying 0 taxes on their stuff, which, I have already confirmed, is not going to happen.

Again: take the 30 minutes it takes to understand Dan's spreadsheet, and start playing with the numbers, your own plan, etc. It's enlightening.

After playing with it a bit, I concluded that it is safe to get out of RL360 as soon as you possibly can, independently of how much you've invested in it, and how long you've been with them. Independently of where you live, there *HAS* to be a better option out there.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 26, 2014, 10:17:57 PM
Spoke with the advisor over lunch, so here is where things stand.

- Question about the commission wasn't answered in a way that made sense. He mentioned "everyone gets commissions in this industry". Don't have the data to prove him wrong but I don't feel like he addressed my concerns.
- I felt a little pressured to do things. He asked whether I was ready to move forward straight away
- He mentioned this forum was just a place for cheapskates who would rather jump through a ring of fire than pay fees for something worth it. Probably the final icing on the cake.

Said goodbye then sent an email that I am not interested after we had parted ways.

I am still looking for other automated options in Japan if anyone has them.
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on November 26, 2014, 11:29:50 PM
Quote from: timjp on November 26, 2014, 10:17:57 PM
Said goodbye then sent an email that I am not interested after we had parted ways.
timjp, well done!  It's not easy to resist the high pressure sales tactics.  Best wishes for finding a good alternative.
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on November 26, 2014, 11:36:58 PM
Quote from: MDM on November 26, 2014, 09:34:26 PM
There is an interesting but little known version of the Turing test.  In this version, one tries to distinguish between
  > an unwary investor seeking support for his hope that something seeming too good to be true, really is true - despite repeated contrary cautions
  > an agent of a financial firm trying to lure unwary investors by pretending to ask questions, but in reality looking to advertise

Here, I find myself unable to distinguish.  Other opinions?

:-) I was thinking the same thing, but apart from the fact that it's hard to prove, does it actually matter? Our combined response remains the same.

Furthermore, if you go back to my posts on the first page you'll see I seem almost evangelistic in my writeup. So I daresay there is one more possibility:

  > an unwary investor seeking support for his hope that something seeming too good to be true, really is true as he has already taken the plunge and doesn't want to face the fact that he/she may have been extremely wrong.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on November 26, 2014, 11:37:15 PM
timjp, thanks for coming back to report :)
Care to name the company who tried to sell you this bad product?
In my case this was Select Asset Management in Tokyo (and some of their former employees have moved to a company named Tyton Capital, selling the same products)

This is very simple: either they truly believe the product is good, in which case they are bad at their jobs (because they should point you to low fee ETFs which are largely superior products), or they don't, in which case they are scamming you to get the commission. Again, as I posted above, if you run the numbers in Dan's spreadsheet, it becomes extremely clear. YES, in the long run, RL360 makes money. But NO, this is not a good product. The fees are extremely high, and although the end result is better than having the money sitting in a JP savings account, the lock and duration of the plan make it very bad: if anything changes in your life goals (which *will* happen in the course of 20 years) then you are screwed

I am in Japan but am lucky to have a brokerage account in the US thanks to my company (I'm a specific case and I don't think a "random" person in Japan can have such an account. They actually told me once that they would have closed it if I hadn't been one of their clients for so long). Wiring money to this account, however, is very tough... I have some income directly from the US so that hasn't been a problem so far, but now that I'll have my monthly premium on RL360 cancelled, I'm on the same boat as you, not sure where to put it. But even if it takes months, years to figure it out, the end result will still be better than what RL360 can yield. That's how bad this product is (again, don't take my word for it, do the math with the help of the spreadsheet shared by Dan)

Some people in this thread mentioned that Shinsei lets you invest on the stock market through some other company? Also my wife has an account on SBI, which supposedly lets her invest on the stock market, but she never made the move so I don't know how flexible this is and if it allows investing on non JP markets.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on November 26, 2014, 11:43:20 PM
Different company, but I'm not bold enough to mention names. Don't want to face any angry calls / legal problems as I didn't choose my username as anonymously as I should've.
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 27, 2014, 12:52:27 AM
Quote from: wololo on November 26, 2014, 11:37:15 PM
Some people in this thread mentioned that Shinsei lets you invest on the stock market through some other company? Also my wife has an account on SBI, which supposedly lets her invest on the stock market, but she never made the move so I don't know how flexible this is and if it allows investing on non JP markets.

I had this set up some years ago. Shinsei allowed setting up a connection to a Rakuten Shouken account, and you could transfer funds there and back and place orders via their online banking interface. It worked, but was somewhat clunky. At the time I was looking at possibilities for trading individual Japanese stocks, but lost interest when I found that the high lot number and stock prices made it unworkable for most small investors. (I.e. most trades would have to be for a million yen or more, which was too rich for my blood.)

Rakuten may now include index funds, maybe even the ETF versions of the Vanguard funds. I haven't kept up on it because I believe they don't allow purchases of US-based products by US citizens, like many financial companies here do. But for a non-US citizen, it might be worth looking in to.
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 27, 2014, 12:55:58 AM
Quote from: MDM on November 26, 2014, 11:29:50 PM
Quote from: timjp on November 26, 2014, 10:17:57 PM
Said goodbye then sent an email that I am not interested after we had parted ways.
timjp, well done!  It's not easy to resist the high pressure sales tactics.  Best wishes for finding a good alternative.

Indeed, well done timjp! I think you'll find a much better way to invest, although there will be more hoops to jump through.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on November 27, 2014, 07:53:17 PM
For those living in Japan, this seems to be a good resource, since there were questions about "where to invest, if not in one of these offshore ILAs?":
http://www.bogleheads.org/wiki/Investing_in_Japan

It confirms that my brokerage account at Schwab is now not a possibility anymore (I hope I'll keep mine as long as possible), but gives a few possibilities. The real problem seems to be for US citizens living in Japan, as a lot of restrictions apparently apply to them.

It seems Japan/US are putting honest people in a situation like I ended up with, investing in shady things such as RL360, because all other legal options are either super convoluted, or not available to expats, or with very poor return on investment. Once again, an additional attempt at regulating things impacts the honest guy more than the bad people this is supposed to target...
Nevertheless that link above should be giving a few leads to people in a similar situation, in Japan.
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on November 27, 2014, 10:08:33 PM
wololo, that's a good starting point.

Maybe we should include any further talk about how and where we SHOULD invest while in Japan in the other thread, "Please help me invest my truckload of yen"?
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on November 28, 2014, 11:31:40 AM
Wow, my numbers are actually even worse than I thought.
If you see above, I asked Dan why his "commission fee" for the advisor was "4.92%", while mine is 0.5%. I saw my commission fee is actually taken *monthly* throughout the entire period of the contract. In Dan's case, it is a "one off" payment, a huge lump sum. In my case, they charge through the entire life of the product. On one hand, it means they have more incentive to help you with your investment through the lifetime of the product. On the other hand, it ends up costing way much more, and it means they have even more incentive to keep you in the contract.

Specifically, the contract says:
I authorise RL360 to take a withdrawal from my policy in line with the following:
A Percentage, 0.5% per year, taken quarterly as a percentage of my policy value. (the withdrawal should not be more than 1% per year)
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on November 29, 2014, 02:44:41 AM
So, I have sent my cancellation papers. RL360 contacted my advisor, and he instantly contacted me back to try and make me stay with the plan.
He mentioned the following things:
1) A big "loyalty" bonus at the end of the contract term (in my case, 7.5% of the fund total added after year 30)
2) Tax deferred benefits of RL360 (I understand it as: you can declare your premiums as a "life insurance" investment and deduct those from your taxable income. They will be taxed in the future as you withdraw from the policy That understanding was incorrect. What they mean is that RL360 has the same benefits as an ETF: you pay taxes only when selling/withdrawing. As such, there is no tax benefit from RL360 compared to an ETF portfolio)
3) what he calls opportunity benefits (the possibility that his company will beat the market)

I ran additional math to look at it
1) The loyalty bonus basically covers the fees of the last 4 to 5 years. It looks like a big difference but doesn't make too much impact in the big scheme

2) [Edit: I had a big explanation here based on an incorrect understanding. Bottom line, RL360 does not have any more tax benefits than an ETF portfolio does. They are both in situations where you are taxed when you sell/withdraw rather than on a yearly/witholding basis]

3) Pretending they can beat the market for 30 years is statistically unrealistic

conclusion: The loyalty bonus needs to be added to Dan's Spreadsheet, but does not make a significant difference
Title: Re: Royal London 360 - I dun goofed
Post by: richo on November 30, 2014, 09:45:56 PM
Wololo, have a look at the spreadsheet I linked to in my previous post in this thread. The main reason I initially made it was to take into consideration the impact of the 'loyalty' bonus as my adviser argued Dan's sheet didn't take this into account and the account was much than Dan's spreadsheet showed. Of course my adviser was wrong - it was still crap when I took this into account!

Congrats anyway I cutting your losses and running.  Once you turn off the cold shower and get out of the fetal position you realize the future is lot brighter being in charge of your own financial destiny.



 
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on November 30, 2014, 11:57:02 PM
Thanks Richo, I looked at your spreadsheet too, but for some reason I was not able to have the numbers trigger any change. I did not look too deep into it though as I had already invested lots of time on Dan's spreadsheet.

Yoohoo, introducing yet a new tool to compute your RL360 fees!

Eventually I am not so good with excel and the like, so I ended up writing my own tool to do the math. I'll link it here, mods feel free to remove the link if that is against the rules:
http://howtoretireearly.net/ilas.php

Hopefully it is easy enough to understand. Fill in the numbers and look at the results.

That thing is based mostly on Dan's spreadsheet, with the following modifications:
- Dan's calculation of the initial unit charge is wrong, if I understand correctly. In his model, the number stays constant after the initial allocation period. Actually, given how the initial unit charge is taken (from the initial units themselves) and how the initial unit value keeps growing with time, this number varies with time.
- More generally, the fees are sometimes taken from all units, sometimes from accumulation units (e.g. adviser fee), sometimes from the initial units (e.g. unit charge). The difference ends up not being too significant, but we might as well get the math right if we are to make the decision.
- RL360 have a new fee structure compared to what people have discussed here. The adviser fee is a yearly fee (typically 0.5% to 1%) that the advisers start getting after the initial allocation period. In other words, in theory, this gives them an incentive to manage the fund correctly throughout its entire life. This is different from the "lump sum commission" that apparently some people have ended up paying to their adviser
- I take into account the final bonus

I also added a "how long have you been in the policy?" entry. This computes a "leave the ship now!" scenario, that tells people if they should leave the policy and take the surrender loss. I think this is very useful.

Please give the tool (http://howtoretireearly.net/ilas.php) a try if you are in the same situation as I was a few days ago: stuck with RL360 and not knowing if it is worth leaving it now. Feedback welcome, I'm also willing to correct issues if some experts find any :)

One technical detail: the form uses "GET" parameters: this way you can share the resulting url to show your results to others.

(Note: I have found that my tool ends up with an RL360 surrender value that is 2.5% lower than my adviser's simulation for the same values in a 30 year term. This translates into a 0.1% cost difference yearly. You can offset that by reducing the adviser fee by 0.1% in the input. This gives RL360 a "best case scenario" kind of approach. I am confident that even by doing that, your alternate plan will look better)

Tax discussions
My adviser has insisted that I wasn't doing the math correctly, talking about some tax benefits of RL360 (what he calls gross rollup). After digging and asking for more explanation, I understand that what he means is that rebalancing an ETF portfolio (Bond/Stock for example) has a tax cost. He says the same cost does not apply when rebalancing the RL360 portfolio. The only conclusion I drew from this, is that you have to be careful to include these rebalancing costs in your alternate platform. In my case, I found that the fees I have to pay in my ETF are: management fees + bid-ask spread costs + rebalancing tax costs + dividend tax cost. Needless to say, this plan is still much cheaper than RL360, but it is important to give RL360 a fair comparison.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 01, 2014, 01:21:20 AM
Thanks for making that site! It was interesting to compare what I received.

The tax thing is something I never really understood either...what's gross roll-up?
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on December 01, 2014, 02:08:07 AM
Quote from: timjp on December 01, 2014, 01:21:20 AM
Thanks for making that site! It was interesting to compare what I received.
I would love if you can confirm that the values your advisers gave you roughly match what my tool gives you?

