Nest funds

olb81

My current work place pays into nest

I was wondering on people's view of their available funds.

Do they have any passive index global funds.

Many thanks

InvesterJones

They're quite cheap once the funds are in*, which is good, and I think they are semi-passive multi-asset global for the most part - you should be able to look up what the options are though it's a bit of a pain to see what the underlying investments are. I didn't hesitate to transfer out once I'd finished having payments going in, but they didn't offend me enough to bother with transfers before then.

*there's a high 1.8% fee on each contribution, but this is paid once only, thereafter it's just the AMC at 0.3% which is very reasonable for platform + fund fees. 

dunstonh

They recently changed them and there is limited data on the revised funds.  However, they are not great.  It's a simple scheme with middle-of-the-road options aimed at very small employers (who cannot afford to set up schemes with the big players).     You wouldn't pick them by choice if you were buying your own pension but there are worse options.

DE_612183

dunstonh said:

They recently changed them and there is limited data on the revised funds.  However, they are not great.  It's a simple scheme with middle-of-the-road options aimed at very small employers (who cannot afford to set up schemes with the big players).     You wouldn't pick them by choice if you were buying your own pension but there are worse options.

Hi, I've got a nest pension pot of about £100k - I'm no longer contributing and wasn't fussed on changing - especially as I'll retire soon and they don't charge for withdrawals.

Are there any other options I should consider?

InvesterJones

DE_612183 said:

dunstonh said:

They recently changed them and there is limited data on the revised funds.  However, they are not great.  It's a simple scheme with middle-of-the-road options aimed at very small employers (who cannot afford to set up schemes with the big players).     You wouldn't pick them by choice if you were buying your own pension but there are worse options.

Hi, I've got a nest pension pot of about £100k - I'm no longer contributing and wasn't fussed on changing - especially as I'll retire soon and they don't charge for withdrawals.

Are there any other options I should consider?

Plenty. Most platforms have a SIPP option, and if you're looking for a global passive index then that's easily available too. One example is fidelity - £90 annual fee cap for ETFs, and you can get an all country passive tracker ETF with low cost 0.12% (internal) fee such as ACWI. Plus there's a switching bonus cashback of £1000 if you transfer £100k

olb81

Thanks and a related question.
Is there any difference paying additional payments from the left or right side of my payslip?
On the left I inform the company and they do the payment before tax.
On the right I pay direct to nest and they claim tax relief and add the 20% to what I pay.
Are they the same?

InvesterJones

I'm guessing one is salary sacrifice, the other is direct payment and tax relief. They are not the same and they have different implications. There's a pensions board at MSE where you can get more help - but in short with salary sacrifice you are voluntarily reducing the amount the company pays you and in return they put more into your pensions - this mean they and you pay less national insurance (currently) as well as less income tax - but it also affects any salary-related considerations. In 2029 the benefits of salary sacrifice are due to reduce a bit so the tax advantage shrinks a bit.

Albermarle

I'm guessing one is salary sacrifice

From the way it is described it sounds more like a Net Pay scheme. Salary is not reduced, but pension contributions are taken out before tax. If this is the case then there is no difference in the end result.

OP - Can you confirm how your employer takes your contributions. Do they actually reduce your salary, but then make no further deductions for pension contributions. Or does your salary stay the same and you see an actual deduction on the left side of your payslip?

Albermarle

InvesterJones said:

DE_612183 said:

dunstonh said:

They recently changed them and there is limited data on the revised funds.  However, they are not great.  It's a simple scheme with middle-of-the-road options aimed at very small employers (who cannot afford to set up schemes with the big players).     You wouldn't pick them by choice if you were buying your own pension but there are worse options.

Hi, I've got a nest pension pot of about £100k - I'm no longer contributing and wasn't fussed on changing - especially as I'll retire soon and they don't charge for withdrawals.

Are there any other options I should consider?

Plenty. Most platforms have a SIPP option, and if you're looking for a global passive index then that's easily available too. One example is fidelity - £90 annual fee cap for ETFs, and you can get an all country passive tracker ETF with low cost 0.12% (internal) fee such as ACWI. Plus there's a switching bonus cashback of £1000 if you transfer £100k

Many investors prefer funds, especially low cost multi asset funds. In this case SIPP fees would be higher. In most cases above 0.3%.
£100K on Fidelity in say Vanguard Lifestrategy 60 would cost 0.57%.

Although a transfer cashback could help !

penners324

DE_612183 said:

dunstonh said:

They recently changed them and there is limited data on the revised funds.  However, they are not great.  It's a simple scheme with middle-of-the-road options aimed at very small employers (who cannot afford to set up schemes with the big players).     You wouldn't pick them by choice if you were buying your own pension but there are worse options.

Hi, I've got a nest pension pot of about £100k - I'm no longer contributing and wasn't fussed on changing - especially as I'll retire soon and they don't charge for withdrawals.

Are there any other options I should consider?

They dont allow you to take 25% tax free.

redpete

My NEST pension is a tiny proportion of the whole and from a very much part-time role. I wouldn't leave a significant amount in there due to:

• Very limited choice of funds and difficult to find details of what is in each fund.
• Clunky website. A challenge to do something simple like a timeline of contributions and when those contributions went into funds (and at what price). Also impossible to get today's unit value of the fund.

But then it's not aimed at someone like me who is interested in managing their own investments (possibly for the delusion of being in control).