However as we can see despite the pay and their so-called expertise most of them fail to beat

However, as we can see, despite the pay and their so-called expertise, most of them fail to beat the returns of the index. Unit trust managers are ultimately paid by the people who invest in the fund. That is where a good chunk of your 5 per cent initial charge and the annual management fee goes.Send us your question and if we publish it, you’ll win a Fool baseball cap. E-mail to UKColumn fool or post to Motley Fool, The Independent On Sunday, 1 Canada Square, London E14 5DL..

Are you stuck when it comes to mortgages? In a new fortnightly series, an independent broker suggests ways for ‘IoS’ readers to get the best deal

Tudfil Adams and her partner Mike Bevan live in Powys and feel they are stuck in a mortgage rut – paying over the odds for a long-term fixed-rate home loan.
Ms Adams says: “My reasons for taking out this fixed deal initially were in part for financial security but also for the convenience of having all my arrange-ments with my high-street bank. Now I feel the convenience has proved an expensive option and I now wish I had put a little more effort at that time into my choice of mortgage.”Ms Adams, 45, is county librarian and Mr Bevan, 54, is a retired college lecturer. They have a combined income of pounds 43,000 a year and took out a pounds 54,000 mortgage in 1994 on a 17-year term. This is split between a repayment (pounds 33,600) and an interest-only deal backed by an endowment (pounds 23,400).However, their current fixed rate, with Lloyds Bank, runs until 2004 and it’s payable at a punishing 8.99 per cent.

With variable rates now around 6.8 per cent, they feel they should be able to get a better deal.Simon Tyler says: “The benefits of fixed-rate mortgages are obvious – they provide security and certainty of payment for the specific fixed period. However, there are points in the economic cycle when these fixed rates can leave you high and dry. With five years to go, this couple are paying approximately 3.5 per cent more each year than necessary.”After studying the problem, Mr Tyler came up with a solution that should save the couple around pounds 12,500 – and cuts three years off their repayment mortgage.The problemMr Tyler says the basic saving is easy to spot: if Ms Adams and Mr Bevan could save 3.5 per cent on their current payment (pounds 474 in total), they should be able to knock pounds 160 a month off the loan. But in this case it’s not so simple – there are only 12 years, until May 2011, remaining on their current deal: “With a repayment mortgage it is best to match the new repayment term to the existing term,” Mr Tyler says. In other words, if you are looking to swap an existing mortgage, don’t fall for patter that suggests massive savings on the basis of a new 20- or 25-year deal Decide what suits you. You may improve cash flow now by adding to the term of your loan, but don’t saddle yourself with unnecessary debt stretching well into retirement.The short repayment term limits the savings and the deals available.