The cheapest PRSA?

Discussion in 'Pensions' started by Brendan Burgess, Aug 17, 2003.

  1. Brendan Burgess

    Brendan Burgess Founder

    Posts:
    32,406
    The Best Value PRSA?

    www.myadviser.ie will set up a New Ireland PRSA on a nil commission basis for a charge of €50. 100% of your contributions will be invested, so the only charge after that will be the 1% annual management charge.

    Any similar good deals out there?

    Brendan
     
  2. Joey

    Joey Guest

    PRSA'

    Why New Ireland?
     
  3. Savy

    Savy Guest

    PRSA!

    Joey,
    It must be an offer that New Ireland are doing.

    I'm actually purchasing this PRSA.


    There are some good personal pernsions available on his site aswell, but PRSA flexibility is the key for me

    Savy
     
  4. Brendan Burgess

    Brendan Burgess Founder

    Posts:
    32,406
    Re: PRSA!

    Savy

    What other PRSA options did you look at?

    Brendan
     
  5. Savy

    Savy Guest

    PRSA

    Brendan,
    I looked at Eagle Star,Canada Life,Friends first,Hibernian,Irish Life and even New Ireland.

    I had almost decided to go with the special offer of the personal pension from myadviser.ie(comparable to the occupational pension I was in-which I considered good).

    I needed to be able to modify my payments fairly regularly and I thought that without the 5% entry charge drag on performance that this was the best PRSA plan. I certainly haven't seen yearly management fees of less than 1%. Have you?

    Savy.
     
  6. Joey

    Joey Guest

    PRSA

    If you could have bought the same policy, ie 1% management fee, from any of the other providers mentioned would you have done so?

    On a like for like basis, what was the attraction of New Ireland? Was it service? Was it their Default Investment Strategy? Was it their past performance?
     
  7. Savy

    Savy Guest

    PRSA choice

    It was a number of things Joey.

    no 5% entry fee on premiums paid.

    For the year 2002 they had the second highest return(!!)
    of -13.7% (average return was -18.9%)

    Over the last 5 years they have had one of the best annualised return at 5.6%(Average was 2.4%)

    Savy
     
  8. AmandaC

    AmandaC Guest

    Nil Commision Pensions

    Eagle Star also appears to have a similar "nil commission" pension with only the 1% annual charge.

    Has anyone taken this out or know what the difference is between this and the New Ireland one?

    Thanks


    Amanda C.
     
  9. Savy

    Savy Guest

    PRSA

    AmandaC, where did you see this offer?
     
  10. AmandaC

    AmandaC Guest

    Pension

    We are in the process of setting up our PRSA in work and are getting brochures, etc. sent out. In the Eagle Star one that was sent out, it did not mention the Nil commission one, but one of the other staff members got details on it. His wife works in the pension industry and was advised that there were two with nil commission, the New Ireland one and the Eagle Star one. But he has taken the folder home to read through it and I wont be back in work till next Tuesday. So I will post details then.
     
  11. Merlin

    Merlin Guest

    Re: Pension

    The Pensions Board have added this spreadsheet which has details of the charges on every PRSA available
     
  12. Savy

    Savy Guest

    PRSA charges

    Nice one Merlin.

    It looks Eagle Star have a standard prsa with 0% entry charge and .75% yearly charge(1% if with SuperCAPP)
     
  13. Conan

    Conan Guest

    PRSAs

    I think you will see from the Pensions Board website that most providers have Standard (and non-standard) offerings with no Premium Charge (no 5%). The only charge on these offerings is the fund management charge, varying from 0.75% to 1%.
    These offerings are, I think, non-commission, execution only versions where clients get no advice. For clients who know exactly what they want and need no advice/guidance, these versions are fine.
     
  14. Savy

    Savy Guest

    PRSA

    Conan,
    From the spreadsheet given I can only see Eagle Star
    offering a PRSA of .75% annual management charge+0% entry fee

    Savy
     
  15. MyAdviser

    MyAdviser Guest

    Re: PRSA

    Hi, all sorry for not replying sooner but I have been a bit up to my eyes.

    No PRSA Provider is selling a Standard PRSA for nil commission unless it is via a intermediary. I am not aware of any intermediary that is selling them for less than MyAdviser i.e New Ireland for just 50 euro and any other Providers PRSA (who sell via Brokers) for 100 euro. You get nil commission terms i.e. no 5% entry charge, for the life of your pension. There is no advise or service with this but then you also may not need these supports.

