PRSA Fund - advice on preserving capital

[Mininv]

Hi,

Quick question to see if anyone has any thoughts on this. I have a PRSA of 2 years (so not a major pot by any means). Its currently in a general consensus fund. I'm going to be moving jobs in the next 6 months from a steady income to self-employed (as well as maybe building a property) so I will have to stop contributions for a while.

I'm concerned at the moment about equities, especially exposure to the US market and (heavily property-weighted) ISEQ. I have a feeling (and Im the first to admit my economics knowledge is sketchy) that there may be a correction around the corner. All those deficits have to catch up with western economies at some stage.

I know timing the market is a bad idea. But Im concerned that a crash might unduly affect me if I'm not averaging in to my PRSA every month.

I'm therefore looking at switching funds temporarily. I only have the option of a cash fund, bond fund, global equity fund, aggressive management fund and consensus fund. The PRSA advisor has recommended cash if I want to preserve capital. Does anyone have any thoughts on that? Or alternative ideas?

(I also have half a mind to switch providers - its a company scheme but Im still paying 4% on contributions - what with LA Brokers not doing 0% anymore, the best seems to be 2% - does anyone think another fund provider might have more suitable options for what I want?).

 

[ClubMan]

How long do you have to retirement? If it's c. a couple of decades then you should think long and hard about investing in low-medium risk/reward funds (including some consensus funds) and should really be considering being something with a higher risk/reward profile regardless of whether or not you will be stopping contributions for a while and sitting on the existing fund. Short term volatility should not be a concern with pension savings unless you are nearing retirement age (and maybe not even then if you plan to roll some or all over into an A[M]RF or whatever.

There are other discussions of low cost PRSA providers including 0%/1% offers for a fixed arrangement fee.

If in doubt get independent professional advice.

 

[Mininv]

Thanks Clubman. Im 30 odd years of retirement so it's not immediately pressing. I wouldnt be envisaging leaving it in a low risk fund on a long-term basis. Probably just over the next 6-9 months.

Ive searched through the discussions for a 0%/1% option but, since LA Brokers stopped doing it, I cant see anyone who's managed to get that. If there is anyone out there who's got a similar deal recently, I'd love to hear from you.

 

[ClubMan]

Thanks Clubman. Im 30 odd years of retirement so it's not immediately pressing. I wouldnt be envisaging leaving it in a low risk fund on a long-term basis. Probably just over the next 6-9 months.

But that's my point. With pensions your really need to forget about short term volatility and with 30 years to go seriously consider sticking it in a high risk/return/equity content fund.

Ive searched through the discussions for a 0%/1% option but, since LA Brokers stopped doing it, I cant see anyone who's managed to get that. If there is anyone out there who's got a similar deal recently, I'd love to hear from you.

CapitalCCC's employer, for one, is doing it for a fixed execution only arrangement fee of a few hundred € if I recall correctly.