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Nest Pension & New Vanguard Charges - Other options?
Hal17
Posts: 328 Forumite


I want to help my daughter increase her pension funds. Having previously helped her with a house purchase, the next step is pensions.
She has just started a new job with the Church of England and has joined their own pension scheme.
She has a Nest 2047 Retirement Fund which is currently not being added too. She has a Vanguard Sipp which has about £8K at the moment, which I have been funding. We have just decided to move the Vanguard Pension to her Nest Pension due to the recent Vanguard charge increase.
I am not familiar with the Nest set up in terms of available funds, there does not appear to be many choices.
However, I noticed that it is easy for 3rd party contributions via a debit card, and on-going charges of 0.3% after a 1.8% contribution charge.
So for me this would be easy to make contributions to the Nest pension. What I am not sure about is if Nest is a good option considering there are not any employers contributions?
She has just started a new job with the Church of England and has joined their own pension scheme.
She has a Nest 2047 Retirement Fund which is currently not being added too. She has a Vanguard Sipp which has about £8K at the moment, which I have been funding. We have just decided to move the Vanguard Pension to her Nest Pension due to the recent Vanguard charge increase.
I am not familiar with the Nest set up in terms of available funds, there does not appear to be many choices.
However, I noticed that it is easy for 3rd party contributions via a debit card, and on-going charges of 0.3% after a 1.8% contribution charge.
So for me this would be easy to make contributions to the Nest pension. What I am not sure about is if Nest is a good option considering there are not any employers contributions?
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Comments
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How much does she have in Nest?Have you considered the reverse, moving the Nest pension into Vanguard? Depending on the size of your planned contributions and the current fund value, paying 1.8% then 0.3% isn't obviously any better than paying £48pa (then 0.15% once over £32k).N. Hampshire, he/him. Octopus Intelligent Go elec & Tracker gas / Shell (now TT) BB / Lebara mobi. Ripple Kirk Hill member.
2.72kWp PV facing SSW installed Jan 2012. 11 x 247w panels, 3.6kw inverter. 33MWh generated, long-term average 2.6 Os.Not exactly back from my break, but dipping in and out of the forum.Ofgem cap table, Ofgem cap explainer. Economy 7 cap explainer. Gas vs E7 vs peak elec heating costs, Best kettle!1 -
and on-going charges of 0.3% after a 1.8% contribution charge.
So after 6 years, your effective annual charge would be 0.6% , which is more than most people pay Vanguard( depending on the exact investment chosen)
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Thank you both for those valid points. Maybe in hindsight I hadn't thought it through.
She only has £6K in her Nest Pension and £8K in Vanguard. I have been trying for years to get her to save for her pension without success. Fortunately, I was able to help with a large house deposit, so I'm no longer beating myself up on her current pension situation.
I think my annual contribution will be about £3,600 (looking at £300 per month). She might receive a £100K inheritance in the next few years, so I'm hoping she will be able to include some additional pension contributions at that time. I am just trying to maximise on what she has available now.0 -
Hal17 said:She only has £6K in her Nest Pension and £8K in Vanguard.With a combined pot of £14k, you're looking at £42 a year at 0.3% in Nest or £48 a year at 0.15% in Vanguard.Hal17 said:I think my annual contribution will be about £3,600 (looking at £300 per month)..Or you can pay £0 in contribution fees and £48 a year to Vanguard.
N. Hampshire, he/him. Octopus Intelligent Go elec & Tracker gas / Shell (now TT) BB / Lebara mobi. Ripple Kirk Hill member.
2.72kWp PV facing SSW installed Jan 2012. 11 x 247w panels, 3.6kw inverter. 33MWh generated, long-term average 2.6 Os.Not exactly back from my break, but dipping in and out of the forum.Ofgem cap table, Ofgem cap explainer. Economy 7 cap explainer. Gas vs E7 vs peak elec heating costs, Best kettle!1 -
£48 per year on £14k is 0.34%. Add in 0.15% for Vanguard's platform fee. Add on their investment fee, say 0.24% for their target retirement date fund, and it comes to 0.73% per year so £102.20.Nest is 0.3% including platform AND investment, so £42 on £14k transferred.The contribution charge will not compound unlike a % fee as it's a one-off for each contribution.1
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engagedandopen said:£48 per year on £14k is 0.34%. Add in 0.15% for Vanguard's platform fee.
N. Hampshire, he/him. Octopus Intelligent Go elec & Tracker gas / Shell (now TT) BB / Lebara mobi. Ripple Kirk Hill member.
2.72kWp PV facing SSW installed Jan 2012. 11 x 247w panels, 3.6kw inverter. 33MWh generated, long-term average 2.6 Os.Not exactly back from my break, but dipping in and out of the forum.Ofgem cap table, Ofgem cap explainer. Economy 7 cap explainer. Gas vs E7 vs peak elec heating costs, Best kettle!3 -
QrizB said:engagedandopen said:£48 per year on £14k is 0.34%. Add in 0.15% for Vanguard's platform fee.0
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Hal17 said:QrizB said:engagedandopen said:£48 per year on £14k is 0.34%. Add in 0.15% for Vanguard's platform fee.1
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I am not familiar with the Nest set up in terms of available funds, there does not appear to be many choices.Its a very basic pension with an extremely poor fund selection.Very easy to justify better alternatives. That includes Vanguard platform as a better option.
So for me this would be easy to make contributions to the Nest pension. What I am not sure about is if Nest is a good option considering there are not any employers contributions?
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.1 -
dunstonh said:I am not familiar with the Nest set up in terms of available funds, there does not appear to be many choices.Its a very basic pension with an extremely poor fund selection.Very easy to justify better alternatives. That includes Vanguard platform as a better option.
So for me this would be easy to make contributions to the Nest pension. What I am not sure about is if Nest is a good option considering there are not any employers contributions?0
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