Pension products from banks?

stringer_bell

I'm considering opening a pension product, the bank have spoke to me and it seems the most convenient way, it's barclays bank and they offered me an aegon pension. Does anyone know what charges? I presume high, but just how high?

I'm a higher rate tax payer (50%) and £20,000 per year will be my contribution

Aegis

What have they quoted you by way of charges? A lot of them will be dependent on what deal Barclays is arranging for you, and you are likely to see a pretty expensive contract when you deal through a bank.

It might therefore be worthwhile speaking to a local independent financial adviser to see what charges they will arrange for a similar plan. They're also likely to have access to some better pension plans than the bank agents, as banks seem to be very slow to catch on to the idea of platforms and wraps even where the charges and available funds are much better for clients.

dunstonh

Barclays pulled out of giving advice a few weeks back. When did you last speak to them?

Banks are the most expensive distribution channel. Aegon have a few contracts. Which version did they offer you? The charges will be based on the version and the amount of commission they are taking (which will be maximum with a bank). Typically, I find Aegon in the top 10 on a like for like basis for costs. The Aegon contract works much better on fee basis where it can be a heck of a lot cheaper.

An IFA can wipe the floor with the banks. So, give a local IFA a call. Insist on fee basis, not commission.

stringer_bell

dunstonh wrote: »

Barclays pulled out of giving advice a few weeks back. When did you last speak to them?

Banks are the most expensive distribution channel. Aegon have a few contracts. Which version did they offer you? The charges will be based on the version and the amount of commission they are taking (which will be maximum with a bank). Typically, I find Aegon in the top 10 on a like for like basis for costs. The Aegon contract works much better on fee basis where it can be a heck of a lot cheaper.

An IFA can wipe the floor with the banks. So, give a local IFA a call. Insist on fee basis, not commission.

It was a few weeks ago, it was from the relationship manager

I think I heard somthing like they take 20 percent, does that sound right?

Would I not be able to do this without an IFA? I mean, go to h-l and deposit money in a stakeholder pension ( does it really need to be invested? )

dunstonh

It was a few weeks ago, it was from the relationship manager

You missed the boat with Barclays then. They no longer give advice.

I think I heard somthing like they take 20 percent, does that sound right?

So, that would be £4000 then. About four times more than an IFA on fee basis.

Would I not be able to do this without an IFA? I mean, go to h-l and deposit money in a stakeholder pension ( does it really need to be invested? )

HL are IFAs. So, asking not to use an IFA but suggesting you use one doesnt make sense.

Using a stakeholder pension for £20k a year would be daft.

And yes, it does need to be invested. You would be silly not to invest it. You wouldnt have investment risk but you would then have shortfall risk and inflation risk. These can be far more damaging in the long run.

Given your comments, I think you need an IFA. Initially you were considering an expensive salesforce driven product. Now you are considering a stakeholder via HL but dont want an IFA despite HL being an IFA and you suggest you dont want the money invested despite it being the best thing to do. You need a bit of training and understanding and an IFA can give you that if you let them.