Quote
The tax thing is something I never really understood either...what's gross roll-up?
(Disclaimer! Not a professional finance guy here, if you haven't noticed yet)
My understanding, based on what the guy discussed with me:
when you rebalance a portfolio (something that happens roughly every year... but there are many strategies), you need to sell some of your investment to buy some other stuff. For example if you plan to have 50/50 Bond/Stock, but your stock outperforms the bond, and you end up with 40/60, then at the end of the year you need to sell some stock and buy some bonds, in order to get back to your ideal risk/return rate of 50% bond, 50% stock.
When you sell your stock, you make a profit. That profit is taxed, either with tax withholding, or at the end of the year. The tax is money you will not be able to invest. Over the period of 30 years, this can have significant consequences on the final value of your stash.
What the guy told me is that when they do this necessary rebalancing thing in RL360, there is no tax involved, meaning you don't "lose" anything by rebalancing. The tax is deferred to when you will actually withdraw money from the fund, 30 years later. In the meantime, the money has been used to grow your fund. That benefit is what they call "gross roll up".
Again, the benefits of that are dubious given the high fees of their plan anyway. The only thing is, you have to include the "cost of managing your stock" in your "alternate platform" fee. It's not only the fee charged by your brokerage account, but also the tax you pay when rebalancing, etc...
This here seems to confirm my understanding: http://tax-planner.blogspot.com/2012/02/gross-roll-up-to-defer-tax.html
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on December 01, 2014, 06:22:31 AM
Wow that tool is amazing. Hopefully it helps a few people make the same (hard) decisions. I'll be linking to it any chance I get, all over the web.

Seriously, fuck Royal London (http://forum.mrmoneymustache.com/investor-alley/i-dun-goofed/) and fuck anyone selling their products.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 01, 2014, 08:03:13 PM
Projections were about the same. Your one was a little higher by 20,000 or so. So there might be some errors in there.

Anyone has some experience on how much rebalancing and taxes affects an ETF portfolios returns. I.E. Bid offer spread, div taxes, rebalancing tax costs?
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on December 02, 2014, 03:57:36 PM
timjp - There's a lot of info here: http://bit.ly/1CCWXne

Otherwise you might like to try searching these forums, or asking in the Investment section as this question isn't specific to Royal London 360 Quantum.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 02, 2014, 05:40:46 PM
Thanks for the link (ok I did google this before asking but everything I am finding is for locals and not expats), I thought that this discussion is where expats go someone might already have experience. Plus if we could destroy the gross rollup myth this would be the final nail on the coffin.

What I am finding is capital gains, depending on the country is between 20-30% and dividends tax goes from free to 20% or goes into income tax.

How many times do people rebalance their portfolio / change brokerages? If you have to move overseas or have an account that pays your taxes for you, this would cut into the compound interest right?

I feel like this isn't so much of an issue when we're talking about less than 50,000 in capital gains, but from what the spreadsheets are showing me for alternatives the return of an alternative platform should be a minus the tax percentage right?
Edit: RL360s final total should also be lower by that amount as well since tax affects the final total.
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on December 02, 2014, 06:55:20 PM
Good point. First step is to check with your local Tax Office how the product would be taxed over its life and also on withdrawal. Second step is to take a gamble as to whether you think the tax law could change at all in the next 25 years of the plan.

To be honest, IRA/superannuation/etc has a similar gamble. But it's much more politically feasible for a government to "clamp down on tax cheats" than it is to squeeze the local saver. This was one of the concerns I had with the program.

Also detection methods as well as regulation are getting more strict, not less. Isle of Man has already signed on to FATCA this year. The cowboys selling Royal London's Quantum 360 etc make it clear that they don't get involved with tax issues, so do your homework.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on December 03, 2014, 02:26:21 AM
Quote from: timjp on December 02, 2014, 05:40:46 PM
Plus if we could destroy the gross rollup myth this would be the final nail on the coffin.
It's not really a myth, it's just that rebalancing your portfolio shouldn't cost "that much" that it would offset the RL360 fees.

I did the math on my own for my specific case. Basically, if you assume a 50/50 Stock/Bond portfolio, with average historical growth of G1 and G2 respectively, it's reasonably easy to compute, on average, what percentage of your stock (assuming stock grew faster) you have to sell every year to rebalance. Based on that percentage and G1, it is easy to compute how much tax will be taken as a percentage of the total fund.
Benefit B gained from the stock is value of the stock at the end of the year S, multiplied by G1/(1+G1).
B = S * G1 / (1+G1)
G1 / (1+G1) is the growth from the perspective of the "end of the year". In other words, B is G1/(1+G1) as a percent of S

Amount of stock to sell (in percent of S) is (G1 - G2)/2 * 1/(1+G1) = (G1-G2)/(2(1+G1)) . I can't remember exactly how I found this value
So, what gets taxed when you rebalance, in percent, is total benefit B multiplied by percentage of stock you actually have to sell. This means G1(1+G1) multiplied by (G1-G2)((2(1+G1).

in one of my example, the stock fund would grow 16.84% yearly on average (G1), and the Bond would grow 3.22% on average(G2).
G1/(1+G1) = 14.41%
G1-G2/(2(1+G1) = 6.81/(1+G1) = 5.83%
14.41% * 5.83% = 0.84% of Stock gets taxed.
Since stock is more or less half of your total fund (the other half is bonds), about 0.42% (0.84/2) of the fund gets taxed when you rebalance. My tax rate is roughly 25%, so I end up with about 0.1% of the fund yearly used for taxes during rebalancing (assuming you rebalance once a year. Some people do it less often) . Only thing remaining for me is to add this 0.1% to the yearly fee of my "alternate platform" in my computation. For good measure, in my tests, I multiplied this by 2 just in case.
It's also a "worst case scenario" that assumes you are not investing anymore. If you are still investing in the fund, theoretically you are doing it "cleverly" by buying the portion that is "lagging" (either bonds, or stock in my example). This lets you rebalance naturaly (to some extent) without having to sell, reducing the amount of rebalancing at the end of the year (and therefore reducnig taxes)

That's math done on the coin of a table while doing other stuff, and I just learned about these things 3 days ago, I just quickly checked it seemed to add up for me with an imaginary scenario. So Don't quote me on this!


Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 03, 2014, 04:28:12 AM
Ok. From all the financial advisor talk I don't know what's legit and what's not.
That's more complicated then I expected, I probably should do the math to understand it.

Alright, so on top of that you're paying capital gains on your funds, in your American brokerage and then paying taxes again when you take the money when you want it, assuming another country.

I am drawing the negative conclusion it's either pay the government or companies like RL360...

What I was told about RL360 was withdrawals are income and shutting down the policy is capital gains.
Title: Re: Royal London 360 - I dun goofed
Post by: PeanutUtd on December 03, 2014, 04:28:54 AM

Quote from: timjp on November 26, 2014, 10:17:57 PM
Spoke with the advisor over lunch, so here is where things stand.

- Question about the commission wasn't answered in a way that made sense. He mentioned "everyone gets commissions in this industry". Don't have the data to prove him wrong but I don't feel like he addressed my concerns.
- I felt a little pressured to do things. He asked whether I was ready to move forward straight away
- He mentioned this forum was just a place for cheapskates who would rather jump through a ring of fire than pay fees for something worth it. Probably the final icing on the cake.

Said goodbye then sent an email that I am not interested after we had parted ways.

I am still looking for other automated options in Japan if anyone has them.

Not automated but I have been using ozforex to transfer from Singapore as interesting investment options are pretty limited here - plus we don't plan to stay here long term.

They seem to transfer from Japan and I've have found it extremely user friendly. They do have a Singapore $ account though, so that makes it easier. Not sure how Japan works. I haven't checked how the conversion rates compare in a while.

http://www.ozforex.com.au/why-us/delivery-of-funds

If you plan to return to Australia in the future, could be worth investigating investment options there. Check out the Australian Investing thread. Some good ideas.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on December 03, 2014, 05:29:28 AM
Quote from: timjp on December 03, 2014, 04:28:12 AM
Alright, so on top of that you're paying capital gains on your funds, in your American brokerage.
This is what my "advisor" (quotes because I don't trust a guy who sold me RL360 to be truly honest about it) told me as well.
But I don't see it anywhere in my ETF statements (except for dividends. I took that into account in my yearly fees), unless he is talking about rebalancing, but I already computed that and am not worried. My advisor told me: oh, so you expect your portfolio to never have to be rebalanced? And, bottom line is with a simple portfolio of 2 or 3 ETFS, rebalancing is not that expensive. In other words, he failed to explain to me how and when that tax was taken, he got frustrated and me too, we stopped it there.

Here are the costs I found for my ETF:
- fees when buying new shares (0 in my case)
- capital gain tax on dividends (easy to estimate as a yearly % of the fund)
- management fees (yearly % of fund by definition)
- rebalancing tax costs (I showed you my calculations above)
- ask-bid spread (not sure how to factor that in my expenses, help appreciated)
- tracking error (ditto)

Then of course, when I sell/take the money, capital gain taxes in Japan (same as when doing rebalancing). But it would be the same in my situation when withdrawing from rl360 so I don't take those into account.
If you find more details I am interested too.
 
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 03, 2014, 07:48:26 AM
I took dungoofed's advice and googled it.

http://international.schwab.com/public/international/pricing_services/us_tax

http://perspective.schwab.com/mobile/article/7504/ETFs-and-Taxes-What-You-Need-to-Know

From what it says, is that they'll withhold the US income and paying it straight to the IRS, and judging by those tax rates, things are quite different it seems.

My guess is since you have a smaller amount (20,000-50,000) in there so there are less taxes paid?
Have you had the account for a few years?
Sounds like the guy at least knows his counter arguments...

About Aus options, not sure which is going to be long term, Japan could be an option, so could Aus and somewhere else. I just am not sure I'll decide that until kids happen.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on December 03, 2014, 04:44:45 PM
I've had the account for years. I don't see in there anything that indicates my findings are wrong. As I said, dividends are indeed "double dipped" in my case, but these taxes represent a small amount (in my case 0.2% yearly), that I integrated in my costs.

Let me quote what the links you sent says:

Schwab foreign clients typically pay no U.S. capital gains on U.S. securities trades. And their dividends from non-U.S. (offshore) sources.

Schwab foreign investors who are non-U.S residents and are a resident of a tax treaty country with a valid Form W-8BEN on file can receive tax rates on interest and dividend income from U.S. securities investments often at lower rates than U.S. residents. Other foreign investors generally pay a flat 30% withholding tax on interest and dividend income from U.S. securities investments.

Dividends and interest are taxed in the US (in my case at 10%).
Trades (selling) is not taxed by the US. The benefit is taxed, however, by the country you live in. Just like withdrawing money from RL360 would be taxed.

There's a possibility that I am being double-dipped on dividends: paying 10% to the US, then 25% again to Japan. I'd have to check if I can get a discount from Japan for those, it is a possibility. But again, dividends represent a small share of my ETF and the Schwab withholding is already taken into account in my math (and yet the ETF is still way better than RL360), so I am not concerned

I am not seeing anything in schwab's documentation that makes me believe I forgot a huge chunk. I have already sold some of my ETF and never got taxed (by the US) for it. However, of course, I had to declare the capital gain (and pay taxes) to Japan.
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 03, 2014, 07:34:12 PM
Alright. Looks good then, the PDF says stock issued on US securities and registered mutual funds is a 30% tax withholding, so the percentage of the your returns that are dividends is reduced by 30%, so a 10% (not that this would happen with etfs right?)gain in dividends would really be 7% right?

The only other risk is if the tax rules for foreign investors change in US. I guess same risk for the Isle of Man r.e. foreign investors, but I feel like their economy is built around being offshore so there would be a big fight for changing internal tax laws in the isle.

Looks like, apart from if an ETF closes / is rebranded it could be a shock, but Schwab looks good if only they took JP investors.

Do any other cheap US brokerages take JP investors?
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on December 03, 2014, 09:10:35 PM
Quote from: timjp on December 03, 2014, 07:34:12 PM
Alright. Looks good then, the PDF says stock issued on US securities and registered mutual funds is a 30% tax withholding, so the percentage of the your returns that are dividends is reduced by 30%, so a 10% (not that this would happen with etfs right?)gain in dividends would really be 7% right?
In reality it's actually much smaller than that:
Japan has an agreement with the US, the US witholding on dividends for Japan residents is 10%, not 30%.
Additionally, my ETF's dividends represent less than 2% of the total fund yearly. Of course this can vary for each ETF, but in the "real life" example of my account, we are talking of 10% * 2% = 0.2% yearly. Someone not in Japan using the same ETF would be 30% * 2% = 0.6% yearly.

