Need a reliable IFA (for sourcing an annuity only)

TheGreenFrog

dunroving said:

TheGreenFrog said:

In my experience the ease of finding an IFA willing to act on a transactional basis for an annuity is linked to the amount involved, because the amount of work involved is not that different whether you are looking to buy an annuity with £50k or £500k.   

Is that because their fee will be higher for a higher amount?

Sorry - was in the middle of clarifying my (now amended) post.  For the IFAs I contacted they did charge a % - but there must be a minimum fee they would want for the work involved.  Let's say it was £2,000 - some might not want to quote that for a £40k annuity sum.

incus432

DRS1 said:

There was a thread on here earlier this year I think asking much the same question.  The OP on that thread ended up using Retirement Line who are not an IFA but an annuity broker.  The IFAs all wanted to do more than just buy an annuity whereas the annuity brokers stick to that one thing.  But they are not cheap and if you can find an IFA who will do it you will probably get a better deal that way. There are other such brokers around (including LV= I think.  Anyway a google search for pension annuity will probably throw up a decent list) or you could look at Hargreaves Lansdown.

I will see if I can find the thread in case there are any useful suggestions in there or you can ask that OP if he ever found an IFA who could do the job.

That thread was me I think! Yes retirement line were good. Too late I found a willing IFA who would do it for lower commission but the difference wasn't huge (1000 v 1500 I think)  The unbiased and other lists were useless - all expensive wealth managers. The IFA was local so do local searches, but be prepared for lots of no replies 

FIREDreamer

I bought an annuity using Hargreaves Lansdown. I was happy with the income i secured. They were paid 0.8% of the purchase money by the annuity provider.

incus432

DRS1 said:

Well I could not find the thread but the OP may have been @incus432 judging by this post

Anuities Research — MoneySavingExpert Forum

Yes it was.  The IFA who was willing (but I did not use as he had been on holiday and replied too late) is based in Stockport. Can send details if asked. He sent quotes promptly but as didn't buy from him I can't really comment further. 

TheGreenFrog

FIREDreamer said:

I bought an annuity using Hargreaves Lansdown. I was happy with the income i secured. They were paid 0.8% of the purchase money by the annuity provider.

HL are indeed competitive for annuities.  I have found though that their commission is not strictly % based, or rather if it is then the percentage is higher for smaller sums than larger.  But what counts is the income after commission, not the commission.

dunstonh

TheGreenFrog said:

dunroving said:

TheGreenFrog said:

In my experience the ease of finding an IFA willing to act on a transactional basis for an annuity is linked to the amount involved, because the amount of work involved is not that different whether you are looking to buy an annuity with £50k or £500k.   

Is that because their fee will be higher for a higher amount?

Sorry - was in the middle of clarifying my (now amended) post.  For the IFAs I contacted they did charge a % - but there must be a minimum fee they would want for the work involved.  Let's say it was £2,000 - some might not want to quote that for a £40k annuity sum.

Most firms will operate a minimum fee.

If the annuity purchase price is £40k  (i.e. after tax-free cash taken), then you are probably better off on a commission basis via a non-advised distribution service.   IFAs get better with larger fund values, where fee tapering or caps result in a fee that is lower than the commission method.

HL are indeed competitive for annuities.  I have found though that their commission is not strictly % based, or rather if it is then the percentage is higher for smaller sums than larger.  But what counts is the income after commission, not the commission.

That is important to note as a number of years ago, a client used HL for pricing and got me to quote as well  and HL's commission was lower than our fee but the annuity rate I obtained was higher and resulted in a greater monetary amount.   I put that largely down to the medical questionnaire completion as I repeatedly went back to get missing and further medical details.   Non-advised services will usually take what they are given and not go back to probe for more detailed information.  

RogerPensionGuy

I looked at getting an annuity early 2024 via IFAs. 

I got a nice service, but still haven't picked one or use any SIPP funds yet. 

If I remember correctly, I was surprised on how little or no difference to me the gross payment would be on 100K, 200K, 300K or 400K, all exact same policies in essence. 

I had just assumed getting one annuity for 400K would get me better value than getting 4 X 100K policies, 4 times the paperwork.

