Is it easy to rationalise and transfer Pensions from Aegon ARC ...do I need an IFA?

Rodders2409

Hello All,

I'm finally at the point, following a long drawn out sale of late fathers property, where I'm needing to review and sort out family finances.

Long story short.
58yrs old
Zero Mortgage
Early retired (carer for better half who has terminal condition)
Living from rental property income, PIP, carers allowance etc..
Have small Savings fund for emergencies, living style is OK with no extravagancies but OK..

Current pensions spread across 3 Friends provident pots (£110K total) with main funds in Aegon Growth Tracker flexible ARC (£310K)

Not intending to tap into them until necessary, probably at 60yrs depending on various and inevitable 'stuff'.

Inheritance now provides cleared funds of £200K, after sorting out home deposits for kids which has been a highlight amongst the other stuff. 

So, I've been sporadically looking at the funds I have and how other perform, but not wanted to change things until things have settled. I'm now considering transferring out of Aegon and rationalising the others at the same time.

I'm also definitely going to get 2 x ISA's set up for us.. 

I know I can extract 25% Tax free from the pensions but don't desperately need it and was thinking that the more I can ;leave in the pot the better the return later. Or...I could extract it and put it into a different investment location.

Question 1
Aegon has a 75 / 25 equity / bond split but has only provided a 9% return over 12mths and 3.8% over 3yrs ....compared to something like..
HSBC GS Balanced - 65/35 split with returns of 15% and 3% over the same.
and 
HSBC GS Dynamic - 80/20 split with returns of 19% and 5% over the same.

Aegon doesn't seem to perform at the same level for similar investment risk (it has a low level of US equities), unless I'm missing something....Aegon costs are 0.45%

Should I consider transferring and is it easy to do myself.

 

Albermarle

Most likely the lower % of US shares is what has been holding back its performance.
Some points to consider.
Presumably Aegon have a wide range of investments to choose from, you could just change your investment profile with them?
In future the US market may start to underperform. This may or may not be the right time to increase your US%.
Friends Provident were taken over and no longer exist, so their old pensions are now under the wing of Resolution ( I think) 
It is probably worth noting that Aegon and Resolution seem to have issues with customer service/poor websites.
Maybe at some point you could look for other providers altogether.

Rodders2409

Thanks Albermarle, 

I had considered looking / changing investments within Aegon...I'll check it out.
If I can select general funds without going into specific stocks, as I'm not qualified to dig that deep, then maybe that's a better route.

Can I ask a basic question.
The Aegon fund is a SIPP and I appreciate its a wrapper of sorts that makes investments on mass, but is it protected or managed differently to the likes of the HSBC funds that I mentioned earlier?

dunstonh

So, I've been sporadically looking at the funds I have and how other perform, but not wanted to change things until things have settled. I'm now considering transferring out of Aegon and rationalising the others at the same time.

ARC is a fund supermarket with around 2000 funds.  Its not a quite a whole of market platform but comparable with a circa 2010 level platform.    So, investment choice shouldn't be an issue for the majority of people.

ARC's software is awful (subjective opinion but one based on experience of many platforms).   Aegon appear to know this which is why they give big discounts on pricing.  

Question 1

Aegon has a 75 / 25 equity / bond split but has only provided a 9% return over 12mths and 3.8% over 3yrs ....compared to something like..
HSBC GS Balanced - 65/35 split with returns of 15% and 3% over the same.
and 
HSBC GS Dynamic - 80/20 split with returns of 19% and 5% over the same.

ARC offers all three of those funds.   So, that is not grounds to move provider.
For the benefit of others not experienced with ARC, in addition to offering the usual UT/OEICs, they also offer their own brand funds.    Blackrock are the fund house used for the underlying funds.

The 75/25 fund is a multi-asset fund with Blackrock funds as the underlying assets. 
Like other multi-asset funds, like HSBC GS or VLS, the fund house chooses the underling funds and the percentages applied to each.      In the case of the 75/25 fund, Aegon have selected to go with a very large UK home bias of 55% UK equities and a very low US equities ratio of 7.47%.    Hence the difference in performance

Aegon also owns brands with a variety of asset mixes, which reduce home bias along with the usual third party multi-asset funds.