I think Schwab was the only US broker that accepted people in Japan, but they stopped doing so several years ago. go to bogleheads.org for some discussions on the subject. Other people have mentioned that you could try and convince Schwab to take you anyway, under some conditions they might accept (in particular if you have lots of money... duh...). If not, the other option is brokers that have been mentioned before: SBI, etc... I don't know precisely about the fees and tax implications of going through these guys
Title: Re: Royal London 360 - I dun goofed
Post by: timjp on December 03, 2014, 09:49:20 PM
From what it seems it's a similar tax situation from my experience with their application forms over the last week. They withhold capital cains, dividens etc or I have to file my taxes seperately. Gross rollup isn't an option like with an American account. I'll have to close the account if I leave Japan too, if I get a better offer overseas, otherwise I'll more than likely pay tax twice...

This thread has been a little eye opening, didn't realise options from Japan where as bleak as they are.
Title: Re: Royal London 360 - I dun goofed
Post by: 1984@au on January 10, 2015, 03:52:22 AM
I can't believe I got sucked into this. I hope they cancel my account soon.
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on January 11, 2015, 11:57:05 PM
I'm sorry to hear, and I hope the damage isn't too devastating.

People have been encouraging to me, in this thread, via PM and also in my own Journal thread here:

http://forum.mrmoneymustache.com/journals/rising-from-the-ashes-dungoofed%27s-journal-%28japanaustralia%29/

The best advice I can give is to keep your eye on the goal, and to use this as an opportunity to educate yourself, and remember that if you do these things then it'll have been a cheap lesson when the dust settles.
Title: Re: Royal London 360 - I dun goofed
Post by: Captainblunder on February 09, 2015, 10:04:08 AM
Hi Dun Goofed. I just signed up to this website with the express purpose of saying thank you for posting your experiences here! I have had a visit from an IFA (alleged!) who tried to sell me this product. I was concerned about the fees generally so did some Internet digging and came across this warning. Suffice to say I will not be investing and will be opening up a tracker fund to start my investing before moving into some shares (eventually...).

As to being behind don't sweat it. By thinking of this stuff and saving now you are actually ahead of the majority (including me!).

Happy investing and looking forward to what else I can lesrn from these boards!
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on February 09, 2015, 10:35:15 PM
You're welcome, and I appreciate you registering. I really enjoy hearing that we're reaching people with this thread.
Title: Re: Royal London 360 - I dun goofed
Post by: ResearchFTW on April 16, 2015, 01:25:26 AM
Hi DunGoofed,

I'm another who has signed up solely to thank you for your posts and spreading awareness about these 'products'!

I recently moved to Dubai and only a few days ago had a meeting with an investment manager from PIC, part of DeVere group, who was about to sign me up on a Zurich International plan..

Suffice to say, having done some digging around I will be running a mile from any of these slimy f#&%s!

It seems my best option is to create my own brokerage account online and choose some low-risk ETF's. I'm from Ireland, so now I just need to figure out who to sign up with, what ETF's to invest in, and find out the tax implications are etc. If you have any thoughts on this feel free to share =)

Thanks again!
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on April 16, 2015, 06:55:27 AM
Hi mate no worries & thanks. 

I'm hopeful that these scammy plans will die a swift death now that information is out there. My buddy can't give his wife another child because he has to keep up payments into one of these plans. It's absolutely tragic.

Edit: jump into the forums with your questions. The guys here are knowledgable, no scammers.
Title: Re: Royal London 360 - I dun goofed
Post by: ResearchFTW on April 19, 2015, 05:16:23 AM
Sorry, I'm only after seeing your reply now. I've since read Andrew Hallam's Expat Investing guide so I'm a bit more knowledgeable :-)

I totally agree, and the sooner the better! I know a couple of people through my wife who are actually signed up to one of these plans already. They seem content with the quarterly charts/graphs the FA presents to them, but little to they know they're probably being fleeced!

That is truly tragic, very sad...

Thanks man, I'll check out the forum.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on May 11, 2015, 09:56:13 PM
The article I wrote on my blog (http://howtoretireearly.net/2014/11/30/the-rl360-scam-my-15000-investment-lesson/ ) about this plan is getting some attention: it's pretty much the only post on my blog that is getting any comments. Given how some people reply in there, I suspect some of them are affiliated with RL360.

I have yet to meet a person in real life who, facing the costs involved with the plan, can look at me and tell me "I don't see a problem here", besides the people who have sold me the insurance.
So tired of this BS, seriously. I guess it doesn't help that my blog post is not professionally written and this it is obvious I am not very well versed in the world of finance, so these people are now using the comments section to pretend the plan is actually good.

I'm reading random bullshit such as:
- Why does it matter how much they take from you as long as you meet your return goals?
(answer: because it means a good ETF would net me roughly 2.5% more)

- You should take into account the bonuses, etc...
(answer: I did, that's what my tool does, interesting that you keep pretending it does not)

- you scammed yourself by leaving the plan early, you ended up paying the cancellation fee
(answer: staying longer in the plan *is* a worse thng to do, as you keep pouring money in a suboptimal investment for 25 years, resulting in an opportunity loss of hundreds of thousands of dollars, even with the lowest monthly RL360 charge)
 
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on May 11, 2015, 10:56:48 PM
LOL wow looks like they found you! haha

Staying in the plan was proven to be worse, dollar for dollar, than leaving. Plug the numbers into the spreadsheet and see for yourself. Unless they are claiming the fund managers have "edge" lol
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on February 02, 2016, 10:57:55 AM
For those interested in taking action, a petition exists against these ILAS schemes, it calls out Royal London 360 (RL360) in particular:

Quote
Beware

Generali, Friends Provident, Zurich International, Skandia, Royal London 360, Aviva - has a commission-hungry "financial adviser" ever tried to lure you into buying one of these insurance company's investment-linked plans? If you did, you are a victim of a legalized, corporate scam.

Stop offshore investment scams holding expatriates' money hostage: https://www.change.org/p/generali-royal-london-360-zurich-international-stop-offshore-investment-scams-holding-expatriates-money-hostage?recruiter=55431908&utm_campaign=signature_receipt&utm_medium=email&utm_source=share_petition




The Telegraph in the UK also recently calls out Royal London as one of the firms involved in a "multi-billion pound industry in which savers are regularly paying up to seven times more in investment charges and commissions than they would in Britain.":  Exposed: the rip-off investment 'advisers’ who cost British expats billions (http://www.telegraph.co.uk/finance/personalfinance/investing/11726158/Exposed-the-rip-off-investment-advisers-who-cost-British-expats-billions.html)
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on February 02, 2016, 02:17:17 PM
Would be nice if the change.org petition can get some momentum.

I guess a lot of people in these forums are thinking "it doesn't affect me, I've already got this investing thing worked out" but imagine if your friend's son gets pressured into one of these things while doing a year teaching English overseas. Or if someone you know has their retirement savings set back by years due to a simple mistake or oversight.

That's the problem with these plans, the way they lock you in. It's sunk cost fallacy at its best, and so even though you now know that it's extremely overpriced you can't get out and the payments each month hang over your head for thirty. long. fucking. years.

30 years of explanations to your wife for one indiscretion with a high-pressure-fast-talking sales person is a tougher sentence than even Bill Clinton endured (gasp!)

The only way out early is to take a massive loss, or die. And people seriously consider suicide as a way out of these plans.

This is wealth destruction on a massive scale. And the victims are just normal people. Royal London and the rest of them see these people as milk cows, unless you decide you want off the farm in which case they send you to the slaughter.

I implore anyone who is committed to the financial education of others to sign the petition at change.org and share it on social media/etc. I created an account for the specific purpose, this is the first change.org petition I have signed. That is how strongly I feel about this.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on February 02, 2016, 02:53:57 PM
Yup. What I've found after writing the article on my blog is that people are really happy to find honest resources about this. I have also found that these companies go to significant length to make sure negative reviews about their product get removed from the tubes.

But overall, once people are out of this mess, very few of them have the will to fight back, and as such it's difficult to make things happen. A person in Switzerland found my blog and opened a case with the Swiss consumer protection entity. I've contacted a few people from Switzerland who jumped off these plans, but the answer I usually get is "well, I got off, I don't want any more trouble", or "well honestly it really was my fault for blindly trusting the adviser". For the few who try to fight back, they find out that the only entity they can go against are their financial advisers, who are just one of the many heads of the hydra. Not even worth the fight.

I do hope more people sign that petition, but I think things such as the Telegraph article, and more generally educating people about these scams (and possibly how to report them locally?) is the best way moving forward.

On that note, Andrew Hallam's blog (http://andrewhallam.com/ ) has been recommended to me as he's been calling out Royal London, Friends Provident, Zurich International Life, and Generalli regularly for their bad investment products on his blog.
Title: Re: I dun goofed
Post by: Fuzz on March 07, 2016, 03:26:52 PM
Quote from: dungoofed on March 27, 2014, 04:01:55 PM
Hi - thanks for the replies so far. Whether you mean it or not it actually feels like you guys are willing to help me out here.

Ok so a couple of extra point to put things in perspective:

  • Working in the industry in which I work the number of investment options are limited.
So confused. What industry do you work in? Why can't you buy an ETF or Vanguard? I can't think of any industry where you can't buy stocks as a condition of being employed... Where are you working in Asia? If you work in financial services, there may be some limits, but that sounds well beyond anything I'm aware of. Just do whatever paperwork you need to do to open up a proper investment account.[/list]
Title: Re: Royal London 360 - I dun goofed
Post by: Heckler on March 07, 2016, 10:17:44 PM
This thread deserves some recognition for what it is.

http://www.mrmoneymustache.com/rl360-insurance/


Title: Re: Royal London 360 - I dun goofed
Post by: Malum Prohibitum on March 08, 2016, 12:08:37 PM
Quote from: Heckler on March 07, 2016, 10:17:44 PM
This thread deserves some recognition for what it is.

http://www.mrmoneymustache.com/rl360-insurance/

MMM,

If you are reading, I am not an AZ attorney (I'm licensed in GA), but there is no need to wait to get a copy of the complaint.  It is a public record, and therefore any member of the public is entitled to it.   Unfortunately, you cannot see it on the Maricopa County online docket, which just shows it exists and was filed Feb 12 https://www.superiorcourt.maricopa.gov/docket/CivilCourtCases/caseInfo.asp?caseNumber=CV2016-004485

But you can request a copy by mail.  Please see below.

To obtain copies of public records by mail, please address your request to:

Correspondence Section
Clerk of the Superior Court
201 West Jefferson Street
Phoenix, AZ 85003

Please include in your request:

The case number;
The names of the parties at the time the case was filed;
The specific documents you want to receive;
The filing date or year filed;
The number of pages of the document to be copied, if known;
Your day-time phone number and/or e-mail address so we may contact you if any questions.


I hope this helps, MMM.
Title: Re: Royal London 360 - I dun goofed
Post by: Malum Prohibitum on March 08, 2016, 12:17:25 PM
Also, just as an FYI, web site hosts of forums like this are legally protected from lawsuits based upon defamation by forum members pursuant to Section 230 of the Communications Decency Act.  Here is some info for you:

https://www.eff.org/issues/bloggers/legal/liability/230

Title: Re: Royal London 360 - I dun goofed
Post by: MDM on March 08, 2016, 01:58:49 PM
Quote from: Malum Prohibitum on March 08, 2016, 12:08:37 PM
MMM,

If you are reading....

MP, see http://forum.mrmoneymustache.com/ask-a-mustachian/arizona-attorney-needed-(to-help-this-forum!)/msg1005409/#msg1005409 - you might send your note to him via one of the methods suggested there.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 08, 2016, 02:02:42 PM
Quote from: Malum Prohibitum on March 08, 2016, 12:17:25 PM
Also, just as an FYI, web site hosts of forums like this are legally protected from lawsuits based upon defamation by forum members pursuant to Section 230 of the Communications Decency Act.  Here is some info for you:

https://www.eff.org/issues/bloggers/legal/liability/230
That's good to know, but I think MMM is not trying to protect himself, he's trying to protect his users (us). He's trying to prevent that company from getting access to our personal information. I am sure RL360's lawyers are well aware of Section 230, which is probably why they are asking for information about the people who posted on this thread. They might not intend to sue MMM himself, but those who have posted on this thread

 Those of us living outside of the US might be particularly at risk, given that RL360 could sue these people in the UK (where defamation law are strongly biased in favor of the plaintiff), and then have the judgement enforced on wherever the user lives (Europe in particular). US residents are protected by the SPEECH Act. Others are not.

