Am I being ripped off?

dunstonh

I have also asked him to justify the RL choice as it was the only option he presented me with and I am invested in only one RL fund.

Based on your comments on this thread, the choice of Royal London appears to be completely suitable.   What fund were you in?

In addition, don't instruct an IFA who makes only one recommendation to you for a product especially a straightforward pension product.

That is not correct.   You would expect the IFA to recommend one option and not give you a choice.   You are not in a position to decide what is best. The IFA is.

Investor67

Thank you both for helping me with this.  I am in the RL Governed Portfolio 7.  RL charge .4 annually.  There is a .1 profit share. Plus the .75 charged by the IFA. The IFA did not provide me with any analysis as to why he recommended this fund as opposed to say the cheaper and better performing Vantage lifestrategy 60. I don't understand this approach as there are other funds out there are just as suitable as the RL GP 7.
I had several small pensions invested in the company plans of previous employers.  None were DB.  He did not do any analysis on these funds to see if I were better off staying with them due to costs etc.  Instead he offered to transfer them to one pot for "my convenience". My pension needs are very straightforward at this stage I told him I wanted to grow the pot and retire at 65. We did not set out to achieve a target income specifically.

dunstonh

I am in the RL Governed Portfolio 7.

That is not a single fund.  It is portfolio of funds.

 RL charge .4 annually.  There is a .1 profit share. 

The profit share if variable and not guaranteed but its typically a 0.135% ballpark

The IFA did not provide me with any analysis as to why he recommended this fund as opposed to say the cheaper and better performing Vantage lifestrategy 60. 

VLS60 is not cheaper.  It is more expensive.     It is also a different risk profile to GP7, although not much in it.

Performance wise, GP7 and VLS60 are very closely matched.There are periods when one does better than the other.  Generally, when markets fall, VLS goes down less and when markets rise, GP7 goes up more.

Putting aside the adviser charge (as that can be turned off/added to all options).   The RL pension is 0.4%.  Mutual bonus gives you around 0.135% thereabouts.    So, that takes you into the 0.265% range or thereabouts.

VLS60 requires you to hold it on a platform.   With Vanguard that would be 0.15% plus 0.22% OCF and 0.05% TC. A  total of 0.42%

4 years ago, platform charges were higher.  So, you would be looking at around 0.3%.  That would take VLS60 on platform to around 0.57%.

I don't understand this approach as there are other funds out there are just as suitable as the RL GP 7.

What I dont understand is why you think GP7 is not suitable.    It is not the best option on the market (which is of course opinion as VLS60 is not the best option either).  However, it is geared for low knowledge investors needing a simple option.

He did not do any analysis on these funds to see if I were better off staying with them due to costs etc.

How do you know that?  It is a mandatory requirement to do a cost analysis against existing plans.   For you to suggest it wasnt done is concerning.     

Investor67

Many thanks donstonah.  This is very helpful.  My complaint with the IFA  is not that the RL fund is unsuitable but that I have been overcharged for his service. He was charging me 0.75% for services that I listed in my post above but he was only providing me with a three page review annually which really said very little. The follow up discussion with him on the review tended to involve him trying to sell me other products which I understand IFAs need to do but that is where my trust in him became undermined especially when he was trying to persuade me to sell a buy to let and went as far as calculating an annuity income on the gross equity without taking account of CGT and the cost of sale. I never asked him to do this and I told him I am not interested in selling.
My complaint to his firm is that he should have been charging me 0.5 since 2016 especially as the RL portfolios are self balancing so he knew from the beginning he would not be providing the rebalancing service which would have justified the full .75 management.
Based on your very helpful analysis above I will stay with RL.

Investor67

As for the analysis of my company pension plans that were transferred to the RL portfolio he never provided me with anything in writing to show this analysis and cost comparison.  I will ask for this as part of the complaint.  I paid him 5k to transfer the funds.  This is separate to the .75% ongoing charge.  I am not disputing the 5k for the transfers as he did this efficiently but I will take a close look at the analysis once I receive it.

TBC15

Best of luck getting 4yrs of fees back. You have used the service for 4 yrs.If you weren’t happy with the service you should have moved end of year one.

fred246

Should have got rid of the parasite much earlier. What I find amazing is the discussion as to whether £2k or £3k is the correct 'going rate' for glancing at a list of investments. It should be much less than that. People need to push 0.5% down. 0.1% is more than enough.