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DB pension transfer - IFA fee

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  • dunstonhdunstonh Forumite
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    But a DB transfer above £30k has to be mediated through an adviser. 

    No it doesn't.   The requirement is to seek and obtain regulated financial advice.  It doesn't require the adviser to facilitate the transfer.

    If Aviva need the IFA’s signature on their transfer-in form, would you sign that, dunstonh.

    It depends on what the form says.  If it is just asking for confirmation that advice was sought then yes.   if it was asking me to take liability for the sale of the Aviva stakeholder then no.   The regulatory requirement is that advisers cannot refuse to confirm that you have had regulated advice.    However, some providers will only accept business on a positive recommendation or only if the adviser is recommending them as the provider and taking liability for arranging that.    

    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • AlbermarleAlbermarle Forumite
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    And Aviva stakeholder pension will accept a DB transfer without either an adviser’s positive recommendation YES nor a signature on their transfer in form. I assume not
    But you have to buy it directly.  You cannot buy it through an intermediary.   Do Aviva still retail their statekeholder pension direct to consumer?

    You can only buy it through Cavendish, I did not realise this changed the situation.

    Standard Life still offer a stakeholder direct.

  • 8370562883705628 Forumite
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    dunstonh said:
    IFA in HL vs VLS60 in Vanguard - 1.1% total difference in fees.

    An IFA would not use HL.  HL doesn't offer IFAs the functionality they need and HL's platform charge is nearly double what IFAs can get.

    so if the IFA was to invest similarly for similar returns - let alone more expensive actively managed funds
    Why are you assuming active managed funds?    Most of the IFAs I know use hybrid portfolios nowadays.  i.e. a mixture of managed and passive.  Not one or the other.  And the cost difference between VLS and the portfolios is ofen very small and in some cases less (i.e. ranging from 0.11% to 0.75% (lower risk being cheaper and higher risk being more expensive due to higher risk assets being more expensive.  The risk level equivalent to VLS60 being 0.28% which is barely different).

    Lower cost does not mean better returns.    Higher cost does not mean better returns.   It is how you invest and what you invest in that matters.  Hybrid can give you the best of both worlds.
    /
    On an individual basis maybe, but by definition for all investors lower costs = higher returns.
  • dunstonhdunstonh Forumite
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    On an individual basis maybe, but by definition for all investors lower costs = higher returns.

    That is completely wrong. A  fund charging 0.6% can return more than a fund charging 0.2%.   Charge alone is not a definition of higher returns.

    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • 8370562883705628 Forumite
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    dunstonh said:
    On an individual basis maybe, but by definition for all investors lower costs = higher returns.

    That is completely wrong. A  fund charging 0.6% can return more than a fund charging 0.2%.   Charge alone is not a definition of higher returns.

    /
    No, you are wrong, as I explained, obviously.
    It's the simple Gotrocks examples the less that all investors pay to invest, the more of the return that all investors keep.
  • grumiofoundationgrumiofoundation Forumite
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    dunstonh said:
    IFA in HL vs VLS60 in Vanguard - 1.1% total difference in fees.

    An IFA would not use HL.  HL doesn't offer IFAs the functionality they need and HL's platform charge is nearly double what IFAs can get.

    so if the IFA was to invest similarly for similar returns - let alone more expensive actively managed funds
    Why are you assuming active managed funds?    Most of the IFAs I know use hybrid portfolios nowadays.  i.e. a mixture of managed and passive.  Not one or the other.  And the cost difference between VLS and the portfolios is ofen very small and in some cases less (i.e. ranging from 0.11% to 0.75% (lower risk being cheaper and higher risk being more expensive due to higher risk assets being more expensive.  The risk level equivalent to VLS60 being 0.28% which is barely different).

    Lower cost does not mean better returns.    Higher cost does not mean better returns.   It is how you invest and what you invest in that matters.  Hybrid can give you the best of both worlds.
    /
    On an individual basis maybe, but by definition for all investors lower costs = higher returns.
    Assuming the returns (before fees) are the same then yes this is the case. 
  • AlanP_2AlanP_2 Forumite
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    dunstonh said:
    IFA in HL vs VLS60 in Vanguard - 1.1% total difference in fees.

