Pension Investment Advice

zayn

Hi All
I need some advice from the Experts here. I have a pension setup with Scottish widows by a Financial adviser of Park Row associates since 2006 which only i have been contributing to £150 p/m. The funds were divided as follows

25% Newton Managed Fund
25% Invesco Perpetual High Income Fund
25% Scottish Widows Property Fund
25% Fidelity Special Situations Fund

At the time it was agreed that 25% would be cautious funds and 50% into Balanced funds. I am 38 now and have joined another pension fund with my new employer who contributes a max of £1200 per year. I am contributing £100 per month to this pension for the last 12 months...

What i would like to know is at present i don't believe the scottish widows pension is achieving any significant growth and annual charges are not inline with other providers.

Any advice please ....

kidmugsy

Lord knows what's for the best. For the last five or so years my surviving pension funds have been invested in a mixture of Gold and Silver ETFs, Index-Linked and Fixed Interest Gilts, and Cash. That's done pretty well, but I can't imagine that an IFA would approve. I've since got out of the Gilts and am wondering what to do with all the cash next. Equities, perhaps, but where and what? Pretty much all assets look pricey to me, given that half the world may yet fall into a long and deep depression. Or more than half.

bigadaj

OP, the problem might be that this is an IFA organised pension that sounds like it may not have been reviewed for several years. Have you been getting any any servicing or review from Adviser if you've been paying a trail commission.

Forts thing is to ascertain your current charges, the funds themselves don't look too bad, probably just a case of paying too much currently. Most people would probably consider this to be too UK biased and you need more international exposure.

Fees may be cheaper on your newer pension so potentially look at transferring in if so and you are able.

Linton

Fidelity Special Situations was for many years a star fund beating the FTSE100 index year after year. Unfortunately since the manager Andrew Bolton left it has performed poorly. So I would suggest that you look elsewhere for some higher risk "spice" to provide the returns you need with a long way to go before retirement.

Possible replacement sectors include emerging markets, technology, small companies amongst others, or a mixture.

BLB53

Any advice please ....

The higher charges on this plan will eat up a lot of the growth over the next 20 yrs.

I would seriously look into a transfer out to a low cost sipp like HL or Sippdeal and invest the lot in a low cost tracker eg Vanguard LifeStrategy 80% with costs of around 0.3%.

Linton

BLB53 wrote: »

The higher charges on this plan will eat up a lot of the growth over the next 20 yrs.

I would seriously look into a transfer out to a low cost sipp like HL or Sippdeal and invest the lot in a low cost tracker eg Vanguard LifeStrategy 80% with costs of around 0.3%.

At the OPs age with perhaps 25 years to go before retirement I believe he should be looking at higher volatility/higher return sectors than an 80% equity fund heavily weighted to large global companies mainly in the UK and US.

zayn

Can i do this with Scottish Widows or would i need to transfer my Pension ?

BLB53 wrote: »

The higher charges on this plan will eat up a lot of the growth over the next 20 yrs.

I would seriously look into a transfer out to a low cost sipp like HL or Sippdeal and invest the lot in a low cost tracker eg Vanguard LifeStrategy 80% with costs of around 0.3%.

bigadaj

You'll almost certainly have to transfer out, pension plans are a bit like the banks in so far as they continually update products and older products generally aren't as good, a d are almost certainly more expensive.

Linton is right in terms of diversity and exposure to higher risk and hopefully higher reward investments, my preference is for emerging markets and Asia patticulalry and I'm starting to look at smaller companies more recently. This could be mixed with something like the life strategy fund, maybe half in life strategy or less if you are happy with higher risk.

mania112

zayn wrote: »

What i would like to know is at present i don't believe the scottish widows pension is achieving any significant growth and annual charges are not inline with other providers.

Any advice please ....

Unless i'm misreading this, you're answering your own question.

You're telling us performance is no good and the charges are high.

If you know this to be true, you know what to change.

zayn

So i have two options transfer my current personal pension to my employer contributed pension and confirm the fund choices or transfer out to another provider..

Any other suggestions please..

bigadaj wrote: »

You'll almost certainly have to transfer out, pension plans are a bit like the banks in so far as they continually update products and older products generally aren't as good, a d are almost certainly more expensive.

Linton is right in terms of diversity and exposure to higher risk and hopefully higher reward investments, my preference is for emerging markets and Asia patticulalry and I'm starting to look at smaller companies more recently. This could be mixed with something like the life strategy fund, maybe half in life strategy or less if you are happy with higher risk.

GhIFA

zayn wrote: »

So i have two options transfer my current personal pension to my employer contributed pension and confirm the fund choices or transfer out to another provider..

Any other suggestions please..

Not really, as they are your only options. If you're not happy with the fund performance, then switch the funds, but you also suggest that you're not happy with the SW charges, in which case you'd need to transfer to a lower-charged option. However, we don't know what the charges are on your SW plan so can't really comment any further on that. Given that three of the funds you are in would be classed as "externally" managed by SW you are also likely to be paying a higher level of charge on these.