Disclaimer if that wasn't obvious: I'm not a lawyer
Title: Re: Royal London 360 - I dun goofed
Post by: What da on March 15, 2016, 12:38:36 PM
Hi guys, first of all thank you for sharing all your info. As a worker in a market totally different from the financial one I find it very difficult to find "the right thing to do with my savings..". As a young expat trying to save for retirement I signed up with RL360 half a year ago.... When typing in RL360 to find the login page of my account I found this page and now I'm starting to worry... However I am also wondering if my scheme has slightly different conditions because my spreadsheet comes out a bit different (I think..). Here's an overview:

Policy Period: 20 years
Initial Allocation Period: 20 months
Initial Bonus: 4.5 x monthly premium

Monthly Premium Deposit Charge: -0.50%
Monthly Premium Deposit Bonus: +2.00%
(I guess this 0.50% charge is a 'motivator' to maintain the monthly investment above 650 or 1150 euro to maintain the premium bonus which offsets the deposit charge.)

Annual Policy Fee: 12 x 6 = 72 euros
Annual Contract Fee: -1.5% of policy value

End of Policy Bonus: +5% of policy value

NO Advisor fees/charges. Advisor mentioned RL360 pays him 0.5% of the annual contract fee. In other words its in his interest to keep the policy doing as good as possible.

When I put it all in my spreadsheet I got the following results after taking off all the costs/fees etc:
If over 20 years my policy averages 0% annual return I would loose 10% of my total deposits.
If over 20 years my policy averages 4% annual return I would gain 60% on my total deposits.
If over 20 years my policy averages 8% annual return I would gain 280% on my total deposits.

Now with my very limited knowledge of the financial markets this scheme seems like a better option than keeping my money in the bank. So when I did the math I thought this was quite a good plan instead of trying to purchase stocks etc myself online.

My questions to you guys are:
1. Are my policy conditions different from yours?
2. Am I interpreting the cost structures in an incorrect way (making me a wonderful target for these investment advisers...)
3. Are there other investment options with lower cost structures and a reasonable probability of 4-8% annual interest I perhaps should investigate?
 
Thank you all very much in advance for taking the time!
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 15, 2016, 12:46:44 PM
Quote from: What da on March 15, 2016, 12:38:36 PM
1. Are my policy conditions different from yours?
Nope, similar to mine, different numbers but basically the same

Quote
2. Am I interpreting the cost structures in an incorrect way (making me a wonderful target for these investment advisers...)
Kind of. With the contract fee + advisor fee alone, you pay them 2% of your total money every year. That's not counting all other potential fees such as the policy fee, etc... Compare that to my schwab account which on average costs me 0.05% nowadays, you're paying 40 times more than me for something that I consider to be the same service (would you pay $25'000 for an iPhone 6?).
Plug your numbers into my tool and see if it matches your calculation: http://howtoretireearly.net/ilas.php
 
Quote

3. Are there other investment options with lower cost structures and a reasonable probability of 4-8% annual interest I perhaps should investigate?
It depends where you live and your plans for life*, but you can certainly find something that will cost you less than 1% a year, pretty much everywhere. I recommend Andrew Hallam's book "guide to expatriates investing" which gives a few leads. People in the US use things such as Vanguard and Schwab (I have Schwab myself). I've seen"Interactive Brokers" being recommended a lot (for expatriates) but haven't tried their services. There are tax implications depending on where you live so you'll have to do your research, but my personal opinion is that you should not stay with an investment platform that takes more than 1% of your money annually, it will dramatically reduce your chances at financial independence.

Edit:
*are you an expat?
Do you plan to stay long term in the same country?
--> consider investing in a brokerage account in that specific country.
OR: Do you plan to go back to your home country?
--> consider investing in a brokerage account in your home country
OR: Will you move a lot/ don't know?
--> Check Andrew Hallam's book which recommends some brokers that take international customers. Interactive Brokers is one he recommends, he also recommends some companies, I believe in Singapour, Canada, ... that accept customers from all around the world. It depends a lot on your nationality and where you live, there is not a single good answer, but the answer definitely is *not* an investment platform that takes 2% or more of your money every year.

Also check boglehead's 3 fund portfolio ( https://www.bogleheads.org/wiki/Three-fund_portfolio ). It's mind opening how simple it is to invest on your own. My opinion (and my personal experience) is that you should leverage this experience to realize that you don't really need a financial advisor.
Title: Re: Royal London 360 - I dun goofed
Post by: What da on March 16, 2016, 02:02:46 PM
Thanks for your answer. Just to clarify I pay 1.5% per year. 1% goes to RL360, 0.5% goes to the advisor.

Also I forgot to mention the 0.50% deposit charge is only applicable to the Initial Allocation Period. After that there are no more charges but the 2% bonus on the monthly premium continues.

The advisor today confirmed there are no other charges. No fund manager fee's etc. So when I'm doing the math between my policy and for example yours where you only pay 0.5% annually ($3.000 monthly premiums, 4% annual return) the difference after 20 years is $55.000,- / 4.5% of the fund value. Sure its not nothing but I wonder if thats worth canceling a policy over. There is a quarterly meeting with my advisor and if I would have to investigate these funds myself I wonder how much time it would consume. I will definitely study the links that you send me, thank you very much for that.

I also have a Broker account with AvaTrade that I opened just for fun/learning experience at the moment. I did see you can also invest in ETF's (which a few posters previously mentioned is worth looking at). However it looks like with that broker you have to pay overnight charges when you enter long or short positions for an ETF. Appear to be between 2-3% which isn't cheap either... Perhaps thats only cause its leveraged trading and if I would invest thru my bank this might not be charged?

Anyway, to answer your questions (not sure how that nice looking quoting works so please bear with me):
Expat? Yes. Expat in a very warm, tax free country.

Future Plans? Planning to stay a while and no plans to go back home anymore. However I would not feel comfortable investing using a local account so thats why I was happy to use the RL360 offshore one.

Move a lot? Future moving totally depends on the job market so bit hard to answer that one.

Off to reading your links now!
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 16, 2016, 02:19:02 PM
Quote from: What da on March 16, 2016, 02:02:46 PM
So when I'm doing the math between my policy and for example yours where you only pay 0.5% annually ($3.000 monthly premiums, 4% annual return) the difference after 20 years is $55.000,- / 4.5% of the fund value. Sure its not nothing but I wonder if thats worth canceling a policy over.
Bottom line: you need to redo your math more carefully, as I believe you are misunderstanding lots of the fees. I calculate a difference of hundreds of thousands of dollars under acceptable market conditions (either 4% or 8% return), up to 50% of the fund value. At 4% return you might not even beat inflation. Details below.


Quote
Also I forgot to mention the 0.50% deposit charge is only applicable to the Initial Allocation Period.
I think you're misunderstanding the contract here. Can you confirm this for sure? In my case, the 0.5% deposit charge was applicable to the initial allocation *units*, not *period*. These units live through the entire life of your contract, meaning you still pay a fee on the money you invested in the first x months of the contract, for 20 years. This would be a huge difference with my contract (or my understanding of it) if you actually only pay for the first 20 months.

[Edit: the RL 360 website confirms what I thought: http://www.rl360.com/row/knowledge/quantum/quantuminitialunits.htm
It says (emphasis mine):
"There is a specific initial unit charge which applies throughout the premium payment term, but ONLY on initial units. The charge is 0.5% per month of the value of the initial units held."

My tool is correct. In your case you will end up paying a total of approximately $90'000 with that fee alone, for your first 20 months of investments. So, to be clear: you're paying $90'000 in fees for your $60'000 invested.
]

I am unaware of the Deposit Bonus, and my tool does not take that into account. This could offset some of the fees but to me this only helps to complexify the contract more, which is not a good thing.
[Edit: I can't find any mention of a "deposit bonus" in the rl360 Quantum documentation. Could you scan the part of your contracts that mentions it and how it works?]

With a 4% return yearly before fees, you are overly conservative. I think the market on average returns 7%. Just food for thoughts


Quote from: What da on March 16, 2016, 02:02:46 PM
you only pay 0.5% annually
Just to be clear, I personally pay 0.05% annually, not 0.5%.
At 1.5% you still pay 30 times what I do. The 0.5% for "alternate plan fee" I put in my php file is kind of a "worst case scenario" thing that takes dividend taxes into account (when I was in Japan I calculated that my actual cost on my taxable brokerage account was 0.25%: 0.2% in taxes and 0.05% in fund management fees).

Edit:
Quote from: What da on March 16, 2016, 02:02:46 PM
The advisor today confirmed there are no other charges. No fund manager fee's etc.
This directly contradicts the RL360 Quantum documentation, as it is on their site today (http://www.rl360.com/generic/downloads/rl360-quantum-terms-and-conditions.pdf ). Either your advisor chose specifically funds that charge no fee (hint: these don't exist, minimum fee is 0.04% and it goes up to 2.25%, see below), or he doesn't actually understand the fees (happens a lot more than you might think), or he is lying to you. I quote from the terms and conditions:

Quote
d) External fund management charge
The manager of each external Fund will deduct an annual  management charge. This will be allowed for within the  pricing of the individual Funds, at a rate determined by  the manager of each Fund. The charge will vary according  to the Fund chosen and further details can be obtained from the Policyholder’s Investment Adviser or the  Investment Guide, as is updated from time to time.

Of course your contract might be different, but this would be highly surprising.
Note that my tool also assumes no fund fees anyway (I should update it), so there's not much to be discussed here :)

Edit 2: From the official documentation (http://www.rl360.com/generic/downloads/rl360-quantum-investment-guide.pdf), the fund annual charges vary from 0.04% to 2.25%.

So, to summarize, you're paying:
- 1% to RL360
- 0.5% to your adviser
- 1% or more to the fund managers (there are only 20 funds out of hundreds that charge less than 1%, so I'm using 1% as a reasonable average here)
- The initial unit charge (close to $100'000 over 20 years)
- the policy fee (close to $2500 over 20 years).

You're at least paying 2.5% in fees annually.

The benefits you get:
- The premium incentive: $13'500 (the premium incentive is in initial units, meaning you pay the 0.5% fee on that). Note how this is dwarfed by the initial unit charge.
- The Deposit bonus (I haven't heard of that, you need to explain)
- The loyalty bonus: 5% of the policy value (basically offsets less than the last 2 years of fees)

Quote
However it looks like with that broker you have to pay overnight charges when you enter long or short positions for an ETF. Appear to be between 2-3% which isn't cheap either...
Make sure you are not confusing a "one time" fee with a yearly fee. If the broker is charging you 3% every time you buy some shares, it sucks, but in the long run it will be much, much less than a system that charges you 2.5% of your total wealth every single year.

One more data point:
From the official Documentation here: http://www.rl360adviser.com/generic/downloads/qu016.pdf
You would need a 1.38% growth rate annually to break even with a 20 years plan at $3000 premiums. That's without taking external fees into account (the fund fees). In other words, this means RL360 charge you approximately 1.38% annually once everything is said and done, bonuses etc... taken into account. (unclear if they count the advisor fee in here, they say 1.5% contract charge, you say you have 1% contract charge + 0.5% advisor fee. I recommend you double check your numbers. In my case I was paying 1.5% contract charge + 0.5% advisor fee. But let's assume their number includes the advisor fee)
add about 1% in fund fees (you can compute how much you actually pay by looking at the doc I linked to above, and weight each fee by the percentage of each fund in your portfolio) and you're at 2.38% in fees annually. 47 times what I pay. And that's from the official documentation, that's not me playing with the numbers here
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on March 17, 2016, 07:24:40 PM
Quote from: What da on March 16, 2016, 02:02:46 PM
Thanks for your answer. Just to clarify I pay 1.5% per year. 1% goes to RL360, 0.5% goes to the advisor.

Also I forgot to mention the 0.50% deposit charge is only applicable to the Initial Allocation Period. After that there are no more charges but the 2% bonus on the monthly premium continues.

The advisor today confirmed there are no other charges.

Hi What da. What were the exact words the salesperson used to say that you pay 1.5% per year, no other charges?
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on March 17, 2016, 07:51:31 PM
btw there are charges for being in the various mutual funds. If you have a look here:

http://www.rl360.com/generic/downloads/rl360-quantum-investment-guide.pdf

You can see the AMC and Performance fees. You don't "pay" these per se, but these fees are automatically taken off the value of the fund. So if you had 100 units of Janus US 20 at $1 each, if after one year the value of the underlying stocks had increased 1.25% the fund would still be 100 units worth $1 each; if you had have bought the underlying stocks they would be worth $101.25.

Vanguard ETFs have AMCs too but they are called "MER" and they are handled exactly the same way. To say that you don't "pay" them is disingenuous at best.

