Pension Company vs Independent Financial advice stitch up !

Prism

DJPench wrote: »

Seriously though I do hope you do get that it would be great for you.

Income tax back, so if you pay into pension you get 25pct off your annual tax bill on pension contributions, report that in accounts if you are self employed ?

So if I pay in £3,000 P.A. I won't have to pay tax on that £3,000 ?

If so, that in itself does seem like growth of a kind. A shed load more than interest ever would produce.

The way to look at it is that you pay in £2400. The pension company will claim £600 back from HMRC and add that to your pension to make £3000

If you pay 40% tax you can claim the extra back by reducing your tax bill for that year

DJPench

Ok thanks. I think this must be happening already with the current "poor performing" pension. You know how it is life/work takes a massive chunk of your time and then you have little time to investigate this stuf and it leaves you feeling confused, worried and a bit annoyed in equal measure.

I think I am probably bordering on over cautious (worried/ untrusting) as a personality.

I think I will most likely strip back the poor performing pension contributions to minimum or to £125.00 and pop £125.00 a month in one of those SIPP ones to spread it a bit and read up on cautious investment portfolios> Does pensions like the Cavendish allow you to easily choose a balanced portfolio to invest in spread across relatively unrisky but also possibly underwhelming growth portfolios or do you need to do it stock by stock.. like:

human hair, osterigh eggs, buckwheat, mankini's, marital aids, special oils and quinoa harvests:rotfl:

Sorry not trolling just lightening up a bit.

40pct tax.. in my dreams

DJPench

May have answer my own question..

cavendishonline co uk/investments/fund-research/#tabs-2

MallyGirl

Maybe take a look at Vanguard Lifestyle funds - you choose the flavour to match to your risk appetite and they spread your money across equities and bonds accordingly. More equity correlates to more risk but hopefully also higher returns. A simple one stop shop and easy to understand for the layman.

VLS40 is 40% equity and 60% bonds
VLS60 is 60% equity and 40% bonds - and so riskier than VLS40.

Easy to see how they have performed in the past (although past performance does not guarantee that it will do the same in the future of course)

DJPench

That seems interesting, thanks will check it out VLF.

Initial checks seem that it is more a split investment than a pension exactly.

MallyGirl

A pension is just a tax beneficial wrapper with rules on how much you can pay in and when you can access the contents.
Once you have the wrapper you have to choose what is invested in inside that wrapper. Depending on your choice of wrapper - SIPP or stakeholder or personal pension - you may have many options to choose from or a limited set.
I would do some basic reading as suggested.

Terry_Towelling

I'm a self-confessed financial duffer but am happy to share my understanding of Financial Advisers - which may not be 100% accurate but is probably a reasonable guess.

An Independent Financial Adviser is one who provides advice on financial matters (investments, pensions, savings etc) and you pay them for that advice. What makes them independent is that they are not tied to any particular brand or product or company and so will recommend what is best for you and your circumstances from pretty much anything on the market.

A Financial Adviser (i.e. not independent) may be paid by particular companies to advise on their products only and will presumably get paid some form of commission by those companies if they manage to sell to any customers. It doesn't mean they are bad, it just means they are only trying to sell certain products.

It sounds like you have already chosen the pension provider you want but, because they want you to go through an intermediary to confirm that their product is appropriate for you, you want to find a Financial Adviser who will perform that role and take their fee as a commission from the pension company rather than charging you. Understandable (if I've got it right).

On the other hand, if by saying you know what pension you want, you actually mean you know what investments you want to hold in your pension, then why not open a Self-Invested Personal Pension (SIPP) and buy those investments yourself? It will all be under your control then and you won't have to pay an IFA - but you will have to pay the platform that holds your investments whatever their charges are and you will likely have to pay dealing fees for buying your chosen investments. If you think this is another money-grab then think again because even if you were able to deal with your chosen pension provider directly outside a SIPP you'd still have fund charges to pay out of your investments.

You'd also have no one to blame but yourself if the chosen investments were not suitable for you after all, whereas, if you go through an IFA you would have redress if the IFA did not recommend appropriately for you. Please note that doesn't necessarily mean you get paid compo if the investments lose money (which can happen to any investment) it only applies if the investments recommended were not appropriate for you.

Happy to be corrected if any of this is inaccurate/flawed.

bostonerimus

If you have a DC pension I see no need to get it through a traditional pension company or to use an IFA if you have some basic financial knowledge and common sense. Obviously products like annuities and DB pensions are going require a pension/insurance company who can act as a trustee and send you your check.

dmelife

OP: You are so ill informed and ignorant it is scary. I sincerely hope you do not hold a position of any responsibility or influence.

kidmugsy

dmelife wrote: »

OP: You are so ill informed and ignorant it is scary. I sincerely hope you do not hold a position of any responsibility or influence.

There are diagnostic clues. "Rip off" is one. "Scam" is often another. "Mis-sold" is a strong indicator too. I saw a "giving the finger" the other day.