Pension provider comparison

Layo909

Just trying to make sense of a list of pension plans that an IFA gave me, and I wonder if somebody could help.

For example, the Aviva Personal Pension shows that at a retirement age of 60 having put £200 per month into the pension, !the fund value will be £163,000 at 5%, £238,00 at 7% and £354,000 at 9%. First question here is, how much income per year would the 3 different fund values buy? !Second question is, what do the percentages refer to?

In the same document, it states that for the Aviva Personal Pension plan, the commission at proposed age of 60 for a fund of £238,000 will be £2270. So is this the total commission that will have been paid? Or is it an annual charge?

JoeCrystal

Layo909 wrote: »

Just trying to make sense of a list of pension plans that an IFA gave me, and I wonder if somebody could help.

For example, the Aviva Personal Pension shows that at a retirement age of 60 having put £200 per month into the pension, !the fund value will be £163,000 at 5%, £238,00 at 7% and £354,000 at 9%. First question here is, how much income per year would the 3 different fund values buy? !Second question is, what do the percentages refer to?

In the same document, it states that for the Aviva Personal Pension plan, the commission at proposed age of 60 for a fund of £238,000 will be £2270. So is this the total commission that will have been paid? Or is it an annual charge?

Should you be asking your IFA instead? After all, an IFA should answer any questions you may have on this.

The percentage is how much it grows by projected rate. 5% is the fund increased up by 5% every year and so on. As for the income, I would thought it would be mentioned in same document? My illustration seems to work the income as 4.4%, 5.6% and 7% for funds which grow each year at 5%, 7% and 9%. How the section that concerning commission is written out?

Cheers

Joe

Layo909

Having double-checked the document, it gives little or no indication as to what the figures mean, which is why I posted on here. Haven't heard from IFA for a good few months now.

ExpertAdvice

Hi,

The 5%, 7% and 9% are the standard rates that the pension providers use for projection. These rates are never guaranteed but used as an assumption. So, putting £200 per month till the age of 60 with assumption growth of 5,7 or 9%, it gives you a figure of possile growth.

It should clearly tell you in the illustration how much pension these figures would buy you. Also, you should be able to take 25% tax free lumpsum at the age of 55.

From the figure, commission looks like total commission including up front + trail commission till the age of 60. BUt you should confirm it with the IFA.

If he hasn't given you this information in details, then I'm not sure how good the IFA is.

Also, what kind of funds are you looking to invest into? I assume the IFA did a full financial review of yourself before making any recommendations.

jem16

Layo909 wrote: »

Haven't heard from IFA for a good few months now.

As was said in your first thread the IFA may be waiting on you getting back to him/her after giving you some ideas to look at.

Are you planning on getting in touch and going over everything or not?

dunstonh

The IFA should make the recommendation. They may well back it up with evidence of research but the IFA decides. Not you.