PRSA clarification required

V

vue11

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I met with three guys about setting up PRSA, one from Bank, one from Irish Life and one from Eagle Star. NONE of them could confirm costs. They all reminded me of used car salesmen-except guy in bank who didnt try the hard sell. Can someone PLEASE tell me in plain english how on earth I get the 0% and 1% deal.(and what is the catch if any with this deal) And also IF this is any different to the other 5% and 1% offers that the firms are offering. (standard PRSA). All I want is to set a standard PRSA up with (Eagle Star) and get a decent deal. Many thanks in advance.
 
Are you prepared to pay a Fee for an 'Execution Only' PRSA or do you not want to pay anything(ref: your previous posts)?
 
If execution only means that I have to get a broker to pick and choose funds for me and them leave me to it for the next 35 years then no...am no fund manager. Is the 0% and 1% the execution only deal?!!
 
Execution Only means you choose the Pension Provider(like Eagle Star) and you choose the fund/s that you want to invest in.
 
Thanks. Then no I cant do this, I dont have the time or inclination to watch the markets. Is this then the only way to get the 0% and 1%..sorry if this seems like a dumb question. SO basically then the reason we pay the 5% and 1% is for the professionals to choose the funds....I think a clear answer to this one is going to sort me out...cheers
 
You don't need to watch the markets - you just need to choose one or more funds that match your requirements and invest in them. If you are not nearing retirement already then chances are you should be at least looking at a high risk/reward/equity content fund for maximum returns over the next few decades. The only way to get a 0%/1% PRSA is to pay the once off arrangement fee of a few hundred €. If you want advice on what funds might match your needs then you may need to pay more for the advice.
 
The only reason you would be paying the 5% would be for the advisor to recommend funds, at the outset, that would be suitable to your investment objectives and your attitude to risk. The advisor is making the recommendation and it is up to you if you want to take that recommendation.

You are half way there, as you seem to have decided on the Pension Provider. The consensus on AAM is that 'Index Tracking Funds' are the best way to go. Unfortunately, these are not available on the PRSAs that you have mentioned(?). If you have the brochures on the PRSAs, just look at the funds available and if you are in doubt, pay particular heed to the 'Default Investment Strategies' offered. Some of these are pretty good, depending, again, on how much risk you are willing to take.

I do not want to confuse you any further but you may also be able to negotiate reducing the 5% to a lower charge, depending on the level of contribution you are going to make. The 1% AMC is not negotiable.

Hope this helps.

(Post crossed with Clubman)
 
Why not just pay a discount broker 150 or 250 euro to set up a nil-commission PRSA? You will pay 0% entry fees and 1% AMC.

I see that www.labrokers.ie offer two such PRSAs. There are other similar brokers.

You choose the company, you pick the funds. Easy.
 
THANK YOU guys, this all helps a lot. I like that you say I am half way there, half way to madness it feels. Am 31 and so yes am interested in the high risk spread funds for 10 years...but as for choosing them come on! I might as well be throwing darts blindfolded.
 
Protocol, thanks, I am going to look into it, but by setting it up that way, does that mean that for the next 35 years I will on my tod deciding what to do with my funds?!! or have I missed something. Beginning to regret studying media..lol
 
vue11 said:
Am 31 and so yes am interested in the high risk spread funds for 10 years...but as for choosing them come on! I might as well be throwing darts blindfolded.
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A small bit of research (e.g. here on AAM) will help you. Ultimately if you have a couple of decades to go to retirement then you might want to look at a high risk/reward/equity content fund that is well diversified across different geographic regions and sectors. Alternatively pick one or more index tracking funds since there's a strong argument that active fund managers will not beat the indices in the long run. For the latter you could check out the likes of Quinn Life non PRSA pension funds. Obviously this is not all encompassing advice to you but just a general pointer. If you are really clueless then you really should get independent professional advice. But at least start by reading some of the posts and other resources (e.g. the AAM and IFSRA guides to savings & investments linked in this key topics thread) and you may be surprised by how much you can understand/learn on your own.
 
vue11 said:
Protocol, thanks, I am going to look into it, but by setting it up that way, does that mean that for the next 35 years I will on my tod deciding what to do with my funds?!! or have I missed something. Beginning to regret studying media..lol
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Vue11, I don't know exactly what you are asking here.

What I am suggesting is that to avoid the typical 5% entry charge on your pension contributions, you should set up a nil-commission PRSA for a fixed fee.

I mentioned the Eagle Star PRSA, but there are others.

You can have a DIS, or Default Investment Strategy, where the assurer decides where to invest the funds based on your age, etc., or else you pick where your contributions should be invested. Here is the Eagle Star list of possible funds:

[broken link removed]

The younger you are, with more time to retirement, the more equities you should be exposed to, so maybe pick a few funds with high or 100% equity content.

Does that help?
 
I'm 27 and trying to set up a pension/PRSA. The aim is to retire at 50-55.
The dilemma I have is whether to go for advice and have the gains eaten up by charges or go execution only and lose out due to m y ignorance.
I know I want the pension to be with Eagle Star. I don't want to buy an annuity when I retire. A lump sum and an ARF at the end seem the best solution. I don't want to have to manage a fund so is the DIS the best option? Seems common sense...risky now, not so risky down the line.
Any suggestions/observations appreciated...
 
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