Best place to hold low cost tracker funds, post RDR

Fatenbread

Hi all,

My wife and I currently have pension pots of £75k and £85k respectively.

Mine is in a Skandia CRA and my wife's is in an HL SIPP.

From 5 April 2014, the HL SIPP will go up to a 0.45% fixed charge, and the first time I change the monthly payment, or fund selections, or make a lump sum payment, the Skandia CRA will switch to a similar charging regime.

Both funds are primarily invested in equity tracker funds. I make contributions of £15k - £25k per year, and my wife makes none as she now has a defined benefit pension at her new employer. I don't need the research services or breadth of investment choices that a SIPP offers - I just want to be able to invest in a range of trackers at the lowest possible annual charge rates.

Question is, which provider (not limited to the two currently used) is the best option for minimising charges to continue these arrangements from 5 April?

Thanks in advance for your wisdom!

dunstonh

It has swung back to personal pensions in many cases.

SkandiaPlatform

Fatenbread wrote: »

....and the first time I change the monthly payment, or fund selections, or make a lump sum payment, the Skandia CRA will switch to a similar charging regime.

Hi - I just wanted to clarify a point of detail regarding the above. Your CRA will not switch to a new charging structure as a result of a new payment and/or switch. You are able to remain in your current charging structure (bundled) for as long as you wish, or you can choose to move to our new (unbundled) structure at any point in time.

If you have an ISA or Collective Investment Account with Skandia your point above is correct - any activity after April will move you to our unbundled charging structure.

Your financial adviser will be able to explain this further, or alternatively please contact our customer service centre.

Michael Barrett
Platform Marketing Manager
Skandia

rethorn

SkandiaPlatform wrote: »

Hi - I just wanted to clarify a point of detail regarding the above. Your CRA will not switch to a new charging structure as a result of a new payment and/or switch. You are able to remain in your current charging structure (bundled) for as long as you wish, or you can choose to move to our new (unbundled) structure at any point in time.

Can you clarify what actions trigger a change to unbundled charging (charge basis 3)?

Is there a deadline for when charge basis 1 and 2 end or can they continue forever?

Is it possible to move from charge basis 1 to charge basis 2 after April 5 2014?

SkandiaPlatform

rethorn wrote: »

Can you clarify what actions trigger a change to unbundled charging (charge basis 3)?

Is there a deadline for when charge basis 1 and 2 end or can they continue forever?

Is it possible to move from charge basis 1 to charge basis 2 after April 5 2014?

For ISA &/or CIA, any fund switch or top-up after 5th April 2014 will trigger a move for the whole plan to unbundled charging (charge basis 3). We are currently writing to all customers who are affected by these changes with full details of what it means for your individual investments.

For ISA &/or CIA, all customers will need to be in our unbundled structure by April 2016. CRA and CIB's can remain in charge basis 1 or 2 beyond 2016 or these customers can also choose to move to our unbundled charging structure.

Please let me know if you need more detail

Michael Barrett

rethorn

SkandiaPlatform wrote: »

Please let me know if you need more detail
Michael Barrett

I've been looking at various documents describing Skandia's implementation of RDR. For example at your website:

Documents/Literature%20Library/SIS/RDR/PDF8201_SIS_AC_Post_R-Day_Scenarios.pdf

Adviser/adviser-support/to-RDR-and-beyond/three-charge-bases/

Documents/Literature%20Library/SIS/RDR/SK8290_Converting_to_AC_Adviser_step_by_step.pdf

I find the descriptions used in these documents hard to follow however.

For the CRA, what I would like to know is whether any of the following actions require a move to charge basis 3:

1) Me (not an adviser) increasing or decreasing the amount of my monthly contribution using your website.
2) Me making an additional one-off contribution.
3) Me changing the fund allocation percentages for my monthly contributions.
4) Me adding a new fund to my portfolio or removing a fund from my portfolio. For example, by switching part of an existing fund into a new fund or by switching all of an existing fund to another fund.

I am happy with charge bases 1 and 2 (fixed fee). If however, I'm limited to what I can do under these bases then I will consider moving to another provider that is cheaper than charge basis 3 (% fee).

SkandiaPlatform

rethorn wrote: »

For the CRA, what I would like to know is whether any of the following actions require a move to charge basis 3:

We do not force a move for the CRA (or CIB) to charge basis 3 under any circumstances. You can instruct all of the transactions you mention and remain in your current charging structure. You are able to request a move to charge basis 3 if you would like to do so, but there is no compulsion.

rethorn

SkandiaPlatform wrote: »

We do not force a move for the CRA (or CIB) to charge basis 3 under any circumstances. You can instruct all of the transactions you mention and remain in your current charging structure. You are able to request a move to charge basis 3 if you would like to do so, but there is no compulsion.

Excellent. Thank you.