Past performance is no guide to future returns. Why is your accountant recommending this specific pension provider and product/fund?My accountant has advised me to put some of my tax into a pension asap. He recommends a Standard Life Manager of Manager funds (Balanced Multi-Manager). From looking on the web it seems to have performed fine over its last two years (only started 2 yrs ago).
Those charges sound high to me on the face of things. Especially when you should be able to get a pension with no charges other than an annual management charge of c. 1% easily enough (e.g. through a discount broker). Just read a few of the many existing threads on pensions and charges. Of course if you can identify tangible benefits accruing from higher charges then maybe they are justified but I would be skeptical about the charges above being worth it.My question is though: how do the fees etc. compare:
96.5% of contribution invested
Mgt Fees 1.35% p.a. (slightly above normal to account for extra layer of Managers - as its a manager of managers fund)
Commission of 5%
You mean 10% of each contribution is going on charges!?!My allocation/spread with New Ireland is 95%/5% so yours looks better.
Yes - QL for example. They only sell direct and not through brokers. But you can also get pensions/PRSAs with just an annual management charge of c. 1% and no other charges through discount execution only brokers. There are loads of threads on this already.I wish there was a direct pension provider which you could get like Rabodirect or Quinn Life which didn't require you to go through a broker. Anyone have any ideas on that?
The allocation rate and commission charge quoted by Lobby would indicate that there are also exit penalties on this contract. So if Lobby wanted to transfer this fund to another provider in the first few years, they would get hit with a penalty.
I presume that the accountant is the advisor is this case and that is they who will be receiving the commission. Are they offsetting this commission against your accountancy fees or is the 5% in addition to your normal fees?
The management charge quoted is correct for this fund, so there is no 'trailer' commission attached.
Some Brokers do sell Quinn Life Products and would charge a fee for setting it up or for any advice that might go along with the transaction.
Yes, the accountant is the advisor and I'm not aware that they are offsetting any commission against the tax return charges.
I still find this confusing - their bumpf says they don't "use" (although the term used may be different) brokers but you (and I have no reason to doubt you!) say otherwise. I think we discussed this in another thread. Either way my main point above is that you can get better (e.g. 0%/1% style) pension charges deals elsewhere - e.g. direct or through discount brokers.Some Brokers do sell Quinn Life Products and would charge a fee for setting it up or for any advice that might go along with the transaction.
The management fee looks a bit high. I have one with New Ireland and it's .75% but it depends on the fund. There are some more specialist funds which have fees between 1 and 1.5%Neil
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