    An IFA would not use HL.  HL doesn't offer IFAs the functionality they need and HL's platform charge is nearly double what IFAs can get.

    so if the IFA was to invest similarly for similar returns - let alone more expensive actively managed funds
    Why are you assuming active managed funds?    Most of the IFAs I know use hybrid portfolios nowadays.  i.e. a mixture of managed and passive.  Not one or the other.  And the cost difference between VLS and the portfolios is ofen very small and in some cases less (i.e. ranging from 0.11% to 0.75% (lower risk being cheaper and higher risk being more expensive due to higher risk assets being more expensive.  The risk level equivalent to VLS60 being 0.28% which is barely different).

    Lower cost does not mean better returns.    Higher cost does not mean better returns.   It is how you invest and what you invest in that matters.  Hybrid can give you the best of both worlds.
    /
    On an individual basis maybe, but by definition for all investors lower costs = higher returns.
    That's true, but as none of us are "all investors" but are "individuals" then it doesn't really help much in terms of deciding what to invest in and what vehicle to use for that investment on a practical basis.

    Let's say that every investor, from Warren Buffet downwards, decided that lower cost was the route to chose and they all ended up in the cheapest World Tracker would their returns all be higher than what they are getting now where costs are higher? 
  • Preacher64Preacher64 Forumite
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    You’re stating that it’s mathematically impossible that two different funds, with different charges, will return different rates. 
    You need to re-read the pamphlet on investing that made you such a guru, just to double check.
  • PrismPrism Forumite
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    dunstonh said:
    On an individual basis maybe, but by definition for all investors lower costs = higher returns.

    That is completely wrong. A  fund charging 0.6% can return more than a fund charging 0.2%.   Charge alone is not a definition of higher returns.

    /
    No, you are wrong, as I explained, obviously.
    It's the simple Gotrocks examples the less that all investors pay to invest, the more of the return that all investors keep.
    This would be true if both funds returned the same level of growth but that is not usually the case.
    You are trying to appear to have greater knowledge than a very experienced professional working in the field when you clearly still have a great deal to learn and, in your rampant desire to post in every thread, often provide incorrect or misleading answers.
    Slow down and benefit from the knowledge and experience which is freely and generously given on this forum.
    /
    I'm not "trying to appear" to have greater knowledge because I don't need to, I am stating that the "very experienced professional" is saying a mathematical impossibility.
    I'm more surprised about the obsession of a small number of rampant stalkers to discredit everything I say without rationally explaining why, or giving a single example of anything I have said that is incorrect or misleading.
    How is is mathematically impossible? Funds are not the only things that drive prices. It would be mathematically possible for all funds regardless of charge beat the market. And since nobody is concerned about every investor in the world even in a closed model of 10 investors it would be entirely possible for 9 of them to beat the average and 1 fail to do so.

    The fact is that higher charges do not necessarily get you a worse result. In some sectors and countries you have to pay a higher charge to invest at all

  • grumiofoundationgrumiofoundation Forumite
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    dunstonh said:
    On an individual basis maybe, but by definition for all investors lower costs = higher returns.

    That is completely wrong. A  fund charging 0.6% can return more than a fund charging 0.2%.   Charge alone is not a definition of higher returns.

    /
    No, you are wrong, as I explained, obviously.
    It's the simple Gotrocks examples the less that all investors pay to invest, the more of the return that all investors keep.
    This would be true if both funds returned the same level of growth but that is not usually the case.
    You are trying to appear to have greater knowledge than a very experienced professional working in the field when you clearly still have a great deal to learn and, in your rampant desire to post in every thread, often provide incorrect or misleading answers.
    Slow down and benefit from the knowledge and experience which is freely and generously given on this forum.
    /
    I'm not "trying to appear" to have greater knowledge because I don't need to, I am stating that the "very experienced professional" is saying a mathematical impossibility.
    I'm more surprised about the obsession of a small number of rampant stalkers to discredit everything I say without rationally explaining why, or giving a single example of anything I have said that is incorrect or misleading.
    As said above - you are assuming fund A and fund B return the same amount before fees. Obviously in this case it is a mathematical impossibility for the higher fees to give a higher return.

    But this not not mean it is a mathematical impossibility for fund A, that charges 1% to return more than fund B that charges 0.5% - since it depends what the underlying investments are. If the total retund of fund A is 0.6% more than fund B - then fund A has returned more. 



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