Director Pension - Fees

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NY_Resident

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I am about to set up a (proprietary) director's pension following the establishment of a business). I plan to aggressively fund to Rev Max over the next few years. What range of fees (entry bid/offer spreads....if they exist anymore?) and annual management fund fees (assume 100% passive global equity) should I expect? You can assume a six figure annual pension contribution.

Also - is there any difference in fee structure between going through a broker, versus direct to a financial institution (brokers, please don't be offended!)?

Thanks
 
NY_Resident said:
I am about to set up a (proprietary) director's pension following the establishment of a business). I plan to aggressively fund to Rev Max over the next few years. What range of fees (entry bid/offer spreads....if they exist anymore?) and annual management fund fees (assume 100% passive global equity) should I expect? You can assume a six figure annual pension contribution.

Also - is there any difference in fee structure between going through a broker, versus direct to a financial institution (brokers, please don't be offended!)?

Thanks
Click to expand...
You get the direct sales team from the financial institution who can only get paid by commission wheras a financial advisor can charge a fixed fee. if you are putting in six figures for the next number of years, it's not hard to work out which works out better.

There is no bid/offer spread anymore, just the amc, fund charge and set up/ ongoing advice fee.


Steven
www.bluewaterfp.ie
 
Steven Barrett said:
You get the direct sales team from the financial institution who can only get paid by commission wheras a financial advisor can charge a fixed fee. if you are putting in six figures for the next number of years, it's not hard to work out which works out better.

There is no bid/offer spread anymore, just the amc, fund charge and set up/ ongoing advice fee.


Steven
www.bluewaterfp.ie
Click to expand...
Good point - thanks Steven
 
While ITC/Conexim is a reasonable solution to what you are trying to achieve, there is a simpler and more cost effective option.

How does this sound? Vanguard passive Global Equities, US S&P, Euro Govt Bonds with a TER of 0.42%. Eurozone Equities marginally more expensive at a 0.43% TER. A Range of Multi- Asset funds with marginally higher TERs for those that need them.
100% Net allocation rate, no entry or exit charges.
Ongoing adviser charges only if selected and there are a range of value add services which are provided for this. Clients can do their own cost benefit analysis to see if they need or want these services.

Of course there is a set up fee which depends on a) whether or not the client has selected the on-going advice or not and b) the specifics of the case.

I haven't posted here for quite a while as tbh I have been put off somewhat by the unnecessary complexity of some posts and a somewhat argumentative tone. Neither of which in my opinion helps anyone, and AAM is a great tool for anyone trying to educate themselves. Keep up the good work Brendan!

With the "keep it simple" narrative, the above is our starting proposition for pension, and ARF investment strategies. We are not ruling out any active management options but they need to demonstrate strong value add before being considered over and above the passive option and then only for a portion.

We have done a large amount of independent analysis and over the last decade there has been a huge under performance of domestic fund managers versus the Vanguard passive equivalent. We looked at the performance of one of the 'best' performing Balanced Managed funds and compared versus a Vanguard equivalent. The under performance has been significant at over 1.74% per annum over 10 years. To be clear, in the future the under performance may reverse, stay the same or even get worse - no one knows ... but the drag caused by higher costs alone will repeat, year after year.

We have done specific modelling, with help from Tony Gilhawley, for retirees with ARFs. Over a long 30 year time frame the additional drag from both higher costs and under performance ( if it persists) can have a huge impact on the total income taken in retirement and the remaining value of the ARF for legacy purposes. I strongly recommend anyone with an ARF should look at this.

Anyway I hope the above helps NY_Resident.
All the best Vincent
 
While ITC/Conexim is a reasonable solution to what you are trying to achieve, there is a simpler and more cost effective option.
North Star said:
How does this sound? Vanguard passive Global Equities, US S&P, Euro Govt Bonds with a TER of 0.42%. Eurozone Equities marginally more expensive at a 0.43% TER. A Range of Multi- Asset funds with marginally higher TERs for those that need them.
100% Net allocation rate, no entry or exit charges.
Ongoing adviser charges only if selected and there are a range of value add services which are provided for this. Clients can do their own cost benefit analysis to see if they need or want these services.

Of course there is a set up fee which depends on a) whether or not the client has selected the on-going advice or not and b) the specifics of the case.

I haven't posted here for quite a while as tbh I have been put off somewhat by the unnecessary complexity of some posts and a somewhat argumentative tone. Neither of which in my opinion helps anyone, and AAM is a great tool for anyone trying to educate themselves. Keep up the good work Brendan!

With the "keep it simple" narrative, the above is our starting proposition for pension, and ARF investment strategies. We are not ruling out any active management options but they need to demonstrate strong value add before being considered over and above the passive option and then only for a portion.

We have done a large amount of independent analysis and over the last decade there has been a huge under performance of domestic fund managers versus the Vanguard passive equivalent. We looked at the performance of one of the 'best' performing Balanced Managed funds and compared versus a Vanguard equivalent. The under performance has been significant at over 1.74% per annum over 10 years. To be clear, in the future the under performance may reverse, stay the same or even get worse - no one knows ... but the drag caused by higher costs alone will repeat, year after year.

We have done specific modelling, with help from Tony Gilhawley, for retirees with ARFs. Over a long 30 year time frame the additional drag from both higher costs and under performance ( if it persists) can have a huge impact on the total income taken in retirement and the remaining value of the ARF for legacy purposes. I strongly recommend anyone with an ARF should look at this.

Anyway I hope the above helps NY_Resident.
All the best Vincent
Click to expand...
Vanguard is the fund. What is the pension vehicle?
 
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Thanks @North Star
What pension provider gave access to these funds? I am a big Vanguard fan as used them while living in US, but have not been able to find a path to these funds here via a pension vehicle
 
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