Cashing in an Index-lined pension?

rudebhoy

atush wrote: »

I dont' know that fund, but if it is an income maximiser i assume it is invested in equities with a good dividend? If so, I would think the fact it pays an income would mean it could rise and fall alot and the income owuld not be affected.

and the rest is so much lower on the risk scale. What fund chargtes do these have? Do you have any other cash? Would not invest all the 200K if that wasn't the case?

management charges are -

Prudential Prufund Growth 0.90%pa
F&C MM Navigator Distribution 0/75%pa
JPM Multi-Asset Income 0.65%pa
Schroder Income Maximiser 0.75%pa

last 3 can be wrapped up in ISAs, first one can't for some reason.

I should have another 20k which I will keep as cash in my Santander current account, which earns 3% pa.

rudebhoy

jem16 wrote: »

Pity you didn't ask him the critical yield and why he was edging towards a recommendation.




You shouldn't think of each fund in isolation but the whole portfolio averaged out. The last fund has a good yield which is what you're looking for.

However if you're not happy with the risk, then say so to the IFA. He should either explain it to you and/or adjust it to what you are comfortable with.

will be meeting with him again when he has heard back from my current employers pension fund. Will ask him about critical yield then, but my strong instinct from the advice on here and the projections I have done is to leave both pots where they are.

I have told him I want to take less risk than what he has suggested so will see what he comes back with.

rudebhoy

dunstonh wrote: »

In which case, I would consider questioning them. As as I said, there could be reason but typically you use multi-asset OR single sector with manual selection for each sector. Mixing and matching like that by adding a UK equity fund breaks the purpose of multi-asset funds. In the OPs shoes I would like to know why. And given the comments on the occupational scheme, I would be questioning ability.

can you explain that in layman's terms? afraid it went right over my head!

jem16

rudebhoy wrote: »

will be meeting with him again when he has heard back from my current employers pension fund. Will ask him about critical yield then, but my strong instinct from the advice on here and the projections I have done is to leave both pots where they are.

I agree with leaving them as they are. However I was interested in his reasons for recommending moving them.

I have told him I want to take less risk than what he has suggested so will see what he comes back with.

Your average risk may well be about 5/10 with those funds.

However, as dunstonh has pointed out, it's an odd strategy. You've got multi asset funds (JPM) mixed with single sector funds (Schroder) which breaks the asset.

In other words you are paying for the knowledge of a multi-asset manager who decides on the specific percentages that should make up the fund so that it's fully diversified - and then you decide to lump in some more UK equity and increase that percentage from what the professional manager decided would be ideal.

It's worth asking why.