IFA managed pension or not ??

Sony_smartphone

Hi to all,,,, brief intro,,, I am 57 yearold married man, not working because of ill health, I,m in receipt of contribution based ESA and in the " support group". Its safe to say my working days are over.
My wife works part time and is more then happy to continue doing so, she has no pension.
When I was working I was in the company D.B pension scheme, I have read and studied up on all things relating to the transferring of DB or keeping it, the transfere value is 255k as at jan 2017.
We are mortgage free and no dependants, we have 58k in investments (multimanaged) and approx 45k in cash savings,,
After quite a long period of thought I have decided to transfere out of final salary scheme, I understand completely the "guarantees" that I will be losing but with failing health and mobility this is the best decision for me.
I have spoken to IFA, s regarding this decision, one advisor thought it was a bad decision the other two agreed and understood my rationale.
My dilemma is should I let the F.A manage the transfere on an ongoing basis ,,, the charges for this would be,,,,2% of pot to transfere and set up new arrangement, with a 0.75% running cost and then the whatever % cost of the agreed fund charge,,,,, or should I just pay for his advice and transfere to one of the reputable sipps out there, thus saving .75% coming out of the investment pot every month,,,, I was thinking maybe to jump in and let the advisor look after all for a year or two,, then reasses the whole thing again,,
I forgot to say earlier I look after my own investment and I, m aware of the costs and savings of self investing ,,,, I would like some feedback on my thinking

mjdh1957

My late partner had a DB pension and retired on ill health grounds with a terminal diagnosis so was able to receive his entire pension fund as a single tax-free lump sum and still enable me to receive a survivor's pension when he died.

Your situation might be different though

Seabee42

I have to say why would you want a continuing charge that is frankly huge in pension cost terms.

dunstonh

My dilemma is should I let the F.A manage the transfere on an ongoing basis ,,, the charges for this would be,,,,2% of pot to transfere and set up new arrangement, with a 0.75% running cost and then the whatever % cost of the agreed fund charge

Do you service your car or pay for someone to do it?
Do you decorate yourself or pay for someone to do it?
DIY or pay someone. That is a personal decision. If you DIY and do it well you can save money. If you DIY and do it badly then it can cost you far more than the cost of getting it done for you.

or should I just pay for his advice and transfere to one of the reputable sipps out there, thus saving .75% coming out of the investment pot every month,,

And who are those reputable SIPPs that you are thinking of? If you are thinking HL, for example, then the IFA can be cheaper than that. It may be that a SIPP isnt needed and a personal pension is better. That is a cheaper option than a SIPP.

I forgot to say earlier I look after my own investment and I, m aware of the costs and savings of self investing ,,,, I would like some feedback on my thinking

Surprised you are asking the question then.

Sony_smartphone

Thank you for your reply,,,, my situation is different but thanks again:beer:

Sony_smartphone

Hi dunstonh,, thanks for the straight taking feedback,,,you mention that transferring to a personal pension might be a better option,,,could you explain this please,,,, also if I decide to transfer to this "personal pension" would there be a % of pot fee ,, or how do they charge ?

I,m by no means an expert, but I think I could save thousands of pounds if I go directly to another pension provider,,,,ie no ongoing charges and no 2 or 3 % set up fee,,,or am I not seeing or understanding the full picture.

I totally understand that I will have to pay fund manager charges and a platform fee ,, but it just seems to me I,d paying twice for the same thing,,, thanks again for your replies, ,,sorry I didn't respond earlier but I was on holiday,,,:cool:

Sony_smartphone

mjdh1957 wrote: »

My late partner had a DB pension and retired on ill health grounds with a terminal diagnosis so was able to receive his entire pension fund as a single tax-free lump sum and still enable me to receive a survivor's pension when he died.

Your situation might be different though

!,,,,,,, many thanks for your input,,,,but your right my situation is different, ,,thanks again x

ianthy

Based on my own situation I thought long and hard about IFA future fees after my DB transfer is completed. I have split my pot 1/3rd self manage in low risk investments. The remaining 2/3rds will be managed by an IFA with .80% fee in balanced and dynamic investments. I will be very busy over the next 3-5 years moving house, renovating the new house and travelling. Plus managing a small number of investment properties too. The risk and cost of getting it wrong will be more than the cost of the IFA fees. On this basis I am happy to pay for ongoing IFA services.

Yes - you can save money on IFA fees by self investing/managing and many folks enjoy it. For me, it's a case of balance and how I want to spend my time. Also, I plan to review the situation in 4-5 years time and possibly I might be happy to take on the management of full portfolio .