PensionBee Q&A

Malthusian

Hi PensionBee,

I'm flattered to be asked personally for my opinion, but before I respond, what was PensionBee's last pre-tax profit? Is the company currently self-sustaining on an ongoing basis or is it funded by venture capital?

PensionBee wrote: »

We currently offer an all-in-fee of 0.5% on any amount

Although this is true it should be pointed out that your "most popular" option charges 0.7% all-in. And on the page where customers select which investment option they want, this option has one of those big "Most Popular" gold banners over it, which is well-known to be a great way of inducing customers to not select the cheap option. So while it is true that PensionBee offers an all-in fee of 0.5%, most of its members, according to its own website, pay 0.7%.

PensionBee

Hi Maltusian,

We're not VC-funded. We've had investment money as a fintech startup in the past from private investores but we're close to break-even point and will make a profit next year.
If you like to answer some questions regarding our fees, that would be great. it's in the PensionBee Q&A on this forum or I can DM you if you like.

Jasper
On behalf of PensionBee

Malthusian

In that case I would say that a fixed fee, if it was viable, would represent a good way of differentiating yourself in the current market.

Currently when a novice to pensions comes onto this forum we generally talk about low-cost SIPPs holding low-cost multi-asset tracker funds (e.g. Vanguard or L&G). If PensionBee charges a reasonable fixed fee then they enter that conversation as long as the pension fund is big enough.

I am impressed that the company is on the verge of profitability given that many of its competitors (*cough* Nutmeg) haemmorhage losses and rely on VC money.

PensionBee

Thanks for this, that's helpful!
It's nice you mention a fixed fee, it's has come up quite a lot in conversations I had with various people (advisers, customers with small and big pension pots). It's good to collect as much feedback as possible.
The Tracker plan should be seen as a low-cost option, the Tailored plan should be seen as a ready-made fund style product. They need to be competitively priced, when pension pots of our customers grow overtime and both need to be at the price level of a low-cost SIPP.

I guess part of the reason why we'll be profitable soon is a laser sharp focus on doing that one thing you're good at and do it really well. If you can't focus, you can't make a young company profitable.

I wanted to ask DunstonH on his feedback (I'm sure he had a couple of words to say about this ) but I've just seen he's on a break/gone!

Alexland

Hi

You seem like nice people and I wish you well however I would rather see you run for a few more years before I would consider trusting you with a proportion of my life savings.

My largest pension is running at around 0.36% inc fund fees and my other is now 0.32% total.

For me the platfom price to beat is £180 per year. Given transfer costs it would need to be around £120 per year for me to move.

Alex

PensionBee

Hi Alexland,

No pressure there Alex
I can't do anything on us not being around long. The only thing I can say is that all our pensions are 100% guaranteed by the FSCS if we're not longer around.

On a typical £250k pension, we're looking to come in on similar fees you've mentioned. You've confirmed the price point we should be. Thanks!

Maybe we can say hi when we've been around a bit longer!

Jasper
On behalf of PensionBee

Alexland

Surely your FSCS limit would be £50k?

PensionBee

Hi,
PensionBee pensions are protected by the FSCS for 100% of your pension as assessed and accepted by the FSCS (without upper limit).

Jasper
On behalf of PensionBee

bigadaj

PensionBee wrote: »

Thanks for this, that's helpful!
It's nice you mention a fixed fee, it's has come up quite a lot in conversations I had with various people (advisers, customers with small and big pension pots). It's good to collect as much feedback as possible.
The Tracker plan should be seen as a low-cost option, the Tailored plan should be seen as a ready-made fund style product. They need to be competitively priced, when pension pots of our customers grow overtime and both need to be at the price level of a low-cost SIPP.

I guess part of the reason why we'll be profitable soon is a laser sharp focus on doing that one thing you're good at and do it really well. If you can't focus, you can't make a young company profitable.

I wanted to ask DunstonH on his feedback (I'm sure he had a couple of words to say about this ) but I've just seen he's on a break/gone!

You'll have to ask MSE Andrea about Dunstonh when she's back from holiday next week.


For clarification is there any commercial arrangement between yourselves and MSE/ moneysupermarket, it just strikes me as unusual to start a thread like this to effectively promote one company.


There are no shortage of options when it comes to pensions and whilst I wish you well I can't really see your USP.

bigadaj

PensionBee wrote: »

Hi,
PensionBee pensions are protected by the FSCS for 100% of your pension as assessed and accepted by the FSCS (without upper limit).

Jasper
On behalf of PensionBee

Do you want to double check that?


I understand that you are offering funds rather than with profits type policies so it's likely that the £50k will apply that Alexland has suggested.