Advised to switch pensions again by advisor

JoeD89

Hi there everyone,

I'd welcome some advice on this topic, as I'm a little concerned... just over 12 months ago my financial advisor advised me to swap my pension from provider A to provider B. Given I trusted his judgement and the fact that the new fund was supposed to be more flexible, I went with his advice. Over the past year, I have not seen much growth in the fund, aside from my regular monthly contributions. I have now been advised that I should transfer again, to Skandia - on the basis of much better flexibility in fund selection.

My concern is the costs which I'm incurring as a result of these multiple swaps and additionally, given the modest (poor) growth of the last 12 months within my current fund. I appreciate that my pension pot is not as large as some of my FA's clients, but still feel it warrants some attention.

Does anyone know of what kind of renumeration a FA would receive from swapping pension providers?

Many thanks in advance,
Joe

opinions4u

Are you using an IFA or an FA?

ChesterDog

Just out of interest, did the same advisor suggest A in the first place, before moving you to B and now C?

JoeD89

Yes, I'm using an Independent FA. Additionally, my first pension fund (A) was recommended by the IFA.

warwicktiger

Ask him to do the new switch on a commission free basis

ChesterDog

warwicktiger wrote: »

Ask him to do the new switch on a commission free basis

That sounds like an excellent idea to me.

bigadaj

OP the fee for this should, be declared to you in any case and should be on the signed documentation, if you don't have it then ask for it or get another copy.

The ifa should also be clearing describing the benefits in these moves, frequent switches don't sound good to me, at least not good for you, possibly for the advisor.

jem16

JoeD89 wrote: »

Does anyone know of what kind of renumeration a FA would receive from swapping pension providers?

The remuneration that your IFA would receive is something you have to agree with him and something which should be clearly laid out to you before you even start.

Much also depends on whether your relationship is as a servicing client or a transactional client. If servicing a change of pension provider could be done as part of the servicing package but with transactional you would expect to pay for any work done.

With any change of providers, there should be a clear reason why a new provider will be better for you than the old. It has to be justified and not just changed.

How large is your pension pot?

warwicktiger wrote: »

Ask him to do the new switch on a commission free basis

IFAs have not been allowed to accept commission since January 2013.

nrsql

Have you made use of the extra flexibility in the last year?
Do you expect to make use of the extra flexibility with the new provider in the near future?

If not then I would ask your IFA how this would benefit you.

warwicktiger

jem16 wrote: »

The remuneration that your IFA would receive is something you have to agree with him and something which should be clearly laid out to you before you even start.




IFAs have not been allowed to accept commission since January 2013.

OK then, a fee free basis for any extra work in switching, just pay ongoing fees if and as originally agreed.

dunstonh

Does anyone know of what kind of renumeration a FA would receive from swapping pension providers?

It will be whatever you agree to pay them. There has been a lot of changes over the 18 months and contracts are cheaper. Personally, I am not moving anything from a year ago as the contracts available now are generally the same as then. However, I have been reviewing older ones on servicing clients and moving them where required. In those cases, I would charge the transactional clients an ad hoc fee to do the work but not charge the servicing clients as it falls under part of their servicing.

So, you need to ask what the charges are. The fact you dont know is a concern.

Ask him to do the new switch on a commission free basis

That is the default position as no commission exists.