    The reason why New Ireland is on a lower fee is because there is a general offer with their pensions where there is no fee or commission on any Executive or Personal Pension taken out with them. You get nil commission terms and it costs you nothing. I get a volume bonus on business placed on these contracts but not on the PRSA business. (as detailed on the web site) I felt that I should make the PRSA a bit cheaper just to fall into line but needed to be piad for executing the business.

    Charges is not a discriminator for Standard PRSA's. Service may be but it is hard to sell this. Past Performance is a key one for me but I know there are others who feel it is a poor measure. Fund choice may make the difference - Standard life are offering their Non-Standard PRSA at Standard Rates and thus allowing their With Profits fund to be accessed at very low cost.

    One final point is that if the level of flexibility on PRSA's is not everything to you and you can access pensions at nil commission rates (MyAdviser - excuse the plug Brendan)
    it will probably cost you less to set up a personal pension or executive pension. The reason is the annual management charge of 1% can be reduced to 0.75% and this makes a major difference for longer terms and larger investment amounts. In most cases nil commission standard prsa's can be beaten on charges by nil commission exec or personal pensions. flexibility is not everything.

    I hope this helps.

    Regards Michael

    Authorised Advisor & Discount Broker
    www.myadviser.ie
     
  16. ClubMan

    ClubMan Frequent Poster

    Posts:
    43,764
    Re: PRSA

    Interesting info.

    One final point is that if the level of flexibility on PRSA's is not everything to you and you can access pensions at nil commission rates (MyAdviser - excuse the plug Brendan)...

    Not meaning to be picky/pendantic but I guess that should be "for example - MyAdviser" - i.e. other intermediaries, not just MyAdviser, may offer similar terms? No harm in flagging the fact that you offer this sort of deal as long as it's clear that others may do so also (if that is the case). Apologies for labouring the point! :eek:

    it will probably cost you less to set up a personal pension or executive pension. The reason is the annual management charge of 1% can be reduced to 0.75% and this makes a major difference for longer terms and larger investment amounts. In most cases nil commission standard prsa's can be beaten on charges by nil commission exec or personal pensions.

    This is very interesting and seems to be a distillation of the very point I have been trying to tease out for a long time now.
     
  17. Jilly

    Jilly Guest

    Re: PRSA

    In relation to Personal Pensions V's PRSAs, are there any restrictions on the term that the policies must be in force so as to avail of the favourable terms on Personal Pensions?.

    Do all Personal Pension Plans have additional costs, such as policy fees?
     
  18. MyAdviser

    MyAdviser Guest

    Re: PRSA

    Jilly, the short answer is there is no required term. Each case is different but if you have a long term to retirement (15 year plus) and are making a significant contribution to your pension then the Personal Pension will be better value. That said, we are not talking about huge amounts so you need to weigh up the extra flexibility of the PRSA against the lower cost on the Personal Pension. Either way at nil commission and virtually no fee you are doing better then most.

    Most Personal Pensions have policy fees but some do not. It is important to view costs together. PRSA's have 100% net allocation (via MyAdviser’s offer and possibly others) and most Personal Pension's do not but the impact of the lower annual management charge can more than make up for it.

    Regards Michael Kiernan

    Authorised Advisor & Discount Broker
    www.myadviser.ie
     
  19. joe

    joe Guest

    Eaglestar pension as listed on website does not exist ??

    Maybe I misunderstand something here but I rang eaglestar about their pension as shown on the pensions board list - the one with 0% contribution charges and 0.75% and was told that this was incorrect that there was a 95% contribution rate (which equates with 5% charges I presume) and a 1 % management charge.

    I was also told that "you get nothing for nothing these days - it used to be a 50% contribution charge" !!!

    Does this PRSA exist or not ?
     
  20. ClubMan

    ClubMan Frequent Poster

    Posts:
    43,764
    Re: Eaglestar pension as listed on website does not exist ??

    I thought the point was that you only get such deals (e.g. 100% allocation rate, 0.75% p.a. management fee) if you go through, say, an execution only intermediary possibly paying a single agreed up front flat fee directly to them (e.g. €50 - €100 or something in that ball park)? If you go to the underwriter directly then you may face other charges or a lower allocation rate etc. as seems to be the case here?