I am back, with some queries about the father’s ARF, which I am reviewing.
There were two AVCs, one was linked to main pension, one was a PRSA-AVC.
The ARF started with Irish Life in Dec 2008, broker is Cornmarket, 101% allocation.
- Initial sum into ARF = 38,770
- initial fund is Consensus Fund Series V, Irish Life risk code 5/7
- the AMC is 1.50%
Nearly three years later, June 2011, the PRSA-AVC was matured, and added to the ARF.
- Second sum = 24,130
- Second fund is Public Sector Cautious Fund Series V, Irish Life risk code 3/7
- The AMC is 1.53%
- 24,371 went into the fund, so 101% allocation
Neither the parents nor I paid much attention to the fund values until now.
What I did notice over the years was that even after the withdrawal of 5% of the fund as an annual income, the capital value was holding up, or growing. I am now having a better look at the annual statements.
Consensus Fund unit price
- 2009 = 0.876 euro
- 2022 = 2.035 euro
- Growth over 13 years is 132%
Public Sector Cautious Fund Series V unit price
- 2011 = 1.031 euro
- 2022 = 1.296 euro
- Growth over 11 years is 25.7%
- I presume the growth is dragged down as in the initial factsheet, 25% of this fund is in cash, 25% in Govt Bonds
One thing I noticed: the 5% income each year has always been taken from the (better-performing) Consensus Fund. This means this fund has fallen from over 48k units to 16k units. The units in the Cautious Fund are unchanged.
I never noticed this until now, years later.
Total saved = 62,900, most recent value = 63,500, after 5% income each year
My question: given that my father is reasonably physically healthy, given that the 5% annual income is not needed (it is not spent, it is saved), are we better to do a fund switch?
Could we request the 5% income to be drawn from both funds?
Or should we switch out of the Cautious Fund into 100% Consensus Fund?
Or switch brokers to get better AMCs?
I suppose my query fits into the debate on asset allocation in ARFs.
Thanks.