Ideas
Hi Confused,
Getting price right is terribly important but of greater importance is getting your investment strategy right, and that means getting advice.
Advice must be paid for, and there is a few models, some clearly better than others - provided you use a good advisor;
1. You can deal directly with a product provider. This typically results in a bite of 5%, but it can be higher - and up to 50% of your first year contributions could be snaffled up too. The fund management charge will be between 0.75% and up to 2% pa. Uugh
2. You can use a normal commission based intermediary who is likely to charge you something at the upper end of the above prices.
3. You can use a low price, commission-paid intermediary who is likely to give the advice but major on the fact that his or her firm use lower commissions than the highest in the market, like 3% on contributions etc, but that doesn't mean your getting good value - just cheaper than the dearest.
4. You can use a fee based intermediary, of which there are different hues. Most charge fees of up to €1500 to set up a scheme, but fees of €500 to €800 are more common and closer to the cost of time required to advise and report to you.
5. You can pay a strong fee like @ €200 per hour including travel, meeting and report to a pure fee only advisor, and then execute the advice through a discount house where you could get close to zero entry costs on your contribution and fund charges of, probably 1% or so.
6. You could become an employee of a product provider and get manufacturing rates like, zero entry costs and fund charges maybe 0.75% to 1% pa.
The PRSA "Standard" is a useful benchmark. It takes 5% on the contribution and fund charges at 1%pa, but nothing on the contribution and fund charges of 1.25% pa or less would be even better for example. The cheapest offer on the open market I think is Quinn Life where you can get personal pensions at no entry costs and fund charges at 1%. advice is over the phone, but don't expect a well experienced advisor.
Whatever you do, I'd suggest diversification across asset managers if you're putting in large ammounts, ie set up a portfolio. If you've 20 to 30 years to retirement chose equity funds. The longer the term the more you should be in equities. You could use a combination of index tracking funds and specialist ones such as focused funds that concentrate on a narrower range of stocks like 15 to 30, compared to 50 to 80 in a general equity fund.
You're not wedded to an asset manager so make sure you look at the cost with your advisor of switching across asset managers if one fails to perform reasonably in the future. If you've got the right advisor, the firm might do this at no cost to you, and no commission effects.
Hope this helps.
Seven of Nine