Lump Sum Investment Fee

emidsbuyer

I've been quoted 1.75% to transfer 130k and invest a further 190k into a new pension, giving a fee around £5,700. Final figure sounds high although the rate sounds ok given what others have mentioned in the forums. What do people think?

jamesd

What services are you buying for the money?

It's free just to put money into pensions and transfer it around, so if you are being asked to pay money for it you'd need to be getting some service to justify not paying nothing.

emidsbuyer

Sorry, I didn't mention. This was for the initial review of my existing arrangements and full fact find on my finances, research and advice into the new arrangements and then execution of the transfer and investment including fund selection, etc. I'm happy with the advice but wondered on the fee?

dunstonh

If you are using mainstream products/investments then it seems high. Something closer to half that would be reasonable. percentages need to be in context of the amount. 1.75% is great on small amounts but expensive on larger amounts.

JJforever

Does anyone know roughly how much an IFA charges for a straightforward pension transfer?

dunstonh

JJforever wrote: »

Does anyone know roughly how much an IFA charges for a straightforward pension transfer?

Personal Pension, stakeholder pension, SIPP to another PPP, SHP or SIPP is a higher risk transaction but relatively straightforward unless you are employed and have an auto-enrolment scheme.

Occupational pensions are higher risk still and require a specialist licence and that effectively pushes the price up further.

Cost will vary across firms. I would expect quite a lot of variation and wouldnt want to put a fee on it but you would certainly expect it to be in the thousands given the liability risk level.

jamesd

Just to give some context, at the total size you're writing about you'd be easily in the 10% largest pension pots at Hargreaves Lansdown, perhaps the biggest 5%.

With your sort of size you're well into the area where non-percentage fees or hourly rates are likely to be the best deal. Since financial adviser pricing models vary you might find that it's not an option for the one that you prefer to use.

One other thing worth knowing is that it's a busy time of year. Less reason for an adviser to move on charges this month than in say June.

emidsbuyer

Thanks for the feedback, it's extremely helpful. I'll negotiate and see where that gets me.