Main site > MoneySavingExpert.com Forums > Essential Money > Pensions, Annuities & Retirement Planning > New work pension(who to manage my funds) (Page 1)

IMPORTANT! This is MoneySavingExpert's open forum - anyone can post

Please exercise caution & report any spam, illegal, offensive, racist, libellous post to forumteam@moneysavingexpert.com

  • Be nice to all MoneySavers
  • All the best tips go in the MoneySavingExpert weekly email

    Plus all the new guides, deals & loopholes

  • No spam/referral links
or Login with Facebook
New work pension(who to manage my funds)
Reply
Views: 520
Thread Tools Search this Thread Display Modes
# 1
shane100
Old 06-12-2012, 10:55 AM
MoneySaving Newbie
 
Join Date: Dec 2012
Location: salisbury
Posts: 9
Default New work pension(who to manage my funds)

Hi,i have recently seen a financial adviser for some advice on a personal pension and a works pension.The personal pension is with prudential and is a with profits fund,the adviser have told me i could do better by moving it into another personal pension in which he will take a 1% cut from.
As for the company pension which is with friend life(joined with axxa i believe) you have a choice to choose there default fund or choose your own funds from quite a big selection.The default funds are all axxa funds set up as a lifestyle profile medium risk fund,the adviser said i could do alot better if i choose my own funds although there will be a charge for selecting funds that are not with axxa or friends life.As the friends life pension is a work one the adviser can't take a % from it so is going to bill me 200 to 250 per year to manage my funds.My point is do i need to pay the adviser to manage these funds or will they be managed anyway by friends life?,if not would it be better to get a friends life adviser to manage my funds as they can take a % of the pension instead of paying out 200-250 per year to my financial adviser.
cheers shaun

Last edited by shane100; 06-12-2012 at 10:57 AM.
shane100 is offline
Reply With Quote Report Post
# 2
dunstonh
Old 06-12-2012, 11:21 AM
Mega Magnificent Maxi-Meticulous Uber-MoneySaving Magnate
 
Join Date: Apr 2004
Location: Norfolk
Posts: 75,278
Default

Quote:
The personal pension is with prudential and is a with profits fund,the adviser have told me i could do better by moving it into another personal pension in which he will take a 1% cut from.
Most of Prus pensions were adjusted in cost to make them have a bottom line of 1% p.a. (assuming 7% pa growth - they may cost more or less at different growth rates). So, the adviser cost of 1% will be on top of any replacement contract costs.

Quote:
As for the company pension which is with friend life(joined with axxa i believe) you have a choice to choose there default fund or choose your own funds from quite a big selection.The default funds are all axxa funds set up as a lifestyle profile medium risk fund,the adviser said i could do alot better if i choose my own funds although there will be a charge for selecting funds that are not with axxa or friends life.
Alarm bells are now ringing.

The job of an IFA is to tell you where to invest. Not for you select it. FAs on the other hand (pre RDR - ie currently) mostly require you to choose where you invest. This would suggest it is not an IFA you are using but an FA. That would be the first no-no. You should not use tied sales reps.

Next one is a question on why are you paying the adviser 1% p.a. on the basis of potentially doing better (which can be a viable reason) but it is you that is having to pick the investments?

Quote:
As the friends life pension is a work one the adviser can't take a % from it so is going to bill me 200 to 250 per year to manage my funds.
If you are picking the investments then it is you that is picking them. Not the adviser. So, why pay them?

Quote:
My point is do i need to pay the adviser to manage these funds or will they be managed anyway by friends life
The fund house manages the investments within the fund but does not control the investment strategy being used in your portfolio. So, if you pick a UK equity fund, the fund house will manage UK equities. It wont decide how much you have in UK equities vs how much you should have in property, bonds, US equities etc. That is the job of the adviser.

Quote:
if not would it be better to get a friends life adviser to manage my funds as they can take a % of the pension instead of paying out 200-250 per year to my financial adviser.
Friends Life do not have advisers.

