Is using an IFA for this likely to give value for money?

genie_g

As per my other posts, my husband and I are in the process of reviewing our retirement planning starting with our existing pension provision.

He is an existing member of a company DC pension to which he is contributing, along with his employer, on a salary sacrifice basis. I am a deferred member of the same scheme.

Currently both pensions are on a 'lifestyle' basis whereby funds are switched as we approach our TRD. Currently all invested in Global Equity (70:30) Index Fund - the Annual Mgt Charge is 0.085%.

As of 6 May a wider range of funds is available for self selection (there is no IFA associated with the scheme). We want to look at whether we would be better selecting some of these funds rather than taking the 'vanilla/one size fits all' option.

He is 51 with an existing fund value of £135k. In addition he has £45k in a personal pension plus DB pensions totalling £11k projected gross pension (after taking 25% cash of about £54k).

I am 46 with an existing fund value of £31k. In addition I have £67k in personal pensions plus a DB pension projected at £3k.

These are the available funds all L&G:

UK Equity Index Fund (0.080% AMC)
World (ex-UK) Developed Equity Fund (0.085%)
All World Equity Fund (0.105%)
World Emerging Markets Equity Fund (0.250%)
Global Equity Fixed Weights (60:40) Index Fund (0.085%)
Global Equity (70:30) Index Fund (0.085%)
Growth Fund (0.118%)
Growth Plus Fund (0.138%)
Consensus Index Fund (0.085%)
Over 15 year Gilts Index Fund (0.075%)
Index Linked Gilts Fund (0.075%)
Investment Grade Corporate Bond - All Stocks Index Fund (0.075%)
Emerging Markets Debt Index Fund (0.200%)
Pre-retirement Bond Fund (0.075%)
Annuity Protection Fund (0.075%)
The Money Fund (0.075%)

Are we likely to get value for money from an IFA advising us on our fund choices for 0.5% annual mgt fee? Or, given that the choice is so limited would they be able to add much value above us doing our own research?

Thanks for reading!

Lokolo

You said as of May 6 there is a wider range of funds available. Is this the "wider" range?

genie_g

Lokolo wrote: »

You said as of May 6 there is a wider range of funds available. Is this the "wider" range?

Yep - that's as wide as it gets!

genie_g

Bump!

Any comments guys?

Thanks.

Linton

Unless you are wanting to take a detailed interest in managing your own investments I see no reason to depart from the default Global Equity 70:30 with Lifestyling.

I believe any reasonable proposal from an IFA would be effectively just a tweak against this. If you want to tweak you could always add a small % of something more risky like Emerging Markets yourself to see what happens.

genie_g

Linton wrote: »

Unless you are wanting to take a detailed interest in managing your own investments I see no reason to depart from the default Global Equity 70:30 with Lifestyling.

I believe any reasonable proposal from an IFA would be effectively just a tweak against this. If you want to tweak you could always add a small % of something more risky like Emerging Markets yourself to see what happens.

Hmm...that was the point of view I was tending towards myself.

Thanks Linton.

Still interested to hear any views to the contrary tho' if there are any.

DavidLaGuardia

genie_g wrote: »

UK Equity Index Fund (0.080% AMC)
World (ex-UK) Developed Equity Fund (0.085%)
All World Equity Fund (0.105%)
World Emerging Markets Equity Fund (0.250%)
Global Equity Fixed Weights (60:40) Index Fund (0.085%)
Global Equity (70:30) Index Fund (0.085%)
Growth Fund (0.118%)
Growth Plus Fund (0.138%)
Consensus Index Fund (0.085%)
Over 15 year Gilts Index Fund (0.075%)
Index Linked Gilts Fund (0.075%)
Investment Grade Corporate Bond - All Stocks Index Fund (0.075%)
Emerging Markets Debt Index Fund (0.200%)
Pre-retirement Bond Fund (0.075%)
Annuity Protection Fund (0.075%)
The Money Fund (0.075%)

Thanks for reading!

These charges cannot be accurate. All these funds have a much higher charge than this. Are there any other contract charges not included?

srcandas

I have the same problem as this with Aegon. I believe these funds are funds of funds and that the accumulated costs may look very unsavoury. They state that these types of percentages relate in part to performance bonuses which they cannot fix.

Sadly the only solution I have found is jumping into SIPPs where you have all the information but of course that means do it yourself.

Genie I tried to get an IFA to help and totally failed. My investments aren't that different in amounts to yours but the only quote I got from an IFA, after approaching 3, was for 3.5% of the pot. However this was accompanied by an example of how I might reinvest a taken pension into a new pension (commission??) but the illustration was erroneous.

Be interested to hear if you do get an IFA to look at it but I guess from comment above perhaps you won't.

Good luck, it is a minefield out there :beer:

genie_g

DavidLaGuardia wrote: »

These charges cannot be accurate. All these funds have a much higher charge than this. Are there any other contract charges not included?

Those are the annual mgt charges. We have been told that they are unbeatable (except by the IFA who misread 0.085% as 0.85%). It is a company scheme for a global blue chip organisation.

DavidLaGuardia

genie_g wrote: »

Those are the annual mgt charges. We have been told that they are unbeatable (except by the IFA who misread 0.085% as 0.85%). It is a company scheme for a global blue chip organisation.

Possibly IBM?

srcandas

Having done a bit of a dig these appear to be heavily discounted funds from a respected fund supplier. They are not as in my case funds of funds from those I have looked at. If there are no other charges and you want funds they look great to me.

Any jobs going at this global blue chip