Bold leap into retirement

MallyGirl

grimsalve said:

MallyGirl said:

grimsalve said:

I had a chat with an IFA yesterday and I was shocked at the prices he quoted (around £2,000 for their report and then a 3% charge if I decide to go ahead with their suggestions). I'm not sure what to do next.

That will very much depend on your situation and your goals. If you have a nice solid DB pension and have qualified for the full state pension then there may not be much you need to do. You haven't given any information 

I don't have a DB. I just want a nice comfortable retirement so I thought it would be straightforward to setup. I've got a couple more IFAs to talk to though so I'll see what they have to say.

They are going to need to know your goals, assets, commitments. What constitutes comfortable retirement for you could be very different for someone else.

cloud_dog

@grimsalve, it might be worth you starting your own thread as there are a number of very knowledgeable posters on the Pensions forum who may not read this particular thread and may be able offer greater insights etc.

grimsalve

MallyGirl said:

grimsalve said:

MallyGirl said:

grimsalve said:

I had a chat with an IFA yesterday and I was shocked at the prices he quoted (around £2,000 for their report and then a 3% charge if I decide to go ahead with their suggestions). I'm not sure what to do next.

That will very much depend on your situation and your goals. If you have a nice solid DB pension and have qualified for the full state pension then there may not be much you need to do. You haven't given any information 

I don't have a DB. I just want a nice comfortable retirement so I thought it would be straightforward to setup. I've got a couple more IFAs to talk to though so I'll see what they have to say.

They are going to need to know your goals, assets, commitments. What constitutes comfortable retirement for you could be very different for someone else.

I thought that was the point of the first chat?

nicknameless

grimsalve said:

I had a chat with an IFA yesterday and I was shocked at the prices he quoted (around £2,000 for their report and then a 3% charge if I decide to go ahead with their suggestions). I'm not sure what to do next.

Run in the opposite direction would be my advice.  3% charge on your assets will make your retirement decidedly less comfortable, and further away if you are currently accumulating towards it.  I DIY so not intimately acquainted with typical fees but those sound outlandish.  Suppose that might depend on the size of your assets.

Have you no desire to learn and DIY?

grimsalve

nicknameless said:

grimsalve said:

I had a chat with an IFA yesterday and I was shocked at the prices he quoted (around £2,000 for their report and then a 3% charge if I decide to go ahead with their suggestions). I'm not sure what to do next.

Run in the opposite direction would be my advice.  3% charge on your assets will make your retirement decidedly less comfortable, and further away if you are currently accumulating towards it.  I DIY so not intimately acquainted with typical fees but those sound outlandish.  Suppose that might depend on the size of your assets.

Have you no desire to learn and DIY?

Ballpark figure of £500k currently in a SIPP that I'm thinking of turning into an annuity or something similar when I retire just so I get a reliable income of around £20k a year. No dependants, no debts, no commitments, etc. so I thought it would be a very quick and easy job for an IFA with the only questions being a 100% annuity, a percentage split between an annuity and drawdown, or just leave it as a drawdown (and then maybe a quick assessment of risk to make sure it's in the right fund).
By my calculations the 3% fee, plus the report, plus VAT, etc. would be around £20k which seems a bit excessive.
Would it be difficult to arrange an annuity without an IFA?

Reckless_Saving

grimsalve said:

Ballpark figure of £500k currently in a SIPP that I'm thinking of turning into an annuity or something similar when I retire just so I get a reliable income of around £20k a year. No dependants, no debts, no commitments, etc. so I thought it would be a very quick and easy job for an IFA with the only questions being a 100% annuity, a percentage split between an annuity and drawdown, or just leave it as a drawdown (and then maybe a quick assessment of risk to make sure it's in the right fund).
By my calculations the 3% fee, plus the report, plus VAT, etc. would be around £20k which seems a bit excessive.
Would it be difficult to arrange an annuity without an IFA?

Before you decide whether to go the IFA route or not, I’d recommend spending some time self learning to widen your knowledge and open up options, it shouldn’t be a rush.  The Donegans have been doing a great free in depth course on YouTube under the “Rebel Finance School” banner, the playlist to the 2025 course is below should be available till at least January, they do a new version every June.