And the best part? According to an insider working at one of those funds, a percentage of that fee is returned to Royal London as a kickback for putting you in the fund (I haven't bothered to confirm whether that kickback is then redistributed to the salesperson, although people elsewhere on the net have mentioned it several times).
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 17, 2016, 08:22:38 PM
Quote from: dungoofed on March 17, 2016, 07:51:31 PM
Vanguard ETFs have AMCs too but they are called "MER" and they are handled exactly the same way. To say that you don't "pay" them is disingenuous at best.
Exactly. If we go by that logic, my Schwab ETFs cost me absolutely nothing since the only fee I'm charged is the "AMC", which for example is 0.03% for SCHB.
Title: Re: Royal London 360 - I dun goofed
Post by: What da on March 18, 2016, 11:15:49 PM
Hi Wololo & Dungoofed,

Yes you are right, I have discovered the 0.50% is being charged the entire contract. That is insane and it was not explained to me like that. It was also not explained to me that this charge is applied to the initial bonus. After adjusting my spreadsheet I do come to the same numbers you are mentioning. Big disappointment.

The deposit bonus I get is that they add 2% on each monthly premium. So I deposit $3000,- and they add $60.

Regarding the funds, my adviser told me that RL360 has arrangements with 300 different funds so that they do not pay any fee's when using them. He mentioned the particular funds that I am in do not have any fee's associated with them. He said there are other funds that can be chosen that do have fund management fee's..

My advisor did mention that if I would open an account with a broker and invest in similar funds myself I would have to pay a percentage on top of the initial deposit (around 4%) and that they would charge annual fund fee's which would come out roughly the same. Now from reading your posts this doesn't even remotely come close to how low your costs are with either Vanguard or Schwab...
Title: Re: Royal London 360 - I dun goofed
Post by: dungoofed on March 18, 2016, 11:50:29 PM
I'd still like to know how the adviser worded it.

"The effective fee over the course of the plan is 1.5%"

is assuming that you never take a "holiday" and continue to pay in the same amount every month for the duration of the plan. The moment you vary from the course your effective fee has increased.

The mark asks about fees, and they ask about holidays and reducing payments, and the two are answered separately. The mark feels as though he has done his due diligence.

--

Regarding the funds, again your adviser is telling the truth: if you were to walk in off the street you would have to pay a bunch of fees, things like a front-load fee. The trick in this case is that the forgone conclusion is that people actually buy these funds. They don't. Not when they see the math. They buy index tracking ETFs instead.
Title: Re: Royal London 360 - I dun goofed
Post by: stashgrower on March 19, 2016, 12:42:53 AM
Thankfully I've never been sold one of these products! I am only posting to applaud dungoofed and MMM posters on a high quality thread and helpful discussion. Dungoofed, I am sorry to hear of your loss. At least your courage is helping others avoid an expensive course of action.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 19, 2016, 01:49:25 PM
Quote from: What da on March 18, 2016, 11:15:49 PM
Regarding the funds, my adviser told me that RL360 has arrangements with 300 different funds so that they do not pay any fee's when using them. He mentioned the particular funds that I am in do not have any fee's associated with them. He said there are other funds that can be chosen that do have fund management fee's..
I still feel this part is extremely fishy. The official RL360 documentation (http://www.rl360.com/generic/downloads/rl360-quantum-investment-guide.pdf) mentions absolutely no fund with no fee. The vast majority of the funds has a fee of 1% or more, and the minimum I found is 0.04%. If they had such a thing as a "no fee" fund, don't you think they would mention it in their documentation or on their site?

(Keeping in mind that even if the fund's fee was 0, we're still taking of somewhere between 1.38% and 2% in fees for everything else, as described above)
Title: Re: Royal London 360 - I dun goofed
Post by: What da on March 19, 2016, 01:51:20 PM
Where would a non-American expat go to to purchase Index Tracking ETF's without having to pay these extra charges? And do these ETF's pay out dividend as well?
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 19, 2016, 02:08:37 PM
There's no easy answer for that, you need to be more precise and probably open a different thread: It depends on your nationality, where you live today, and your plans for life.

Locally: there must be a broker in your country that does not charge expensive fees to get ETFs. For example, In Japan, people tend to recommend Nomura, Rakuten, and SBI, but that would assume the expat living in Japan intends to stay in Japan for a very long term (they'd have to close the account when they leave the country).

your country of origin: You could also check in your country of origin. For example, I believe French expats are allowed to have an "assurance vie" (life insurance)  in France which is a low-cost wrapper around funds, including ETF's, and I think it is tax deferred.

If you plan to move a lot, you need an "offshore" platform:
I have already recommended to you Andrew Hallam's "guide to expatriate investing" above, which has many answers (see his site here: http://millionaireteacherbooks.com/global-expat/ , This is not an affiliate link, I bought the book on Amazon about 2 months ago and I recommend it to all expats). I have also mentioned Interactive Brokers to you (I do not have a contract with them, neither have I ever tried their services, but they are mentioned in Andrew's book), have you checked them? Andrew's guide also recommends a company named DBSVickers, I haven't tried them either.

Some ETF's pay dividends.

none of the above should be mistaken with financial advice. I'm basically you, roughly 2 years in the future. I do not have any finance degree neither do I claim I know what I'm talking about.

Edit:check schwab and vanguard too! I know they do not accept clients from Japan, but they might accept you.
Title: Re: Royal London 360 - I dun goofed
Post by: What da on March 19, 2016, 03:16:45 PM
Yes your correct, best not to clutter this topic too much. Did purchase the book you mentioned and will engage in an online chat with Schwab after the weekend. Vanguard 'says No' on their website.

Many thanks for all your advice!
Title: Re: Royal London 360 - I dun goofed
Post by: sendaiben on March 23, 2016, 12:24:10 AM
Quote from: timjp on November 24, 2014, 10:16:24 PM
Ok. So with that 1.5% what I am looking at, that's 1.59% growth necessary? (25 year 10000 usd pm)

For me the structured idea (retirement forget and ignore sort of thing) was the only reason I was considering it before seeing this thread, is anyone doing something better in Japan? Where should I be looking?

Hope it's okay to post this, but I run a website/community for residents of Japan. Two things you should look into are the J401k and NISA accounts -both provide tax-free investment options. More info at retirejapan.info

Post in our forum if you need more specific information :)
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on April 04, 2016, 08:04:21 PM
I dug some old promotional document I was shown by the advisor back in 2012 to convince me to join RL360.
Except for the blurred out parts, all of it is exactly as it was given to me. In particular, note how the "10% return" is highlighted with a green marker, as if it was the "realistic" target. This was done by the advisor.

The 10% return is after everything's been taken into account. The text mentions the contract charge (1.5%) pushing the 10% return to an actual 11.5% return, but does not mention the advisor fee (0.5%) or the fund fee (which we've established above is probably around 1%).
So we're talking of an average return of 13% per year for 30 years in order to reach the kind of numbers that were advertised to me. All the legal mumbo-jumbo is here of course, but is that an honest way of advertising a financial product? I'd be interested to know if anyone has ever had an average 13% return with RL360.

Title: Re: Royal London 360 - I dun goofed
Post by: One born every minute on April 25, 2016, 12:23:23 AM
 You know the term 'There's one born every minute', well I am that one. Not only do I have one of these RL360 Quantum policies, I also transferred my frozen (due to now being an expat) UK pensions into a qualifying recognised overseas pension scheme or QROPS for short.

 I only have a couple of payments left before the initial allocation period expires on the quantum policy. Using Wololo's calculator, it says I will have a 300,000 USD profit when the policy matures but I'm guessing that I got the figures wrong somehow. Also, as I'm now out of work and may be for a while, I'm going to have to take a holiday from paying which will make things even worse. So I guess I can say goodbye to the money I've paid so far.

 Regarding the pension, it shows a 40% loss on the last statement I received. This is what made me start searches on the net for Royal London and here I am.
Both the notes in the pension are showing unrealised losses and from what I read on the net, that doesn't seem good. My advisor says that there are barriers and the notes are within the barriers and they will pay out in the end and that I would only lose if I cashed in today but, I'm not sure if I believe them as these are the same people that sold me the policies.

 I've looked on the net and there are other advisors out there that claim to be able to reduce charges and x-ray your current investments etc. but googling for some of them brings up bad reviews so it seems to be a bit of a jungle out there. A lot of the jargon in contracts and policies goes over my head so I was wondering if any of you here know of any international advisors who do truly care about their clients or are they all bad.
Title: Re: Royal London 360 - I dun goofed
Post by: elle1984 on May 19, 2016, 01:16:38 AM
Hi everyone,

Me and my husband are another victims of the financial adviser who sold us  RL360. We have contributed with 4100 dollars monthly for the last 15 months. After looking into it and reading all the comments we can't help but wonder what's the best thing to do: give it all up (around 60k) or reduce the premium to 320 dollars and lose everything gradually. We have initiated a complaint that managed to reduce our initial plan set for 25years to 18 years. We are fighting to have the whole thing reversed and willing to involve the appropriate authorities and social media. Has anyone been able to have it reversed? Any happy endings to this nightmare? We desperately need a ray of hope.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on May 19, 2016, 09:43:34 AM
Hi, elle1984.
About your question about the best thing to do: you need to seriously run the math  in a spreadsheet. This thread provides lots of spreadsheets that help you do the math and make your decision. Spoiler alert: I think you'll find that it's best to cut your losses than continue in the plan, but again you have to do the math yourself.

Quote
Has anyone been able to have it reversed? Any happy endings to this nightmare?
I know of only two cases were people have been able to get their money back with an ILAS in a case that was outside the contract "rules" (e.g. early cancellation). In both cases they had to involve the media (respectively the telegraph (http://www.telegraph.co.uk/finance/personalfinance/investing/11726158/Exposed-the-rip-off-investment-advisers-who-cost-British-expats-billions.html) and some popular money blog which name evades me right now) to put some public pressure on the companies behind the insurance.

These ILAS contracts are known to be legally constraining, and some people have said that the only way to come out (money-wise) positively with an early cancellation is to die. That's a tongue-in-cheek joke obviously, but is not far from the truth, as the only case where the contracts allows you to not pay an excessive early surrender fee is in case of death, in which case your significant other gets 101% of the value of the policy.

You might be able to involve the authorities, but they will only be able to go after the financial advisor, not the insurance company. It's still a good idea to do so, as the more people engage authorities in this matter, the more data countries will have to build a case against these products and regulate them better.
Title: Re: Royal London 360 - I dun goofed
Post by: elle1984 on May 22, 2016, 04:21:31 AM
Hi Wololo,

Thank you so much for your reply. We are in the process of building our case. We have contacted the Telegraph and now looking for the best ways of attack. We are gonna make a formal complaint at the financial regulator in Qatar. We are after the financial adviser who lied to us and tied us in this ridiculous plan. Funny enough he is our friend (or was) and we have some incriminatory conversations that could help our case. Also we can prove he has lied to us and hopefully we will have a positive outcome. We will keep you posted.

Hoping we can stop this cons before they ruin more lives.
Title: Re: Royal London 360 - I dun goofed
Post by: human on May 22, 2016, 04:33:53 AM
What nightmare. I can't believe backing out would cost a whole year's worth of investments. Aren't there laws or regs against this? Or is the issue how to enforce?
Title: Re: Royal London 360 - I dun goofed
Post by: elle1984 on May 23, 2016, 12:11:36 AM
I know. These people are cons. The more years they tie you in the more commission they get. They're unscrupulous and they're out there to destroy lives. Be careful people.

We have appointed a lawyer and we are willing to fight it till we get our money back. 
Title: Re: Royal London 360 - I dun goofed
Post by: dragoncar on May 26, 2016, 11:15:59 PM
Quote from: elle1984 on May 19, 2016, 01:16:38 AM
Hi everyone,

Me and my husband are another victims of the financial adviser who sold us  RL360. We have contributed with 4100 dollars monthly for the last 15 months. After looking into it and reading all the comments we can't help but wonder what's the best thing to do: give it all up (around 60k) or reduce the premium to 320 dollars and lose everything gradually. We have initiated a complaint that managed to reduce our initial plan set for 25years to 18 years. We are fighting to have the whole thing reversed and willing to involve the appropriate authorities and social media. Has anyone been able to have it reversed? Any happy endings to this nightmare? We desperately need a ray of hope.

The good news is if you are able to set aside $4k/mo, you can weather a $60k loss, chalk it up to a lesson learned, and still do very well in the end.  Maybe it sets your plans back a year but no more
Title: Re: Royal London 360 - I dun goofed
Post by: Dicey on May 27, 2016, 10:36:43 AM
I'd lost track of this thread, so I'm glad to see it pop up again. Commenting to help keep it high on the list as a cautionary tale. So sorry these vultures are still in business and so intent on trampling on other's right of free speech.
Title: Re: Royal London 360 - I dun goofed
Post by: Kaminoge on June 11, 2016, 11:12:21 PM
I'm just adding another "thanks" for this thread. I posted a thread of my own asking some questions and was pointed to this one. Needless to say I will not be investing in RL360 and I'm very very thankful to have read all this before I made any silly mistakes. I think it can be really difficult for expats who don't have easy access (or any access) to some of the other products people mention, especially those (like me) who move frequently. Thank goodness for the internet and for forums like this one! So a big thanks to those of you who were willing to share your stories.
Title: Re: Royal London 360 - I dun goofed
Post by: africk78 on June 17, 2016, 06:10:18 AM
I have a similar potential problem that I want to get ahead of--I'm an American living in Europe for the foreseeable future, and my family and I generate anywhere from 40-150USD per year of post-tax income that we'd rather invest than have in cash, with a goal of retiring early and relatively luxuriously, at least by MMM standards (no private jets, but plenty of vacations). 

