FSAVC help needed

elsien

I've got an FSAVC (formerly colonial, now winterthur) with management charges of 4.25%. This seems high to me, so I'm wondering whether to transfer to a stakeholder scheme. Do these have cheaper charges, and if I go to an adviser, are there any specific qualifications I should ask them to have? I looked at the unbiased site, but I didn't know what any of the pensions qualifications meant!
Any advice / suggestions would be greatly appreciated.

Thank you

dunstonh

I've got an FSAVC (formerly colonial, now winterthur) with management charges of 4.25%

Are you sure that they are that high? That wouldnt match my experience with old colonial plans (not that I have seen a great load over the years. About 2 in the last 3 years). It could be capital and accumulation units. Normally one would have higher charges than the other. Although a full and proper analysis should be done to make sure. This is usually achieved by comparing the projections until selected retirement date against modern plans.

so I'm wondering whether to transfer to a stakeholder scheme. Do these have cheaper charges

A stakeholder pension is the low budget option. Whether it makes it suitable for you though is another matter.

and if I go to an adviser, are there any specific qualifications I should ask them to have?

No. Personal pension transfers require no specific qualification other than what is required to be an adviser.

I looked at the unbiased site, but I didn't know what any of the pensions qualifications meant!

Ignore the qualifications filter. It is highly flawed and eliminates whol groups of advisers without reason. often leaving you with no advisers left to choose from. Main reason is that there have been a number of different qualifications over the years and if you specify one qualification, you eliminate all those holding the others even though they are to the same level.

It was a nice idea in theory to have the filter but in reality its a disaster in its current form.

phyllis13

I used to work for Colonial, then Winterthur.
As 'Dunstonh' implies, 4.25% management charges are unlikely. You should contact Winterthur in Basingstoke to clarify exactly what you're being charged for the plan.
You should then seek advice from an IFA who will compare the options available to you after finding out your circumstances and expectations in retirement. This may result in the plan being transferred.
An adviser may find a plan that charges less, but this may not necessarily be a better option. More important is the choice of funds available for investment, and the performance of your chosen fund/s, as well as the timescale over which you have to invest until your planned retirement etc.

HTH

elsien

thanks , but its definitely 4.25%, I phoned up this morning to check. (the rainbow managed and equity funds). I thought about a stakeholder because of the flexibility - being able to chuck money in as and when, but I think you're right, I probably do need an adviser, as I have no idea how to best compare the different options.

dunstonh

I thought about a stakeholder because of the flexibility - being able to chuck money in as and when, but I think you're right, I probably do need an adviser, as I have no idea how to best compare the different options.

Flexibility is an option that exists on stakeholder, personal pensions and SIPPs.

Stakeholders have the benefit of a defined charging structure which may or may not be lower than the alternatives available but you will know exactly how it is charged. Problem is that this is now generally viewed as a budget option and the fund selection with most providers can often be limited at best.

A failing with pensions isnt that the products are poor but that people dont seem to treat pensions as investments. If people had the same amount in the bank they would take more care of how it was invested but because its in a pension it gets ignored.

The better investment options come with the personal pensions and SIPPs but if you are very low risk (or post retirement age) then stakeholders can still have a lot to offer.

I am still not convinced on that annual charge. It sounds more like a bid/offer spread or a capital/accumulation units charge where one side gets higher charges and the other side gets lower.