To complement the course they have a website, course notes and Facebook group with large community willing the help answer questions.

https://youtube.com/playlist?list=PLRjwfVU_qq2ZyjD8p0gh15L-zPZI2WzL1&si=ik5hcwJHVcSBW8C2

https://rebeldonegans.com/finance/rfs/

https://rebeldonegans.com/finance/rfs/course-notes/ 

grimsalve

Reckless_Saving said:

grimsalve said:

Ballpark figure of £500k currently in a SIPP that I'm thinking of turning into an annuity or something similar when I retire just so I get a reliable income of around £20k a year. No dependants, no debts, no commitments, etc. so I thought it would be a very quick and easy job for an IFA with the only questions being a 100% annuity, a percentage split between an annuity and drawdown, or just leave it as a drawdown (and then maybe a quick assessment of risk to make sure it's in the right fund).
By my calculations the 3% fee, plus the report, plus VAT, etc. would be around £20k which seems a bit excessive.
Would it be difficult to arrange an annuity without an IFA?

Before you decide whether to go the IFA route or not, I’d recommend spending some time self learning to widen your knowledge and open up options, it shouldn’t be a rush.  The Donegans have been doing a great free in depth course on YouTube under the “Rebel Finance School” banner, the playlist to the 2025 course is below should be available till at least January, they do a new version every June.

To complement the course they have a website, course notes and Facebook group with large community willing the help answer questions.

https://youtube.com/playlist?list=PLRjwfVU_qq2ZyjD8p0gh15L-zPZI2WzL1&si=ik5hcwJHVcSBW8C2

https://rebeldonegans.com/finance/rfs/

https://rebeldonegans.com/finance/rfs/course-notes/ 

Many thanks for the links. I've not heard of them before. I've watched a few of their videos and they make some interesting points but they seem very Vanguard focused. I'll watch some more of their videos over the coming weeks. One thing I did notice in their pension video, no mention at all of annuities and I'm not sure if putting everything in an index fund would be suitable if you're hoping for a steady monthly income.

nicknameless

@grimsalve

I would echo the post above about looking at some of the freely available info before deciding between IFA and DIY.  I've just retired @53 (3 months ago - tapping this on holiday from the Black Forest!!).  As a couple we are in a lucky position to have some DB provision to draw on in coming years (approx. £20k per annum - very lucky to have).  We also have about £500k mostly in SIPPs, with a small amount in ISAs.  Our investments are split approx. 80/20 equities and bonds, with about 3 years of expenses in bonds / cash ISAs.  Equities all simple global equity ETFs.  Will draw on cash / bonds and rebalance as we go.  Have modelled retirement plans myself with tools that are easily accessible and have spreadsheets of my own to back that up.  Perhaps I don't know what I don't know, but much happier this way than paying an IFA to do essentially the same.

Edited to add that I am pretty sure you could buy a fee only plan for retirement from an IFA / financial planner.  

grimsalve

nicknameless said:

@grimsalve

I would echo the post above about looking at some of the freely available info before deciding between IFA and DIY.  I've just retired @53 (3 months ago - tapping this on holiday from the Black Forest!!).  As a couple we are in a lucky position to have some DB provision to draw on in coming years (approx. £20k per annum - very lucky to have).  We also have about £500k mostly in SIPPs, with a small amount in ISAs.  Our investments are split approx. 80/20 equities and bonds, with about 3 years of expenses in bonds / cash ISAs.  Equities all simple global equity ETFs.  Will draw on cash / bonds and rebalance as we go.  Have modelled retirement plans myself with tools that are easily accessible and have spreadsheets of my own to back that up.  Perhaps I don't know what I don't know, but much happier this way than paying an IFA to do essentially the same.

Edited to add that I am pretty sure you could buy a fee only plan for retirement from an IFA / financial planner.  

Many thanks @nicknameless - I think my biggest problem at the moment is "the fear" - fear of retiring, fear of investing in the wrong funds, fear of not understanding the terminology, fear of running out of money, etc.

MallyGirl

That is all perfectly normal. A bit of time invested in some reading will help you with the basics and that can form a solid foundation for moving forward. At the moment you may not even know the questions to ask, let alone be equipped to understand the answers. That can make the idea of handing it all over to someone else very appealing but it will take a slice out of your future funds. If you can, if interested, get a grasp of the fundamentals then you can DIY or make a better match with an IFA.