I was recently offered what is called an "International Retirement Plan" from a UK company called Blacktower; this IRP was designed by another group called Trireme, and the investment fund recommended for making contributions is RL360.  The costs associated are similar to what other posts have laid out, but there are other benefits--I'll include what I know here:

--a "premium incentive" of getting 2% "bonus allocation for each premium paid through the policy term"
--an initial bonus of 9180 USD invested for me upon the outset of the contract
--a the loyalty bonus (.25% added per year) to my assets for as long as I make contributions.
  These "bonuses" are confusing to me as I'm not sure I've seen anything like them in U.S. asset management strategies.
*It also sounds like I can make all contributions by credit card, which is great, since I have a card that yields 2.2% cashback.

Other benefits are that I can begin making withdrawals as soon as I turn 50, that I can withdraw up to 300kUSD tax-free for my first withdrawal, and that I don't pay tax on the growth (like a Roth), just the principal (like a regular IRA) upon withdrawal.

Additional costs:
--the "charge on initial units" of .5% per month, and an ongoing contract charge of 1.5%, deducted as .125% of current fund value each month. 
--finally, an initial $2kUSD set-up fee, and a yearly $1500 management fee

I definitely understand the management costs are high, but I don't "need" any money I'm contributing and am approaching the investment strategy as high-risk, high-rewards, with a willingness to incur investment losses in the short or medium term, with the expectation of higher returns in the long-term.

Still, in the back of my head I keep thinking I should just open up a SEP IRA, max that out (my circumstances would allow me to put close to 50k in there every year as a kind of supersized IRA) along with Roths for both my wife and I, meaning we'd be investing until we're 60 rather than 50, not invest quite as much as we would in the "IRP" that's being marketed to me and just spend it instead.  In other words, there's a strong case to put everything into a Vanguard index with super low costs, stop thinking about investments all the time so that my mind can focus on life, and just be done with it.

Please correct me if I'm wrong (and correct me in detail), but right now I'm not convinced that what I'm looking at is a "scam" per se; I do however think I'd need to be very confident in my earnings expectations for the next 15 years (I'm 37 years old) to be a regular contributor, and those contributions would need to be high for the costs to be acceptable.  Then the question is, how much do I need to contribute in order for this strategy to be more profitable than socking everything away into a mix of Roths, SEPs, 529s for my kids (4 and 2 years old, thank you) and brokerage accounts?
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on June 17, 2016, 11:07:45 AM
1) If something sounds too good to be true, it probably is.
2) IIRC there is a spreadsheet attached to a post upthread - have you entered your information in that?
Title: Re: Royal London 360 - I dun goofed
Post by: pbkmaine on June 17, 2016, 11:20:25 AM
It seems simple to me. When everything I read says it's a scam, except for what the company itself says, then I am going to stay the heck away.
Title: Re: Royal London 360 - I dun goofed
Post by: What da on June 17, 2016, 12:22:16 PM
africk78 well at least they gave you most of the actual cost...in my case they didn't. I see you didn't include the fund management fee which is roughly 1.5% per year as well depending on the fund... Look in your contract because there is no way around this fee. My advisor said it would not be applicable to me which is a lie.

Anyway, whatever you invest during the first 2 years will for the remainder of your contract be subjected to:
6% initial unit charge
1.5% contract fee
1.5% fund management fee
So thats 9% per year....anytime the fund makes less then that you are loosing money.
So if the fund during 1 year drops with 5% you just lost 14% of your investment...The next year you would need to make 25%(!!) to recover those losses.. 16% to get back to the previous amount + 9% to cover the fees.

Sure you get a 2% deposit fee but thats one time....the 6% fee keeps running for the entire contract duration..

The initial setup fee and annual management fee go straight to your advisor. This guy should really be in jail!!!!! Because aside from what you are paying him he also receives money from RL360. My former plan did not have any of these fees. Anyway all info on this plan is written pretty clearly in this thread so I'm not sure why your even having doubts. Guys like your advisor should really be removed from this planet. Plain ordinary thieves. Spend a good amount of hours reading through these forums to discover a good way to save money. If your American your lucky, get a Vanguard account and put all your money in ETF's. Unfortunately its a lot harder for us Europeans to find a similar setup...
Title: Re: Royal London 360 - I dun goofed
Post by: Juan Ponce de León on June 18, 2016, 03:19:15 AM
Quote from: What da on June 17, 2016, 12:22:16 PM
If your American your lucky, get a Vanguard account and put all your money in ETF's. Unfortunately its a lot harder for us Europeans to find a similar setup...

Can't you just get an international trading account (IG markets?) and buy the American domiciled ETFs?
Title: Re: Royal London 360 - I dun goofed
Post by: Seppia on June 19, 2016, 07:45:07 AM
There's vanguard in Europe.
Only difference is you have to pay purchasing fees since it's only available through brokerage accounts.
Title: Re: Royal London 360 - I dun goofed
Post by: danclarkie on July 12, 2016, 02:09:52 AM
Interesting to see this whole thing totally blew up in the last few years.

Much respect to MMM for not bowing to the bogus legal threats.
I'm glad it was able to help a lot of people.

Please note if you're using the Google sheet, rather than emailing me to ask for editing rights (happens 2/3 times a month) select "Save a copy" and you can edit that copy to your hearts content, without corrupting the original.

:)
Title: Re: Royal London 360 - I dun goofed
Post by: LivingAbroad on August 30, 2016, 06:49:15 AM
I'm happy Mr Money Mustache is standing up to RL360. In addition to their expensive, bad-for-customers products, their customer service is totally appalling. They stonewall every query and complaint. And they don't seem in the least bit afraid of you going to the Isle of Man Ombudsman.
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on December 04, 2016, 09:08:37 PM
I also fucked up!

Yes, just another fool that got sucked in. I entered the Quantum plan November last year and has been paying 3000usd/month on a 20year plan.
Yesterday I blocked my VISA card, emptied my account and wrote my bank not to pay a single dime to RL360.

I understand the plan now and if I finsh my initial period I will have to pay ~420usd/month just to cover the charges. If I chose to continue with just 300/month after the initial period Ill end up making 17000usd in 20 years - and I dont even think that accounts for inflation......
I would be super happy if someone could modify the MDM's otherwise excellent excel sheet to work with different premium levels for initial and accumulation units!

@dungoofed: You ended up surrendering your plan. What did you do to try and get your money back?
@elle84: How did it go for you?

Yesterday I have sent a proposal to RL360 about transferring my current payments to an Oracle account instead of surrendering. Hope to get an answer of sorts from them during this week.
Title: Re: Royal London 360 - I dun goofed
Post by: arebelspy on December 04, 2016, 09:50:00 PM
Oof, that sucks.  I'm glad you caught it now.  Hate how scummy they are.  =/

Be interesting to hear your experiences trying to break free, please keep us updated!

Welcome to the forums.  :)
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on December 05, 2016, 01:03:23 AM
I case RL360 agree to convert to an Oracle plan... Can someone help me check how the return will be on a 20 year Oracle plan with a 60000usd lump sum?

Does this look right (I am a total newbie with excel)?

Oracle               
Year      Start up fee 7,5% annual   Adm fee 1,2% annual   Inflation   Growth incl inflation
1   60000   4500   720   1,50%   6%
2   57196   4290   686      
3   54523   4089   654      
4   51974   3898   624      
5   49545   3716   595      
6   51110      613      
7   52723      633      
8   54388      653      
9   56105      673      
10   57876      695      
11   59703      716      
12   61588      739      
13   63532      762      
14   65538      786      
15   67607      811      
16   69742      837      
17   71943      863      
18   74215      891      
19   76558      919      
20   78975      948      
Total   78027            

Can this be right???
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on December 05, 2016, 05:49:50 AM
Quote from: quantum123 on December 05, 2016, 01:03:23 AM
Does this look right (I am a total newbie with excel)?
...
Can this be right???
Are you saying that Oracle takes a 7.5% fee each of the first five years?  If so, that's tantamount to robbery.
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on December 05, 2016, 07:30:36 AM
Quote from: MDM on December 05, 2016, 05:49:50 AM
Quote from: quantum123 on December 05, 2016, 01:03:23 AM
Does this look right (I am a total newbie with excel)?
...
Can this be right???
Are you saying that Oracle takes a 7.5% fee each of the first five years?  If so, that's tantamount to robbery.

Copy/paste from the "Oracle Key Features"

Establishment fee
The standard establishment fee is 7.50% of the premium paid. The fee is collected at a rate of 0.375% quarterly in arrears over the fi rst 5 years. Each additional premium will be subject to its own establishment fee. The fee will be collected in the same format as described above.

*I misread that...1.5% annually.

Percentage administration fee
There is a standard ongoing percentage administration fee of 1.20% per year, taken as 0.30% of the current policy value or the premium paid, if higher, deducted quarterly in arrears. Each additional premium is subject to its own percentage administration fee. The fee will be collected in the same format as described above. The percentage administration fee is payable for the lifetime of the policy.

Additional fees
The funds that are held within your policy will be subject to an annual management charge. The charge will vary per fund chosen and further details can be obtained from your fi nancial adviser or the Investment Guide. The annual management charge set by the fund manager is refl ected in the fund price, and is in addition to the Oracle product charges.

Year   Lump sum   Start fee 1.5%/y   Adm fee 1.2%/y   Fund fee 1.5%/y   Inflation   Growth
1   60000.00   900.00   720.00   900.00   0.015   0.08
2   61147.22   917.21   733.77   917.21      
3   62316.38   934.75   747.80   934.75      
4   63507.90   952.62   762.09   952.62      
5   64722.19   970.83   776.67   970.83      
6   65959.71   989.40   791.52   989.40      
7   67220.88   1008.31   806.65   1008.31      
8   68506.17   1027.59   822.07   1027.59      
9   69816.04   1047.24   837.79   1047.24      
10   71150.95   1067.26   853.81   1067.26      
11   72511.39   1087.67   870.14   1087.67      
12   73897.83   1108.47   886.77   1108.47      
13   75310.79   1129.66   903.73   1129.66      
14   76750.76   1151.26   921.01   1151.26      
15   78218.27   1173.27   938.62   1173.27      
16   79713.83   1195.71   956.57   1195.71      
17   81237.99   1218.57   974.86   1218.57      
18   82791.29   1241.87   993.50   1241.87      
19   84374.30   1265.61   1012.49   1265.61      
20   85987.57   1289.81   1031.85   1289.81      
End   89003.79               
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on December 05, 2016, 10:58:09 AM
Quote from: quantum123 on December 05, 2016, 07:30:36 AM
Establishment fee
The standard establishment fee is 7.50% of the premium paid. The fee is collected at a rate of 0.375% quarterly in arrears over the fi rst 5 years. Each additional premium will be subject to its own establishment fee. The fee will be collected in the same format as described above.
*I misread that...1.5% annually.
Percentage administration fee
There is a standard ongoing percentage administration fee of 1.20% per year, taken as 0.30% of the current policy value or the premium paid, if higher, deducted quarterly in arrears. Each additional premium is subject to its own percentage administration fee. The fee will be collected in the same format as described above. The percentage administration fee is payable for the lifetime of the policy.
Additional fees
The funds that are held within your policy will be subject to an annual management charge. The charge will vary per fund chosen and further details can be obtained from your fi nancial adviser or the Investment Guide. The annual management charge set by the fund manager is refl ected in the fund price, and is in addition to the Oracle product charges.
Thus perhaps tantamount only to petty theft.  Or maybe worse - see below.

Quote
Year   Lump sum   Start fee 1.5%/y   Adm fee 1.2%/y   Fund fee 1.5%/y   Inflation   Growth
1   60000.00   900.00   720.00   900.00   0.015   0.08
2   61147.22   917.21   733.77   917.21      
...
19   84374.30   1265.61   1012.49   1265.61      
20   85987.57   1289.81   1031.85   1289.81      
End   89003.79
I don't follow how the table is organized, but do you
 - start with $60K,
 - make no further contributions, and
 - end up with $89K after 20 years?