The IFAs agreed with my views and said they would reduce their fees on the bigger figure annuities to get me more value, but not much extra value in my opinion. 

My pick up was maybe do a few different annuities with various inflationary choices or maybe do a fixed term say 15 years(the do years)

Now my SIPP has dropped about 17/18% in the last 3 months makes looking at annuities now a bit horrible in my little head, it's 100% equities and is very USA/Tech heavyweight, most friends SIPPs have mosty dropped between 6 to 12%

I'll keep my SIPP and possibly annuities on monitor. 

dunroving

dunstonh said:

TheGreenFrog said:

dunroving said:

TheGreenFrog said:

In my experience the ease of finding an IFA willing to act on a transactional basis for an annuity is linked to the amount involved, because the amount of work involved is not that different whether you are looking to buy an annuity with £50k or £500k.   

Is that because their fee will be higher for a higher amount?

Sorry - was in the middle of clarifying my (now amended) post.  For the IFAs I contacted they did charge a % - but there must be a minimum fee they would want for the work involved.  Let's say it was £2,000 - some might not want to quote that for a £40k annuity sum.

Most firms will operate a minimum fee.

If the annuity purchase price is £40k  (i.e. after tax-free cash taken), then you are probably better off on a commission basis via a non-advised distribution service.   IFAs get better with larger fund values, where fee tapering or caps result in a fee that is lower than the commission method.

HL are indeed competitive for annuities.  I have found though that their commission is not strictly % based, or rather if it is then the percentage is higher for smaller sums than larger.  But what counts is the income after commission, not the commission.

That is important to note as a number of years ago, a client used HL for pricing and got me to quote as well  and HL's commission was lower than our fee but the annuity rate I obtained was higher and resulted in a greater monetary amount.   I put that largely down to the medical questionnaire completion as I repeatedly went back to get missing and further medical details.   Non-advised services will usually take what they are given and not go back to probe for more detailed information.  

With regard to my OP, the amount is over £100k (and is a fair bit lower than it was before the Trump Slump). That, and the fact an IFA is more likely to take an interest in my specific case, makes me lean even more towards an IFA than a non-advised commission service. Though I'm swithering now about waiting a year or three for the slump to correct itself. I need to look into how market turmoil affects annuity values... My original plan was to look into this last summer; I'm now getting payback for my procrastination.

JulieK_2

incus432 said:

DRS1 said:

Well I could not find the thread but the OP may have been @incus432 judging by this post

Anuities Research — MoneySavingExpert Forum

Yes it was.  The IFA who was willing (but I did not use as he had been on holiday and replied too late) is based in Stockport. Can send details if asked. He sent quotes promptly but as didn't buy from him I can't really comment further. 

@incus432 I am looking for exactly this service and live in Stockport so wondered if you could give me the details of the IFA who was willing to just source and set up an annuity please? An IFA local to me would be great! Also was the £1000 a flat fee or what it worked out at as a percentage of your fund? 

Everywhere I have looked seems to say 1-3% of fund and the lower the fund the higher the % fee. My fund is just over £100k so would probably incur the higher fee am guessing. 

Like others have said searching on Unbiased or Vouched for comes up with people who seem to want to manage portfolios etc which is not what I want. I just want to buy a simple single life level annuity at the best rate possible now with a view to stopping work at the end of the tax year 2026. Should have done this earlier this year before the rates dropped! I know I will be paying tax on it until I stop working but better that than waiting a few more months and the rates dropping further or my fund dropping - or both(!) and then having to take what I can get at the time or not being able to stop working! 

Thanks if you are able to provide this info

dunstonh

Everywhere I have looked seems to say 1-3% of fund and the lower the fund the higher the % fee. My fund is just over £100k so would probably incur the higher fee am guessing. 

Probably in the ballpark of £1500-£2000.

Like others have said searching on Unbiased or Vouched for comes up with people who seem to want to manage portfolios etc which is not what I want.

If you use unbiased for advisers near you but untick the box at the bottom, then all your local IFAs should appear.  Unbiased doesn't show them as default.  You have to untick it for them to appear.

 Should have done this earlier this year before the rates dropped!

They are still higher now than they were earlier in the year.