I have concerns based on what you have said and given these above. However, I also suspect there is possibly a misunderstanding (possibly the 1% you mention is the total cost and not what the adviser is getting or I could be getting the wrong end of the stick on some points)
I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
dunstonh is online now
Reply With Quote Report Post
The Following User Says Thank You to dunstonh For This Useful Post: Show me >>
# 3
shane100
Old 06-12-2012, 12:21 PM
MoneySaving Newbie
 
Join Date: Dec 2012
Location: salisbury
Posts: 9
Default pension funds

Sorry for the confusing thread,it is a independent financial adviser i am using.He is choosing the funds for me for free but going to charge 200 per year to manage these funds(company pension).Although no price has been set yet of the cost of the adviser to manage my pension funds.

My prudential pension which is frozen,the adviser is going to move it into a better performing pension and going to charge 1%,will he take 1% when the pension mature's or is it per year.

P.S I no nothing about pension's so just asking is 200 a fair figure to charge per year(company pension)from a adviser to manage my company pension funds.
cheers shaun

Last edited by shane100; 06-12-2012 at 12:26 PM.
shane100 is offline
Reply With Quote Report Post
# 4
dunstonh
Old 06-12-2012, 12:41 PM
Mega Magnificent Maxi-Meticulous Uber-MoneySaving Magnate
 
Join Date: Apr 2004
Location: Norfolk
Posts: 75,278
Default

Quote:
My prudential pension which is frozen,the adviser is going to move it into a better performing pension and going to charge 1%,will he take 1% when the pension mature's or is it per year.
It wont be when it matures. It will either be 1% up front or 1% p.a. You need to be clear on which.

If you go in the default fund then you dont need the adviser. The default fund is there for the "lazy" investor. Wont be the best option but will be a cheap option. Using an adviser on a servicing basis for investment advice and going in default fund is a waste of money. If you start to use single sector/focused funds to built a spread of funds then these should be reviewed. Either by you or by the adviser. The adviser will be paid by you to do this.
I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
dunstonh is online now
Reply With Quote Report Post
The Following User Says Thank You to dunstonh For This Useful Post: Show me >>
# 5
shane100
Old 06-12-2012, 10:47 PM
MoneySaving Newbie
 
Join Date: Dec 2012
Location: salisbury
Posts: 9
Default

Thank you for last thread,funds are being chosen by my adviser so should i pay him 200 p.a to manage them or just review them say once a year?
shane100 is offline
Reply With Quote Report Post
# 6
dunstonh
Old 06-12-2012, 11:19 PM
Mega Magnificent Maxi-Meticulous Uber-MoneySaving Magnate
 
Join Date: Apr 2004
Location: Norfolk
Posts: 75,278
Default

Is the pension value big enough to make it worthwhile? Anything less than 10k then use default fund. Anything more than 50k then the adviser can add value. Anything less than that and its probably not worth using the adviser for 200pa but perhaps ad hoc every 4-5 years.
I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
dunstonh is online now
Reply With Quote Report Post
# 7
shane100
Old 06-12-2012, 11:45 PM
MoneySaving Newbie
 
Join Date: Dec 2012
Location: salisbury
Posts: 9
Default

This is a company pension that i am just about to start so should i just choose defaults funds and be done with it.
shane100 is offline
Reply With Quote Report Post
Reply

Bookmarks
 
 




Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

 Forum Jump  

Contact Us - MoneySavingExpert.com - Archive - Privacy Statement - Top

Powered by vBulletin® Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.

All times are GMT. The time now is 6:36 PM.

 Forum Jump  

Free MoneySaving Email

Top deals: Week of 26 November 2014

Get all this & more in MoneySavingExpert's weekly email full of guides, vouchers and Deals

GET THIS FREE WEEKLY EMAIL Full of deals, guides & it's spam free

Latest News & Blogs

Martin's Twitter Feed

profile

Cheap Travel Money

Find the best online rate for holiday cash with MSE's TravelMoneyMax.

Find the best online rate for your holiday cash with MoneySavingExpert's TravelMoneyMax.

MSE's Twitter Feed

profile
Always remember anyone can post on the MSE forums, so it can be very different from our opinion.
We use Skimlinks and other affiliated links in some of our boards, for some of our users.