If so, that's (89/60)^(1/20) - 1 = 2% growth per year.  If you could get 5% growth per year, your $60K would become $159K in 20 years.  In this situation Oracle will have "taken" $70K from you, so that still smells more like robbery than petty theft....
Title: Re: Royal London 360 - I dun goofed
Post by: dragoncar on December 05, 2016, 09:02:23 PM
might be real growth since they have an inflation column. 
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on December 05, 2016, 09:43:36 PM
Help!

I am formulating a complaint to the Ombudsman about Quantum. This is what I have so far. Any suggestions to the content or how I can better the phrasing? I am not native English speaker so.....

Complaint 1:
The way Quantum is constructed it will initially eat away at your investment faster than you are putting money in - paying RL360 its fees but not providing the consumer with any effective return for the first many years. This totally negates the purpose of a pension saving as these initial years lost profit will have a huge impact on the final outcome.

Complaint 2:
The flexibility of Quantum is extremely poor. Very few people will be able to foresee their financial situation 20-25 years in the future. Exiting the plan just 5 years early will incur a massive 34% penalty and all the money invested during the initial period will be inaccessible for the full term.

Complaint 3:
Quantum punish you very hard for decreasing your payments over time, as a fixed fee, based on the initial payments is charged every month. The best approach with Quantum would actually be to start with very small payments for the initial period and then increase over time, which defy any normal idea of a pension saving.

Complaint 4:
Quantum lures you in with big sign-up bonuses, to pay big premiums during the initial period. This is very good for RL360 but very bad for people when they find themselves not being able to keep up the pace. You are then faced with the choice of loosing your the majority of your investment by surrendering the policy or see it wither away as you keep putting money in.

Complaint 5:
Tying all of the above together to see how Quantum will actually work for you is next to impossible without through knowledge on the subject.
Title: Re: Royal London 360 - I dun goofed
Post by: DavidAnnArbor on December 06, 2016, 05:54:35 AM
And this is why we need a Consumer Financial Protection Bureau, along with strict banking regulations. Yes government is good !!!!
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on December 06, 2016, 07:45:16 PM
BUMP...

Does anyone have contact with "dungoofed" or "elle84"? I have send them PM's but no response yet. I am VERY interested in hearing about their experiences and what they did to try and minimize their losses.
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on December 06, 2016, 08:08:22 PM
Quote from: quantum123 on December 06, 2016, 07:45:16 PM
Does anyone have contact with "dungoofed" or "elle84"? I have send them PM's but no response yet.
It appears neither has logged in here for several months.  That doesn't help you get info, but at least they aren't specifically ignoring you.
Title: Re: Royal London 360 - I dun goofed
Post by: Dicey on December 06, 2016, 10:34:41 PM
Quote from: quantum123 on December 06, 2016, 07:45:16 PM
BUMP...

Does anyone have contact with "dungoofed" or "elle84"? I have send them PM's but no response yet. I am VERY interested in hearing about their experiences and what they did to try and minimize their losses.
Try reaching out to one of the moderators. They've been known to be very helpful ;-)
Title: Re: Royal London 360 - I dun goofed
Post by: angryperson on February 03, 2017, 02:49:23 AM
Hi everyone, a lot of people seem to be having issues with RL360 Quantum, and other products, such as PIMS.

If you're in that boat, a group is being put together at Pension Life to bring legal action against them, since the Ombudsman in the IOM appears to be useless too.

Have a look around the website here: http://pension-life.com/.

And get in touch with angiebrooks [ at ] pension-life.com. If a few can come together we stand a good chance of getting some recourse.
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on February 03, 2017, 03:26:37 AM
This is fantastic! I already sent Angie an email.
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on February 08, 2017, 11:13:03 PM
Hi

My adviser says that RL360 is open for a restructuring of my Quantum plan to better fit my needs. IF that is actually the case, what do you think would be reasonable?

My thoughts:
1. RL360 will reclaim the signup bonus
2. RL360 will cancel the 0.5%/month Initial Unit Charge for the full policy term
3. RL360 will cancel all Investment Adviser Fees
4. RL360 will lower the minimum monthly premium to 50usd
5. RL360 will allow withdrawls of both initial and accumulation units (for specific purposes like buying a house, hospital treatment and other "extraordinaty" events)
6. ???
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on February 08, 2017, 11:31:07 PM
Quote from: quantum123 on February 08, 2017, 11:13:03 PM
IF that is actually the case, what do you think would be reasonable?
6. ???
6. RL360 will return all contributions with no surrender fee.
Title: Re: Royal London 360 - I dun goofed
Post by: Dicey on February 09, 2017, 12:16:18 AM
Quote from: MDM on February 08, 2017, 11:31:07 PM
Quote from: quantum123 on February 08, 2017, 11:13:03 PM
IF that is actually the case, what do you think would be reasonable?
6. ???
6. RL360 will return all contributions with no surrender fee.
I'd move that to #1. Here's hoping!
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on February 09, 2017, 01:04:53 AM
Quote from: MDM on February 08, 2017, 11:31:07 PM
Quote from: quantum123 on February 08, 2017, 11:13:03 PM
IF that is actually the case, what do you think would be reasonable?
6. ???
6. RL360 will return all contributions with no surrender fee.

Haha however amazing that would be I know that RL360 will not let go of the money that easily so I try to be "realistic" in my terms.
Title: Re: Royal London 360 - I dun goofed
Post by: theolympians on February 09, 2017, 07:17:38 PM
I don't get the investment. Is there a 60000 lump sum with no additional contributions? Or do contributions continue? I thought I read somewhere in here that a person was paying a couple grand a month to them.

I don't really understand what the investments are in. Are they common funds that are available anywhere but Quantum happens to have their own fee structure?  Or do they have their own funds?
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on February 09, 2017, 08:23:39 PM
The Quantum plan is designed for a fixed amount every month for the full term (20 years for some). You will be punished if you pay less than that agreed amount. The Oracle is a lumpsum scheme.

The funds are "common" funds. RL360 is supplying the access and administration.

Quote from: theolympians on February 09, 2017, 07:17:38 PM
I don't get the investment. Is there a 60000 lump sum with no additional contributions? Or do contributions continue? I thought I read somewhere in here that a person was paying a couple grand a month to them.

I don't really understand what the investments are in. Are they common funds that are available anywhere but Quantum happens to have their own fee structure?  Or do they have their own funds?
Title: Re: Royal London 360 - I dun goofed
Post by: Little Bird on March 20, 2017, 07:53:35 AM
I've been in the RL360 Quantum fund now for 4.5 years. I'll admit and say I was much more naive then than I am now, and I'm still pretty naive! But my senses started tingling late last year and after finding this site and some other stuff on Reddit I spoke to my advisor today who did nothing to allay my fears.
If I bail out by the end of this month I will lose about $20k and my wife is pretty mad to say the least...
I started with an $800/month deposit but reduced that to $300/month for the past 15 months or so. I was going to increase my premiums again but now I'm thinking just to cut my losses.
I've run the spreadsheets that I found on the earlier pages. Thanks a lot, they proved very insightful. But I have a question,
the Premiums Ifl Adjusted column, if the IOM RPI rate changes monthly how can you make an accurate chart? Do you have to input each time it changes?
On my RL360 portal is says my account is up 11.65% since inception. Initially that looks good until I worked out how much fees I'd paid over the past 4.5 years, admittedly my premium amount decreased so my overall return is lower.
When I look at the Profit/Loss column after 30 years though, that's pretty disheartening...
Title: Re: Royal London 360 - I dun goofed
Post by: NoStacheOhio on March 20, 2017, 09:35:38 AM
Quote from: Little Bird on March 20, 2017, 07:53:35 AM
I've been in the RL360 Quantum fund now for 4.5 years. I'll admit and say I was much more naive then than I am now, and I'm still pretty naive! But my senses started tingling late last year and after finding this site and some other stuff on Reddit I spoke to my advisor today who did nothing to allay my fears.
If I bail out by the end of this month I will lose about $20k and my wife is pretty mad to say the least...
I started with an $800/month deposit but reduced that to $300/month for the past 15 months or so. I was going to increase my premiums again but now I'm thinking just to cut my losses.
I've run the spreadsheets that I found on the earlier pages. Thanks a lot, they proved very insightful. But I have a question,
the Premiums Ifl Adjusted column, if the IOM RPI rate changes monthly how can you make an accurate chart? Do you have to input each time it changes?
On my RL360 portal is says my account is up 11.65% since inception. Initially that looks good until I worked out how much fees I'd paid over the past 4.5 years, admittedly my premium amount decreased so my overall return is lower.
When I look at the Profit/Loss column after 30 years though, that's pretty disheartening...

Show her the spreadsheet, and the difference between just taking the loss now, and letting it drag out for another ~25 years. That's long enough for a child born today to get a Master's degree and start a career.

If she's just going to get mad that it happened in the first place, that's kind of petty. Plenty of people get suckered.
Title: Re: Royal London 360 - I dun goofed
Post by: Little Bird on March 20, 2017, 09:44:59 AM
Nah, she was initially skeptical of the whole thing as I could pay via credit card and she thought that dodgy, so as well as being mad at the whole thing it was also "I told you so!", haha
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on March 20, 2017, 09:46:43 AM
You can assume a constant 3% for isle of man inflation for example. As far as I remember, that number doesn't have a huge impact on the overall result.
Title: Re: Royal London 360 - I dun goofed
Post by: Little Bird on March 20, 2017, 09:59:50 AM
Ok thanks.
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on March 21, 2017, 12:48:55 AM
Quote from: Little Bird on March 20, 2017, 09:59:50 AM
Ok thanks.

Welcome to this very sad club... Please contact >angryperson< if you are interested in going after RL360.

If you cannot pay the 800usd until the plan is matured - then strongly consider to drop it! Smaller contributions will hardly cover the fees, which, asyou discovered yourself, are humongus. I am in 33000usd so I know all about what you are going through - my wife was also the smarter one :) My advisor is afterall trying to patch things up (most likely not to lose all of his bonus) which mean that my money also are not lost yet.
Title: Re: Royal London 360 - I dun goofed
Post by: DavidAnnArbor on March 21, 2017, 08:46:15 AM
ok MMM administrator please make this thread or make a warning about this company a wiki at the beginning of Investor alley.

It's time for MMM to do everything possible so other people aren't screwed over by this financial Madoff like scam !!!!
Title: Re: Royal London 360 - I dun goofed
Post by: Little Bird on March 21, 2017, 08:44:39 PM
So do you think that the even after 5 years, in my case, my "advisor" is still collecting her commission? She hasn't even replied to my email from two days ago and when I think about it, all the delays etc in communicating over the past years just makes me even more mad. So if I can help to screw her now, that would be some reward.
I'm going to take the hit and then put what I get back in a Vanguard index fund.
I'm really happy I found this, better late than never. And I'll say that given my troubles, my interest now in investing has increased dramatically. I'm reading Andrew Hallam's books and find them easy to understand.
So maybe a silver lining from all this? Try to be optimistic...
Title: Re: Royal London 360 - I dun goofed
Post by: danclarkie on March 29, 2017, 01:59:56 AM
Hey, Little Bird.

I believe I've been speaking with you on Reddit too.

To answer your point:

Quote
So do you think that the even after 5 years, in my case, my "advisor" is still collecting her commission?

No, the commission from the product dries up after the initial lock up period.
However, the firm gets a commission kickback from certain funds for every dollar they funnel into them.
So within your RL360 account you will be in the funds that pay the biggest kickback to the IFA firm.

It's unethical as fuck.

I notice you're in SE Asia, where exactly? I now live in Singapore.

I still get cold calls from these firms selling me this shit, I've had 2 this month.
Title: Re: Royal London 360 - I dun goofed
Post by: Little Bird on March 29, 2017, 08:05:28 AM
Thanks Dan.
I'm in Cambodia! Where the financial side matches the wild west nature of this Kingdom...
Title: Re: Royal London 360 - I dun goofed
Post by: Wanderlust89 on March 30, 2017, 05:02:40 AM
How I wish I'd found this page 8 months ago! I have been paying $1500 into the Rl360 quantum for 8 months now so I'm $12k invested on a 25 year plan.

I'm a British expat based in Dubai, I'm in engineering and don't have a great knowledge of finance so I put my faith in a financial advisor recommended by a colleague. I'm actually not even annoyed at the advisor, everyone knows not to trust these guys out here, I went along knowing that he would try and sell me something that was best for his commission - and I still fell for his nice guy act and sales pitch. Only myself to blame.

