PAL Sipp & Brooks Macdonald Asset Management

jem16

Retired_I.F.A. wrote: »

You may think I'm nit picking here but Ed knows full well she is wrong and her only intent was to belittle IFA's as is her hobby.

If you look back at my posts you will see that I often get at Ed in her bias against IFAs.

However in this instance I have to say you are nit-picking

Using her whole quote she said;

IFAs are not regulated for giving advice on shares or investment trusts.So if you want to buy these you need to go to a stockbroker.

I think it was quite clear she meant giving advice on shares with the intention of buying them.

If you read a few more of Ed's posts you will actually find that it's a major admission getting her to say that IFAs are not authorised to recommend individual shares - see post 6 on the thread I linked to Dunstonh's post.

http://forums.moneysavingexpert.com/showthread.html?p=10717691#post10717691

Now there she does try to belittle IFAs.

dunstonh

IFAs can recommend packaged ITs and can set up SIPPs and other tax wrappers that allow investment into quoted stocks. However, unless the IFA has a stockbroker in house they will not recommend actual unpackaged ITs or shares.

We can of course comment on stocks and shares and if that particular "option" is suitable for the individual.

In this case, the IFA is recommending a discretionary fund manager to handle the investments. This is quite a good idea with large funds (£500k plus) if you want a wider range of investment options and management. 3% seems steep in this case unless the IFA is taking on the regulatory responsibility for setting up the SIPP (and I would still say its steep even if they are. A fixed fee would be cheaper).

bigbloke45

b2000, all personal pensions have the same tax breaks. As lots of people have already said, a SIPP is really for someone who wants to do it themselves and has some special knowledge, e.g. a particular property.

I think you are in danger of spending a lot more money (through charges) but being no better or even worse off at retirement by taking the SIPP option. I think Edinvestor has got the idea in her strapline "Trying to keep it simple"

Do you really want to pay extra layers of charges for a personal pension?

balooney2000

purch wrote: »

If you are not comfortable making the Investment decisions yourself, then using the full Fund choices of most good Personal Pensions could easily do just as good or even a better job for you.

Thanks for the guidance but can you expand upon full fund choices. Many Thanks.

balooney2000

Retired_I.F.A. wrote: »

The policy fee had me rolling around the floor with laughter:£300 + vat yr 1 £200 + vat each year thereafter. With the charges they are applying and the cautious view to investment the 50k is only going to go one way and it sure aint up.

Cheers for that. In another thread you comment that a trail fee of 1-2% pa is the norm nowadays so is your negativity simply aimed at the 3% set up fee ? Thanks.

dunstonh

balooney2000 wrote: »

Cheers for that. In another thread you comment that a trail fee of 1-2% pa is the norm nowadays so is your negativity simply aimed at the 3% set up fee ? Thanks.

Trail of 0.5% is the typical norm. However, that is taken out of the typical annual management charge of 1.5% and not instead of or in addition to.

The typical maximum is 3% plus 0.5% p.a. The typical average is 1.8% and 0.5% p.a for collectives. The larger your fund, the more you should expect to see the initial to drop.

The FSA is not at all happy at advisers taking more than 0.5% without them having some evidence and justification of the extra work they are doing to earn that charge. At the moment, some IFAs seem oblivious to that but the FSA have been warning about it for some time and the current FSA inspections seem to be focusing on excessive fees.

EdInvestor

balooney2000 wrote: »

The money is to be invested in a lower risk profile managed portfolio service fund of funds the detail of which is as follows.
Current Asset Allocation

Fund, P’cent, Sector

Invesco Perpetual High Income (inc) 7.0% UK
Jupiter Income 7.0% UK
Barcap - UK Acc Growth II 7.0% UK
Citigroup Autocall VI 5.0% Eu
Harewood Global Enhanced 6.0% Int
Barcap - S&P 500 125% 5.0% US
Standard Life Select 5.0% Property
New Star International Property 5.0% Property
Henderson Strategic Corporate Bond I 7.0% Int FI
Artemis Strategic Bond 8.0% UK FI
Fidelity Money Builder Income 6.0% UK FI
Absolute Return Trust 10.0% Hedge
ML Stepped Income & Growth 6.0% SR
Bar Cap Euro Ladder 6.0% SR

Cash 10.0% UK

One way you could start to get a grip is to look through the list of Standard Life funds available to you (in the link I posted earlier) and see which of the funds the IFA has chosen on his list are already on the SL list.

purch

I also thought that this only gave me a single option of purchasing an annuity whereas the SIPP gave me other options

Did your IFA tell you this, as part of his advice to move your PP to a SIPP ?

I benefit from the experience of those who are involved daily with the business of investment and am able to benefit from the tax benefits of a SIPP

You can benefit from the 'experience' by utilising the 240 odd Fund choices within the Standard Life PP......and a SIPP has no additional tax benefits over a PP

Bottom line is your IFA is going to arrange a SIPP where you invest in Funds no different to those currently available within your current PP, and charge you extra for it !!!!

dunstonh

Bottom line is your IFA is going to arrange a SIPP where you invest in Funds no different to those currently available within your current PP, and charge you extra for it !!!!

As I read this thread, the IFA is not making any fund recommendations. The investments are being handled by a discretionary fund manager. This would typically see the portfolio using shares, investment trusts and other direct investments which are only available on a SIPP and a couple of personal pensions.

EdInvestor

dunstonh wrote: »

This would typically see the portfolio using shares, investment trusts and other direct investments which are only available on a SIPP and a couple of personal pensions.

Looking at the list the only investments which wouldn't normally be found in a good PP like the SL one are the "Barcap" funds which I assume are ETFs. But it would probably be quite easy to replace these with conventional tracker funds which do the same thing.