Questions to ask your pension company

capital0ne

Here are some very basic questions to ask your pension provider

1 What did I pay in charges and transaction costs last year?

2 How do these fees add up over time?

3 How have fees hit my investment returns?

4 Is there a cheaper fund that offers similar returns?

5 How do I transfer?

These questions were set out by the Government - good luck folks

Silvertabby

capital0ne wrote: »

Here are some very basic questions to ask your pension provider

1 What did I pay in charges and transaction costs last year?

2 How do these fees add up over time?

3 How have fees hit my investment returns?

4 Is there a cheaper fund that offers similar returns?

5 How do I transfer?

These questions were set out by the Government - good luck folks

Good advice - but you missed the bit about applying to DC schemes only.

dunstonh

1 What did I pay in charges and transaction costs last year?

Should appear in your statements by the end of the year due to rule changes. Many already meet that standard

2 How do these fees add up over time?

You are supplied an illustration at point of sale, top up or benefit crystallisation event. Why would you need it again ad hoc?

3 How have fees hit my investment returns?

There is a defined layout coming that matches MiFID II requirements. However, that is not the same as what you are asking here and providers are not required (and may not be able) to answer the question as you have asked it.

4 Is there a cheaper fund that offers similar returns?

It would be a breach of remit for them to answer that.

5 How do I transfer?

Transfers are largely controlled by the receiving scheme. Not the ceding scheme. So, this is an unnecessary question.

capital0ne

dunstonh wrote: »

Should appear in your statements by the end of the year due to rule changes. Many already meet that standard

You are supplied an illustration at point of sale, top up or benefit crystallisation event. Why would you need it again ad hoc?

There is a defined layout coming that matches MiFID II requirements. However, that is not the same as what you are asking here and providers are not required (and may not be able) to answer the question as you have asked it.

It would be a breach of remit for them to answer that.

Transfers are largely controlled by the receiving scheme. Not the ceding scheme. So, this is an unnecessary question.

Ah well, The Telegraph has got it totally wrong again! Please ignore this advice it's totally useless, sorry to have wasted everyone's time. Good luck folks

capital0ne

Silvertabby wrote: »

Good advice - but you missed the bit about applying to DC schemes only.

Surely the questions make that obvious! maybe not I guess, thanks for pointingthat out, but as Dunsty has pointed out it's all a complete waste of time anyway because you're provided with the information on an annual basis and some of it isn't allowed to be given. Good luck folks

dunstonh

Ah well, The Telegraph has got it totally wrong again!

Wouldnt be the first time. After all, its not their area of knowledge.

Currently, pensions and life investments are not captured under MiFID II but the FCA is aligning them with MiFIDII later in the year. It was meant to be February this year but some issues were identified and delayed it.

Providers have to follow regulatory requirements and systems are built and coded to comply with those. This leads providers to provide data that matches the regulatory requirements.

Point 4 was the interesting one as at no point since 1988 have providers been able to answer that as it is an advice/opinion question and not one of fact. The best response you would get from a provider on that one is "here is our funds list".

When IFAs ask the questions that are actually important (which appear to be missing in that list e.g. are there any safeguarded benefits, guaranteed growth rates, guaranteed minimum maturity values etc) usually the providers have that in their standard policy details summary and do not actually give the IFA a personal response. Its just template they use for all policy enquires and includes things you didnt ask for and sometimes ignores things you did ask for.

Silvertabby

Good advice - but you missed the bit about applying to DC schemes only.
Originally posted by Silvertabby

capital0ne wrote: »

Surely the questions make that obvious! maybe not I guess, thanks for pointingthat out, but as Dunsty has pointed out it's all a complete waste of time anyway because you're provided with the information on an annual basis and some of it isn't allowed to be given. Good luck folks

Unfortunately, there are a lot of people out there who don't have the first clue about pensions - including the difference between DC and DB.

I'm retired now, but I was a LGPS administrator when the 'Pension Freedoms' were announced. The media did say that the freedoms only applied to DC/private pension schemes, but the LGPS was swamped with requests for access to benefits under the 'new rules'.

capital0ne

Silvertabby wrote: »

Unfortunately, there are a lot of people out there who don't have the first clue about pensions or the difference between DC and DB.

I would agree with you, but Dunsty seems to say otherwise, here are some of his comments.

"Should appear in your statements by the end of the year due to rule changes. Many already meet that standard"
"You are supplied an illustration at point of sale, top up or benefit crystallisation event. Why would you need it again ad hoc?" So You've been told this why don't you understand what I told you? That seems to be Dunsty's POV on that then.

Ah well, it'll all be okay won't it Good Luck everyone.

AnotherJoe

capital0ne wrote: »

4 Is there a cheaper fund that offers similar returns?

This question makes no sense at all.

1. Most people will have more than one fund.
2. All you can look at is fund returns of the past which as we are endlessly told, past performance is no guide to the future, so you don't know what the performance of your fund will be in the future nor of the "cheaper" fund.
3. Fund A with fees of 2% may have had, in the past (over what period?) similar returns to Fund B which has a fee of 1% . However A may be invested in Japanese small companies and B in Pharmaceuticals. Should I just switch from A to B?

The whole thing is nonsensical phrased as it is.

coyrls

AnotherJoe wrote: »

This question makes no sense at all.

1. Most people will have more than one fund.
2. All you can look at is fund returns of the past which as we are endlessly told, past performance is no guide to the future, so you don't know what the performance of your fund will be in the future nor of the "cheaper" fund.
3. Fund A with fees of 2% may have had, in the past (over what period?) similar returns to Fund B which has a fee of 1% . However A may be invested in Japanese small companies and B in Pharmaceuticals. Should I just switch from A to B?

The whole thing is nonsensical phrased as it is.

A vaguely similar question that would make sense is:

Do you offer a cheaper class for any of the funds in which I am currently invested?

dunstonh

coyrls wrote: »

A vaguely similar question that would make sense is:

That would make sense on SIPPs and a small number of personal pensions as they were exempt from the RDR. So, the possibility of being on old share class does exist. Although that can often mean changing from a bundled contract to an unbundled one and that is not always cheaper (even if the share class is).

We have a couple of dozen people still on bundled contracts using the higher charged bundled share classes as they are cheaper than the unbundled funds with lower charges. (now that is going to confuse some people).