The benefit of availing of the "net pay" facility is worth something.
In terms of AVC charges, they mainly fall into two categories:
- the annual management charge: ideally you should be looking for a charge of 0.75% pa, but not more than 1% pa. Over time, the amc is the most important charge.
- the upfront charge: this can vary up to 5% of each contribution, but mostly will tend to be circa 2%.
Some providers will seek to charge a higher amc on the basis that they are sharing part with the advisor. The upfront charge tends to be source of paying commission to the advisor. Some products will have no upfront charge (ie 100% allocation) but with a higher amc, say 1% or 1.25%.
Personally I would focus on getting the lowest possible amc.
Ask the Advisor to clearly outline the charges.