Case study Pension Retirement options & Costs

[knockshe]

I am about to retire. Mercer, who hold my DC fund, have given me the usual options of ARF, Annuity or combo of same. I guess I'll ask Zurich, Irish Life etc. for quotes. Also, DAVY was suggested - they advise, set up the pension, and manage. Another thought is allocating a portion to property. So, would appreciate suggestions on approach to take, good advisers, providers/managers, and how to assess/compare charges/fees.

 

[ClubMan]

If you can post additional details such as age, marital/dependant status, fund value, pension type (occupational, PRSA, RAC, BOB etc.) etc. you might get some useful feedback here.

 

[North Star]

We had a case recently with a Mercer administered retirement, and on review of the annuity offered we could source an open market annuity that provided an additional annual income of €1,028 per annum on a fund of approx €336k. Be careful with any annuity quotes provided by large pension administrators and always get a genuine price comparison. This is even before the option of enhanced annuity etc.
Most brokers would be happy to provide an annuity quote for little or no charge and we we will do annuity price comparisons at our expense. If you do contact us in relation to this please mention Askaboutmoney.

Also re the ARF, get details on all costs charges etc and ask for the full Mifid Costs disclosure ( which would be available if this were an investment as opposed to a pension).

Last point - and this is so often overlooked, the fund managers you suggest are mostly Active fund managers ( Irish Life say they are passive, but there are good reasons to doubt this) . The international evidence is clear that lower cost passive fund management delivers a better return for the clients. We have done analysis of this in an Irish context ( as have other advisers who post here) and the results in our opinion are compelling in favour of passive investment. Full disclosure - the outperformance of passive versus active may either continue, increase further or decrease in the future. No one knows, but a good starting point is to at least know and understand the history. Come back with more details and I am sure that you will get good info here.

Vincent

 

[Steven Barrett]

We had a case recently with a Mercer administered retirement, and on review of the annuity offered we could source an open market annuity that provided an additional annual income of €1,028 per annum on a fund of approx €336k. Be careful with any annuity quotes provided by large pension administrators and always get a genuine price comparison. This is even before the option of enhanced annuity etc.

I have come across numerous cases of the big scheme providers posting out retirement options and a proposal form for the chosen provider and that's it. No one called or offered advice on investment strategy, having an enjoyable retirement, what they want to do with themselves now they aren't working. The price of this postal service? 4% of the ARF value. Money for old rope for them.


Steven
www.bluewaterfp.ie