I told him the $1500 is more than affordable at the moment but when I leave the Middle East in 5-10 years time I will need to drop my payments significantly, which he said was absolutely fine. Repeatedly brought up the 2 year payment break as well. When in reality, nobody should go near this plan unless they can guarantee full payments for the duration - and even then it seems it is a poor choice! I shouldn't have signed up until I 100% understood the fees and how it all works, but looking at the spreadsheets on this thread it's crystal clear that I need to get out now and start again.

I'm in a fortunate position where I'm saving around $7.5k a month at the moment so at least the rl360 money was only 20% of my savings. My plan is to cancel rl360 immediately then use the next few months educating myself on how to best invest my money (using this forum and similar ones, and the resources recommended by you guys), and hopefully won't be too long in making that 12k back.

An expensive lesson, but very happy I realised at this stage and not a few years down the line when I need to reduce payments!
Title: Re: Royal London 360 - I dun goofed
Post by: SKRBM on April 05, 2017, 03:38:22 PM
Same position as many others. Did not do a proper due diligence on this investment and considered it a safe bet to store some savings in. I am at month 37 with $1000 monthly contributions. My withdrawal amount is at approx $17,000 with an account balance of $41,000. I have attempted to use the templates provided within this post but still unsure if I have the inputs correct. Have been in touch with my advisor today who seems reluctant and at times ignorant of the RL360 structure, and continues to suggest that I come into the office for a chat. I don't blame him necessarily, but anyone with any financial sense should press for a full fee structure prior to signing to ensure that returns will at least be on par with a fund that can be accessed privately along with estimated re-balancing costs.

I found this site only as I figured this out on my own and asked this week to adjust my contribution down to the minimum. Would anyone still on the thread be able to clarify why paying the minimum for the remainder of the period is still a poor decision, in my case over withdrawing and forfeiting $24,000?
Title: Re: Royal London 360 - I dun goofed
Post by: mmmburner on April 10, 2017, 07:48:23 PM
Hi mods you URGENTLY need to put a 301 redirect in for this thread.

forum.mrmoneymustache.com/investor-alley/i-dun-goofed/

Needs to be redirected to:

https://forum.mrmoneymustache.com/investor-alley/royal-london-360-i-dun-goofed/

External sites linking to this important thread are breaking, as are internal links eg

http://www.mrmoneymustache.com/rl360-insurance/

https://forum.mrmoneymustache.com/investor-alley/rl360-zurich-international-generali-friends-provident-expats-beware/

This thread has already helped many people and the correct redirection will help many more going forward, especially as Pete himself has shown willingness to defend those who can't always defend themselves.
Title: Re: Royal London 360 - I dun goofed
Post by: DavidAnnArbor on April 11, 2017, 06:03:32 AM
When I read these stories I just want to cry.
Title: Re: Royal London 360 - I dun goofed
Post by: JamesAt15 on April 12, 2017, 11:47:28 PM
I recently received a letter from Royal London explaining that they were increasing my account fee, and the last time they increased my fee was 2013. The letter says in bold text, "This shows the fee per month."  It then shows my fee for a Paid Up (i.e. I am not making contributions to it) account as increasing from about $170 to $175.

"Holy crap!" is my natural reaction.

I dug up the letter from 2013 and at that time they increased my monthly fee from about $12 to $14. That letter is the same format and also included the bold "This shows the fee per month." sentence.

Dividing the $170 fee by 12, I get the same value of about $14 they listed in 2013.

Well... I can only assume they mistakenly quoted me a yearly figure for my account fee instead of a monthly fee. And I am checking with them to make sure this is correct.  UPDATE: I received an email back from them that they did make a mistake on the letter and have already sent out correction and apology letters. I will be curious to see the postmark on the correction letter.

While it is perhaps a small mistake, I don't like the feeling (stemming from larger mistakes they have made with my account in the past) that they are not as fastidious as I would want from a group holding and managing a large amount of money for me.
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on June 15, 2017, 11:54:30 PM
An update on my case!

I am pretty ecstatic right now as I just received below email from my advisor. I have been very patient with him over the last 7 months and that now seems to be fruitful. Money is not back in my account yet but this is a huge step in the right direction :)

******
-Wednesday, 14 June 2017 at 15-03
Hi P
So....what did the suits at the round table have to say?


Date: Friday, 16 June 2017 at 12.53
Hi Niels

Well good news in that the ‘suits’ have agreed to return all of your money once we have paid back all the commission so no restructure is required! I would once again, ask for your patience Niels as this is going to take some time and I am waiting now for a written agreement from RL360 on this. I will also send you a written agreement between ourselves as this has to come out of my future commission earnings, not the company. It will take some time for me to pay that back to them I’m sure you understand (I do not take a salary form the company).

We can go into more detail on this once I get the written agreement from them but I am now working with someone at RL360 who is much more proactive than previously.

Again, thank for your patience and understanding and wish you a good weekend.

Regards
P



*********

 - A GREAT weekend to everyone!!!
Title: Re: Royal London 360 - I dun goofed
Post by: Little Bird on June 28, 2017, 06:06:55 AM
Quote from: SKRBM on April 05, 2017, 03:38:22 PM
Same position as many others. Did not do a proper due diligence on this investment and considered it a safe bet to store some savings in. I am at month 37 with $1000 monthly contributions. My withdrawal amount is at approx $17,000 with an account balance of $41,000. I have attempted to use the templates provided within this post but still unsure if I have the inputs correct. Have been in touch with my advisor today who seems reluctant and at times ignorant of the RL360 structure, and continues to suggest that I come into the office for a chat. I don't blame him necessarily, but anyone with any financial sense should press for a full fee structure prior to signing to ensure that returns will at least be on par with a fund that can be accessed privately along with estimated re-balancing costs.

I found this site only as I figured this out on my own and asked this week to adjust my contribution down to the minimum. Would anyone still on the thread be able to clarify why paying the minimum for the remainder of the period is still a poor decision, in my case over withdrawing and forfeiting $24,000?

I still see my "advisor" socially and want to slap them each time I do...
Anyway, when I ran the spreadsheet, contributing the minimum each month after you've passed the initial allocation period will leave you paying a higher % of fees on a lower monthly deposit, essentially destroying any gains you'd made in the allocation period.
I lost $20k 2 months ago as I withdrew however I'm confident in the knowledge gained from reading this forum among others, by reinvesting smarter in mutual funds, going by the current trends, within 3 years I'll be where I was had I still been wasting my money with RL360.
Title: Re: Royal London 360 - I dun goofed
Post by: vietnaminvestor on August 15, 2017, 07:13:30 AM
I have a plan which i think is similar to this - it is through Devere Group in Vietnam. It is the Providence Life, Compass Savings.

10 year plan, 6 months in.
Monthly Payment is $800 a month
First 12 months are allocated for initial premiums and basically from my understanding are to cover fees for the 10 years.

Does this sound familiar? What questions should I be asking the advisor, i have a payment due in 4 days - any advice would be appreciated.

What is the worst case if we were to keep paying $800 for 10 years, not missing any payments? Thanks
Title: Re: Royal London 360 - I dun goofed
Post by: MDM on August 15, 2017, 08:21:00 AM
Quote from: vietnaminvestor on August 15, 2017, 07:13:30 AM
I have a plan which i think is similar to this - it is through Devere Group in Vietnam. It is the Providence Life, Compass Savings.
Does CompassTandC (https://www.providence.life/resource/1489766894000/CompassTandC) describe what you have?

If so, it is a "whole life insurance" policy. 

In general, insurance should be used for insurance, while investment account should be used for investing.

Also in general, whole life is much more expensive than term life insurance.

As for "What questions should I be asking the advisor?", one that comes to mind is "how much money would I get back if I cancelled today?"
Title: Re: Royal London 360 - I dun goofed
Post by: quantum123 on January 13, 2018, 02:51:04 AM
It IS possible!

I got my money back from RL360:
https://forum.mrmoneymustache.com/investor-alley/rl360-royal-london-360-i-got-my-money-back-d/
Title: Re: Royal London 360 - I dun goofed
Post by: JAYSLOL on January 14, 2018, 10:00:25 AM
Quote from: quantum123 on January 13, 2018, 02:51:04 AM
It IS possible!

I got my money back from RL360:
https://forum.mrmoneymustache.com/investor-alley/rl360-royal-london-360-i-got-my-money-back-d/

Congrats!  Reading about this company and their lawsuit with MMM was interesting.  I'd never trust a company that would have contracts to contribute money for 30 year timelines
Title: Re: Royal London 360 - I dun goofed
Post by: DavidAnnArbor on January 14, 2018, 06:14:15 PM
Just the name Royal London 360 sounds like an overhyped scam
Title: Re: Royal London 360 - I dun goofed
Post by: JAYSLOL on January 14, 2018, 08:28:54 PM
Quote from: DavidAnnArbor on January 14, 2018, 06:14:15 PM
Just the name Royal London 360 sounds like an overhyped scam

Like Entertainment 720

Title: Re: Royal London 360 - I dun goofed
Post by: itsnotashley on October 20, 2019, 07:10:18 AM
I'm new to MMM...signed up as a result of RL360 research on reddit which landed me here.
I'm an expat living in Dubai and have a RL360 Quantum plan (capital redemption option); I just finished a year of putting $1630 per month into it and I have 21 years to go. My advisor makes 1% of policy value per year, which I thought was fair since it incentivizes him to put in the work. I've gone through many of the horror stories here, but they all seem relatively short-term (in which you do end up losing everything you've put in, a T&C that was explained to me when I signed on because I was thinking long-term). I'm wondering if there are any stories of people who have stuck it out for the long haul and what the outcomes were? I've also used danclarkie's google sheet from 2014 to calculate, but I am also wondering if any fund over time would have a different outcome to the growth scenarios in the sheet?
Alternatively, if anyone has pointers on investment accounts/funds that they've invested in for 5-10+ years and have had a better outcome.

Apologies if these questions have been asked and answered before; I may have missed them.
Title: Re: Royal London 360 - I dun goofed
Post by: StockBeard on October 20, 2019, 09:11:21 PM
This thread has the answers, but it's a complicated topic. Read again, run the spreadsheets again, etc... it might take some time, but eventually it will click.

Would love to help more, but I had to sign a legally binding agreement years ago which prevents me from being of much help (see: https://www.mrmoneymustache.com/rl360-insurance/ for some details). Ultimately anyway the decision needs to come from you.

For expats it's tough to find good investment options. If you are looking around for alternatives to these offshore insurance policies, I suggest you read Andrew Hallam's "Global Expatriate Guide to Investing" (https://www.amazon.com/Global-Expatriates-Guide-Investing-Millionaire/dp/1119020980 - Not an affiliate link) for answers specific to your situation, and bogleheads's philosophy for the general idea: https://www.bogleheads.org/wiki/Bogleheads%C2%AE_investment_philosophy. Also everything on this site, of course, which has the general principles, but you will not find here that much information to put the general ideas in practice as an expat.
Title: Re: Royal London 360 - I dun goofed
Post by: Kalergie on October 21, 2019, 12:05:08 AM
Quote from: itsnotashley on October 20, 2019, 07:10:18 AM
I'm new to MMM...signed up as a result of RL360 research on reddit which landed me here.
I'm an expat living in Dubai and have a RL360 Quantum plan (capital redemption option); I just finished a year of putting $1630 per month into it and I have 21 years to go. My advisor makes 1% of policy value per year, which I thought was fair since it incentivizes him to put in the work. I've gone through many of the horror stories here, but they all seem relatively short-term (in which you do end up losing everything you've put in, a T&C that was explained to me when I signed on because I was thinking long-term). I'm wondering if there are any stories of people who have stuck it out for the long haul and what the outcomes were? I've also used danclarkie's google sheet from 2014 to calculate, but I am also wondering if any fund over time would have a different outcome to the growth scenarios in the sheet?
Alternatively, if anyone has pointers on investment accounts/funds that they've invested in for 5-10+ years and have had a better outcome.

Apologies if these questions have been asked and answered before; I may have missed them.

I suggest you also have a look here in the UAE Bogleheads FB group: https://www.facebook.com/groups/SimplyFI/
Title: Re: Royal London 360 - I dun goofed
Post by: arebelspy on October 21, 2019, 02:12:35 PM
In a nutshell, the math over the long term is so bad, it's best to get out when you can, with a loss, than keep pouring money into the pit.

That's why people are taking the short term loss. So then they can invest their monthly savings into a better investment.
Title: Re: Royal London 360 - I dun goofed
Post by: centastic on January 05, 2020, 09:49:54 PM
Just because the product is not illegal in Dubai doesn't mean it shouldn't be.

Your advisor isn't putting in any work. Sorry to be the one to break the fantasy.

Anyway, let us know how you go, what you decide to do.