Income drawdown vs annuity purchase at retirement

hoylakeq

Dear Ed,

Your thoughts regarding the withdrawal of max GAD are a little to simplistic I'm afraid.

In theory I can agree with part of what your saying but income tax, IHT, state of health, attitude to risk etc etc all need to be considered beforehand.

Q.

hoylakeq

Dear Whiteflag,

With regards to my charges, that's for discussion with clients only.

With regards to my findings, you should know that financial planning is subjective and there's no such thing as the perfect solution. If you accept that over the longer term the majority of managers fail to beat the market (as evidenced by numerous studies) then surely index performance in the lowest charged environment has to be a good starting point - at least for the equity element of a drawdown plan.

Q.

whiteflag_3

hoylakeq wrote: »

Dear Whiteflag,

With regards to my findings, you should know that financial planning is subjective and there's no such thing as the perfect solution. If you accept that over the longer term the majority of managers fail to beat the market (as evidenced by numerous studies) then surely index performance in the lowest charged environment has to be a good starting point - at least for the equity element of a drawdown plan.

Q.

Fair comment, however I think you need to be very careful coming on to this site stating your are an IFA and posting your name and then saying things
like

" This is best achieved via low cost SIPPs and ETF's ";)

hoylakeq

Whiteflag,

Fair point....I was only trying to be upfront and declare my position.

As mentioned, I dont normally post on MSE threads but sometimes the generic advice being thrown about needs answering, along with the belief that all advisers are incompetent idiots..........

Q.

dunstonh

As mentioned, I dont normally post on MSE threads but sometimes the generic advice being thrown about needs answering, along with the belief that all advisers are incompetent idiots..........

You have summed up MSE quite well there.

EdInvestor

hoylakeq wrote: »

......along with the belief that all advisers are incompetent idiots..........

People don't usually think advisors are incompetent idiots IMHO. Rather, they think they are more interested in lining their own pockets than those of their clients.

An advisor suggesting a low cost solution will thus tend to command attention.;)

whiteflag_3

EdInvestor wrote: »

People don't usually think advisors are incompetent idiots IMHO. Rather, they think they are more interested in lining their own pockets than those of their clients.

An advisor suggesting a low cost solution will thus tend to command attention.;)

in this case (like most) we have not been able to ascertain if it is actually "low cost"

hoylakeq

The reason I don't normally post on threads like this is the never ending 'reasoned arguments' between the posts.

However, take for example, Sippdeal / Sippcentre etc., for drawdown they charge £150pa plus £40 per quarter, plus VAT. So their charges are £356.50pa. Yes, you then have to pay for fund management but if you use trackers / etf this will come in at c.0.25%pa depending on who you use. Therefore, ignoring fees to advisers a fund of, say, £300,000, will be charged c.0.35%pa. That seems to be fairly low cost to me!

whiteflag_3

hoylakeq wrote: »

The reason I don't normally post on threads like this is the never ending 'reasoned arguments' between the posts.

However, take for example, Sippdeal / Sippcentre etc., for drawdown they charge £150pa plus £40 per quarter, plus VAT. So their charges are £356.50pa. Yes, you then have to pay for fund management but if you use trackers / etf this will come in at c.0.25%pa depending on who you use. Therefore, ignoring fees to advisers a fund of, say, £300,000, will be charged c.0.35%pa. That seems to be fairly low cost to me!

Yes very- but given that there are adviser fees on top, how can they be ignored?

hoylakeq

Whiteflag,

Because surely they should be the same regardless of the investment or the Sipp provider and are (to a degree) negotiable between client and adviser.

In my experience, and I'm sure yours is the same, clients want to know you are helping them with the right advice concerning the suitability of the product and the provider irrespective of your own fees.

As ever, no rights - plenty of wrongs, and many differing opinions!

Q.