Got it to connect finaly with this post:
http://forum.pfsense.org/index.php/topic,32319.0.html
I added VPN Shell access to the user i was using in the IPSec config. Now I have the iphone on a diffrent network 192.168.197.0/24 than my main network 192.168.196.0/24. I need to figure out how to route the traffic from the 192.168.197.0/24 network to my 192.168.196.0/24 network. This all pivots around the setting in the VPN:Ipsec:Mobile under Client configuration (mode-cfg) virtual address pool. Provide a virtual IP address to clients.
Because you put in a different network you need a route to your lan network. I am not sure how to make a route to the lan with pfsense(I am a cisco guy). Almost need to setup a virtual interface and have a gateway address? Any advice?
Attached a screenshot of the settings I have.
VPN-IPSEC-Mobile.JPG
VPN-IPSEC-Mobile.JPG_thumb