IFA charges?

[Grandfondo]

Now that commission charges have been abolished what is the going rate for SIPP management?
ie- annual fund management,monthly contributions and fund realigning?

[NatAsp]

Although "Commission" has been replaced by "Adviser Charging", there is very little difference in the way that most IFAs will charge.

0.5% to 1% pa - that's assuming you require a regular portfolio rebalancing and review service

[Grandfondo]

NatAsp said:

Although "Commission" has been replaced by "Adviser Charging", there is very little difference in the way that most IFAs will charge.

0.5% to 1% pa - that's assuming you require a regular portfolio rebalancing and review service

What about money on the way in? And is rebalancing on top of the 0.5/1% annual charge?

[pacoryan]

The fund management will be additional to the adviser charge. Ball park for adviser is right and would (in my practice) include rebalancing and an annual review subject to a minimum level of income/fund size.

Fund Management can be anywhere from next to nothing to over 1%, platform or provider 0.3-0.5%. Discretionary portfolios on a platform type SIPP with an adviser charge should be under 2% all in.

Additional regular contributions do not attract an additional charge, and are usually set at the annual review. Ad hoc large (single) contributions might if a full review is required. Again, this is at my practice, others will charge up to 3% on each regular contribution.

[NatAsp]

Grandfondo said:

What about money on the way in? And is rebalancing on top of the 0.5/1% annual charge?

I echo the above, most won't levy initial charges on regular contributions and rebalancing should be included within the on-going adviser charge or 0.5 - 1 pa.

The fund charges will vary depending upon the risk profile of your portfolio and whether or not the adviser employs a passive (index tracking funds - cheap) or an active (actively managed funds) investment strategy.

[Grandfondo]

NatAsp said:

I echo the above, most won't levy initial charges on regular contributions and rebalancing should be included within the on-going adviser charge or 0.5 - 1 pa.

The fund charges will vary depending upon the risk profile of your portfolio and whether or not the adviser employs a passive (index tracking funds - cheap) or an active (actively managed funds) investment strategy.

It Looks to me that he wants to charge 4% on the way in and 1% annual and a rebalancing charge!
I may be doing him an injustice so will talk to him tomorrow.

[NatAsp]

Grandfondo said:

It Looks to me that he wants to charge 4% on the way in and 1% annual and a rebalancing charge!
I may be doing him an injustice so will talk to him tomorrow.

1% annual charge is, high, although not unacceptable. If you have a small pot (relatively speaking) of less than, say, 50k then 1% is reasonable. If you have over 100k then it may be worth negotiating.

4% per regular contribution is too much, in my opinion.