Annual Pension costs

Thrugelmir

What's the breakdown of fees. There's often an under appreciation of the charges levied on drawdown products. Comes as a sting in the tail.

daisyrose

I may have made a mistake with the risk. I think it maybe medium to low if that's possible.
The annual admin fee is £525 and the withdrawal fee is £158. Are these fees high? The IFA fee is less than 1% pa and I think that would be reasonable.

sandsy

A withdrawal fee is unusual, especially when someone is old enough to start taking drawdown.

Are you sure the adviser is independent and not linked to the company where the pension is invested?

daisyrose

As far as I'm aware there is no connection between them. How would you know?

dunstonh

daisyrose wrote: »

As far as I'm aware there is no connection between them. How would you know?

An IFA will go out of their way to use the term "independent financial adviser" A sales rep/tied agent or restricted FA cannot use that term. They may try to use other words that give the impression but they must never refer to themselves as an IFA.

So, what does the letterhead say? Or their website or business card?

daisyrose

Thank you for explaining the difference. I have looked at letters and the website. The only reference I can find is fca.

dunstonh

daisyrose wrote: »

Thank you for explaining the difference. I have looked at letters and the website. The only reference I can find is fca.

If you cannot find any reference to independent financial adviser then that usually means they are not. It is not an uncommon outcome. Research done some years back found that over half of people seeing a sales rep/tied agent or restricted FA thought they were actually seeing an IFA. We have seen it on this board often too where someone makes reference to their IFA and it turns out they are an FA.

Do they refer to themselves as Wealth Management? Those that do tend to be expensive and often restricted to using just one DFM investment manager on a single investment platform. 2.6% is certainly in that territory.

daisyrose

I couldn't find anything that mentioned wealth management but financial planning/planner is mentioned.This company dealt with my employers and managers. Everyone spoke very highly of them and I have not had any problems but.... it seems that I should have researched better. So if they are not ifa's do you recommend finding an ifa asap?

dunstonh

daisyrose wrote: »

I couldn't find anything that mentioned wealth management but financial planning/planner is mentioned.This company dealt with my employers and managers. Everyone spoke very highly of them and I have not had any problems but.... it seems that I should have researched better. So if they are not ifa's do you recommend finding an ifa asap?

General rule of thumb is that an IFA is better than FA. IFAs are whole of market. Whereas FAs are restricted. Restrictions can be minor or can be significant.

If you can find better value and get as good service then you should go for it. You are paying over the odds. That appears to be the primary issue here. Quality of service is not an issue.

daisyrose

Is there a register where I can find a ifa in my area? We have been satisfied with the service received but the cost is the issue especially if it will eat into the pension as I thought it might.Thank you for all of the help.