PRSA advice

T

Thecaddie

Registered User
Messages
15
Hi,

I have a PRSA value €225K which was setup in 2012 as a result of me leaving employment and opening up a PRSA to invest my accumulated pension contributions.
Since opening there has been no return on this investment which considering the movement in the market over the past 6 years seems very poor performance.

I am considering changing the investment. The current investment is split 50/50 between GARS fund and a multi asset portfolio.

I am age 43 and have another pension with existing employer which I am paying 19% contribution into.

My question is at my age should I be conservative with the PRSA or move into more equity exposure with a higher risk rating?

The return on the PRSA has been very poor but I am also concious of the potential for a correction in the markets soon. Should I be worried about this or think of a 15-20 year horizon?
 
Standard Life's GARS fund is an absolute return (aka hedge) fund that has not performed well (to put it mildly) in recent years.

If I was you, I'd switch to simple equity and bond funds (or a balanced fund containing both asset classes), in whatever combination you are comfortable with, having regard for the allocation within your occupational pension scheme and any non-pension assets/liabilities.
 
Thanks Guys.

I just checked my documents and I invested in the standard life funds in June 2015 (MyFolio Active 3 and GARS 50:50). I had previously had the funds with Zurich equity funds which performed very well 2012-2015.

I am very set on your advice to move out of the GARS fund and understand and can make transfers to other Standard Life funds (max 5 p.a.) without incuring any charges.

@ Marc is your point that I should be able to transfer out of this policy altogether to another provider without penalty?

At present I am thinking of switching the My Folio Active 3 fund to the My Folio Market 3 fund (less fees and has no GARS exposure) and putting the rest into various equity funds with Standard life e.g. Vangaurd global equities and Standard Life smaller companies.
 
Yes I did notice that. The VG global equities has 0.6% added. I didnt check the others but the smaller company fund charges are high at 1.55%.
 
Yes you can transfer from one PRSA to another with a different provider with no initial charge. You'll just pay the ongoing annual charge. There can be no penalties on PRSAs for early surrender. That said, before switching you should be clear on what you hope to achieve. It's true that the annual charges for a PRSA where the provider is charging for both the fund management and the PRSA administration all rolled into one (e.g. Standard Life) are high relative to the charges you could get just buiying the fund alone elsewhere, this is of academic interest only. Even if you transfer to a self-administered PRSA and can buy the funds at lower annual cost, you still have to pay annual fee just for having a PRSA and you may also have to pay a separae fee to the advisor for advice and implementation. The all-in annual fee quoted by the likes of Standard Life and Zurich Life includes fund charges, PRSA administration and if you're transferring to a different provider, the adviser fee.

Regards,

Liam
https://ferga.com/
 
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