Should I consider transferring and is it easy to do myself.

You have given no justification to transfer providers in your message.  Switch funds maybe but nothing that says you need to transfer.  That isn't to say there isn't one but at the moment, you are mixing up returns on a fund with the need to transfer.

In this cycle, US equities has been the stand out performer. Anything with a high US equities ratio has performed well.  UK equity has been poor in this cycle.      However, the previous cycle, US equity was very poor and UK equities were actually quite good.        What will happen in the future is anybody's guess.       There are mumourings that US equity will not do as well under trump as other countries and regions will look to counter the tariffs and it could end up hurting US companies.   Nobody knows in advance.  Only time will tell.  However, historically, global equities vs US equities have tended to cycle alternatively

dunstonh

Friends Provident were taken over and no longer exist, so their old pensions are now under the wing of Resolution ( I think) 
It is probably worth noting that Aegon and Resolution seem to have issues with customer service/poor websites.
Maybe at some point you could look for other providers altogether.

Friends Provident is now under Aviva. They still service plans out of the Salisbury office but under the Aviva brand.  Until recently, apart from the logo, not much has changed.  All documents were the same as before but just the logo changed in the corner.   But for the first time last week, I received some ex FP policy details that were of a new design and looked similar to Aviva (ex CGNU) layout.     I haven't noticed any issues with ex FP apart from the lack of online access.     They have some absolute gems and some out of date plans just as all providers do.  Service out of Salisbury has been perfectly fine though.

Rodders2409

Many thanks Dunston...

Can I pick into the the various points.

Understood that there are cycles of performance and I'm thinking that spreading funds across two different funds with two differing underling profiles, and maybe differing bond holdings would be reasonable thing to do.
Is that something that is normally considered as reasonable?

My reasoning to change provider was simply because I didn't really appreciate I could remain with Aegon and select alternative funds within their offerings. 
Would charges remain the same I wonder?
Are there more cost efficient providers, even directly?

I have three ex FP Pensions...
2off funds .....Av FLC With profits SubFund Series4 - £100K incl Final bonus'
1off fund...Av Managed AP -£17K

Are any of these 'gems' or should I consider consolidating them at the same time?

As always, many thanks for the info'

Rodders2409

Ive just had a quick look at how Aegon 'help' you look at alternative funds etc...they definitely don't seem to want you to change them!

You're guided / forced through stages called "Gates" (4 in total) and apparently you can only pass through but may not return so you cannot see what's really available to carry out a reasonable assessment within their platform.

That's my initial view but welcome anyone's experience would be great.

DRS1

Is this the with profits fund you have?  If so look at page 12 and then see if you can find your policy
hl02001c.pdf

Rodders2409

Thanks DRS1

I have two what used to be Friends Provident with profits pensions I think from previous employers, both are titled...
AV FLC With-Profits Sub-Fund Series 4....one Series 4 the other Series 8.
i have several statements but not the Policy

DRS1

The Guaranteed Annuity Rate would be a very valuable benefit but you would need to find out if your policy had it - from the booklet it seems not all of them did.
The other thing to watch if you were thinking of transferring out is the market value reduction - the admin people ought to be able to say if that applies at the moment (or it may be in one of the statements).  The admin people may also be the ones to ask about any Guaranteed Annuity Rate.

Albermarle

Rodders2409 said:

Ive just had a quick look at how Aegon 'help' you look at alternative funds etc...they definitely don't seem to want you to change them!

You're guided / forced through stages called "Gates" (4 in total) and apparently you can only pass through but may not return so you cannot see what's really available to carry out a reasonable assessment within their platform.

That's my initial view but welcome anyone's experience would be great.

It has been noted earlier in the thread that Aegon are known to have a clunky IT system, which apparently is being upgraded.