How to choose a Pensions Broker?

[kramer2006]

All,

How would one go about choosing a broker for an executive pension? What criteria should they meet?

Can anyone recommend a broker for this type of pension?

Many thanks.

 

[F. Kruger]

If it is an 'Execution Only'(No Advice) service, there are no criteria. The only deciding factor should be how much they are going to charge for the service. I think this is the type of service you were looking for in a previous post(?).

You decide on the Pension Provider and Funds and tell them to send out that particular proposal form.

Anything other than the above would constitute an 'Advice' transaction and the Regulatory procedures for this should be followed by the advisor.

 

[kramer2006]

If it is an 'Execution Only'(No Advice) service, there are no criteria. The only deciding factor should be how much they are going to charge for the service. I think this is the type of service you were looking for in a previous post(?).

Correct! I'd like 'execution only' because I intend to invest only in market indices. At the moment I'm paying a huge premium for advice that I don't think I need.

You decide on the Pension Provider and Funds and tell them to send out that particular proposal form.

Anything other than the above would constitute an 'Advice' transaction and the Regulatory procedures for this should be followed by the advisor.

So, one doesn't use the services of a broker (for a fee) to obtain the best 'execution-only' pension? Let me clarify: I don't require investment advice (from the pension company), but I would like advice on which pension to choose? Does this make sense?

I would also value advice on winding-up/moving my existing pension plan ...

Best regards.

 

[F. Kruger]

Judging by what you are saying, you need some additional advice, but you can also negotiate that this is transacted on a fee basis. It does not have to be a % of contribution. If the advisor recommends a product he/she has to give you a reason for recommending that product and they would hopefully glean enough information from you to make sure that it is suitable for you.

You know what type of funds you want to invest in so you should look for the company that has the lowest management charge on these types of funds. Most of the companies charge additional policy fees and, for an executive pension, there is a Pensions Board fee of €9.50 per annum.

 

[kramer2006]

Judging by what you are saying, you need some additional advice, but you can also negotiate that this is transacted on a fee basis. It does not have to be a % of contribution. If the advisor recommends a product he/she has to give you a reason for recommending that product and they would hopefully glean enough information from you to make sure that it is suitable for you.

You've hit the nail on the head there and made me realise what it is, in fact, I require:

- a fee-based (once-off payment) advisor with knowledge of all the pension plans in the market

- who can produce a report recommending why a particular pension is for me, and why the others are not

- who will advise me on transferring my existing pension also

Now, the million-dollar question: how much do you think this service would cost me (ballpark figure)? Where would I find such an advisor?

thanks again,
K.

 

[Guest126]

Kramer

Just one thought on this:

• Would you not want to retain the advisor annually, given that the plan that is the best for you at the start may not be the most suitable a few years later due to unusual circumstances (for example Equitable Life which went from a fine, reputable institution to utter chaos over a number of years)?In addition, the most suitable fund for your investments (even within same fund manager) will probably change over the lifetime of your investment - a pension fund is a very long term investment...this year's recommendation may not be the most suitable three/four/five/x years later.

 

[kramer2006]

Would you not want to retain the advisor annually, given that the plan that is the best for you at the start may not be the most suitable a few years later due to unusual circumstances (for example Equitable Life which went from a fine, reputable institution to utter chaos over a number of years)?In addition, the most suitable fund for your investments (even within same fund manager) will probably change over the lifetime of your investment - a pension fund is a very long term investment...this year's recommendation may not be the most suitable three/four/five/x years later.

A fair point, Capital. But I'd be concerned about the costs of this. I don't want to pay for investment advice. I already pay a huge premium for this through my current pension and to be honest, I have found it lacking in any substance. I have gained much more valuable knowledge from reading and looking through AAM, than I have from my "investment advisor". Like I said above, I plan on investing by understanding the available funds and diversifying. I plan on keeping an eye on my fund growth and adjusting as necessary over the years.

What confuses me is the charges. This is where I really need the advice. One particular post on AAM (which I can't locate now unfortunately) asks a specific question about how QuinnLife calculate their charges, how often this is done. But nobody answers the post. The pension company websites I have visited recently do not list any charges on their executive pensions, or at least I can't find them.

In addition, nobody on AAM (from the posts I've read anyway) seems to want to recommend a financial advisor. I downloaded the list of AAs from the IFSRA and was dismayed to see nearly 500 pages of them. I would naturally prefer to appoint an advisor from a recommendation, but I can't find any! HELP!

 

[F. Kruger]

I require:

- a fee-based (once-off payment) advisor with knowledge of all the pension plans in the market

- who can produce a report recommending why a particular pension is for me, and why the others are not

- who will advise me on transferring my existing pension also

This is your Shopping List

I would also add that the Advisor should factor in the cost of handling renewal papers each year.

Now, the million-dollar question: how much do you think this service would cost me (ballpark figure)? Where would I find such an advisor?

To echo the Financial Regulator "Shop Around"