Anyone used PensionBee?

[cbehagg242]

Hi all,
After some advice on pensions as my ltd company is approaching the end of year 2 so would like to make an employer contribution into a personal pension as I really disliked seeing a large chunk of money go out in CT last year. I'm also 26 so feel I can go into quite an aggressive/risky plan as I won't be able to access it until I'm probably 70 the way the retirement age keeps rising.

Has anyone used PensionBee? Seem well reviewed on TrustPilot and operate the same way as Nutmeg via risk based profiling. (Nutmeg also offer pensions but since I signed up to a S&S ISA with them last month I am down -£53, I know from my limited investment knowledge it's best not to judge a 10year ISA on the first month but something makes me wary of pushing a large pension amount their way as well).

Their plans are in the screenshot below. Not sure what one to choose tbh, fees range from 0.5 - 0.7% left to right. Any ideas?


I don't know enough about investing to go the SIPP route so looking at a managed fund hence the PensionBee, Nutmeg offerings seem like a good solution.

Any advice appreciated.

Thanks,
Craig

[JulianPH]

PensionBee is only two years old and whilst they are using industry giants for your investments the fact sheets from these managers (State Street and Black Rock) are hazy when it comes to the PensionBee quoted fees.

There could be absolutely nothing wrong with the offering(s) but for some reason I am a bit sceptical. For example they state you pay nothing other than the 0.5%/0.6%/0.7% annual management fees but;

A) Don't state the OCF (Ongoing Charges Figure) figure (the full costs)
B) Have reference elsewhere on their site to a £100 initial charge (for investments of less than £5,000)
C) Don't mention the State Street fund has a 0.15% Subscription (initial) fee and a 0.8% Redemption (exit) fee

Equally the company (as per its last accounts - albeit just over a year ago) had a profit/loss account figure of -£318,179 (and this included £522,766 of cash at bank and in hand).

So whilst it looks good on their site, I just feel uncomfortable after 10 minutes of due diligence.

Of course, I might be wrong and it could be a great business - you are also fully covered by the Financial Services Compensation Scheme so technically can't actually lose money if you use them anyway.

[cbehagg242]

JulianPH said:

PensionBee is only two years old and whilst they are using industry giants for your investments the fact sheets from these managers (State Street and Black Rock) are hazy when it comes to the PensionBee quoted fees.

There could be absolutely nothing wrong with the offering(s) but for some reason I am a bit sceptical. For example they state you pay nothing other than the 0.5%/0.6%/0.7% annual management fees but;

A) Don't state the OCF (Ongoing Charges Figure) figure (the full costs)
B) Have reference elsewhere on their site to a £100 initial charge (for investments of less than £5,000)
C) Don't mention the State Street fund has a 0.15% Subscription (initial) fee and a 0.8% Redemption (exit) fee

Equally the company (as per its last accounts - albeit just over a year ago) had a profit/loss account figure of -£318,179 (and this included £522,766 of cash at bank and in hand).

So whilst it looks good on their site, I just feel uncomfortable after 10 minutes of due diligence.

Of course, I might be wrong and it could be a great business - you are also fully covered by the Financial Services Compensation Scheme so technically can't actually lose money if you use them anyway.

Many thanks for that Julian, appreciate you taking the time to have a look over. Based on your reply, would you recommend any other personal plan providers which would best suit my current situation or even have some advice about what to look out for when choosing a plan provider? Would the Nutmeg offering be any better/safer?

On a side note I asked on their live chat about point C you made and this was their response:

You asked "I see on the tracker plan that the fee is 0.5%. On the fact sheet there is a initial fee of 0.15% and a 0.08% redemption fee. Are these included in the 0.5% total annual fee?"

In answer to your question, the two figures you've asked about are the difference between the buy and sell prices of the units inside the plan. State Street, Money manager, aims to match units bought and units sold, but where they cannot they need to pay a transaction fee in order to make the investment.
---

To be honest I'm not sure what that means and whether its an additional fee that I pick up or not.

Thanks,
Craig

[JulianPH]

cbehagg242 said:

Many thanks for that Julian, appreciate you taking the time to have a look over. Based on your reply, would you recommend any other personal plan providers which would best suit my current situation or even have some advice about what to look out for when choosing a plan provider? Would the Nutmeg offering be any better/safer?

On a side note I asked on their live chat about point C you made and this was their response:

You asked "I see on the tracker plan that the fee is 0.5%. On the fact sheet there is a initial fee of 0.15% and a 0.08% redemption fee. Are these included in the 0.5% total annual fee?"

In answer to your question, the two figures you've asked about are the difference between the buy and sell prices of the units inside the plan. State Street, Money manager, aims to match units bought and units sold, but where they cannot they need to pay a transaction fee in order to make the investment.
---

To be honest I'm not sure what that means and whether its an additional fee that I pick up or not.

Thanks,
Craig

Hi Craig

No problem!

They are obfuscating with that answer. It is what it is - and there really is no problem with it as it is common practice with many pension funds - but their answer to you shows straight away that they are being misleading on their website (and therefore could be being misleading with other factors).

I personally don't like Nutmeg and find it too gimmicky without real substance. Others may disagree with me.

I would have a good look at Parmenion if I were you. Same price point as PensionBee but a well established player with several billion of assets under management and a 'does what it says on the tin' approach. They are also owned by Aberdeen - who are now merging with Standard Life to create an absolute giant - so financially very strong.

Cheers

Julian

[JulianPH]

Hi again Craig

I have just read the above back and realised I didn't actually answer your question either!

Those fees are not included in the 0.5% annual charge - they are in addition.

That their website explicitly state all you will pay is 0.5% a year and their answer didn't actually tell you these fees (however small) are on top of this 0.5% I would not use them.

With Parmenion they tell you exactly what the fees are and don't try to hide anything.

I have no connection to Parmenion other than I knew the founder and CEO in a professional capacity. He sadly passed away last year so now I have no connection to them, I just know they are good at what they do.

Cheers

Julian

[cbehagg242]

JulianPH said:

Hi Craig

No problem!

They are obfuscating with that answer. It is what it is - and there really is no problem with it as it is common practice with many pension funds - but their answer to you shows straight away that they are being misleading on their website (and therefore could be being misleading with other factors).

I personally don't like Nutmeg and find it too gimmicky without real substance. Others may disagree with me.

I would have a good look at Parmenion if I were you. Same price point as PensionBee but a well established player with several billion of assets under management and a 'does what it says on the tin' approach. They are also owned by Aberdeen - who are now merging with Standard Life to create an absolute giant - so financially very strong.

Cheers

Julian

Thanks Julian

Will certainly look into Parmenion, if they offer a managed portfolio like Nutmeg/PensionBee then that seems to meet my requirements.

Agree with what you say about PensionBee, makes you think what else they could be misleading about.

Cheers,
Craig

[mikeiow]

We live in a fast changing world of FinTech (financial technology) products coming out all the time. I have a Monzo card which is fabulous for low-cost foreign payments and cash out abroad....but already they are planning a full current account to replace it!

I doubt we will know how well the likes of Nutmeg and PensionBee can pan out for people for a few years: some may do well, some will get acquired and continue to do well, some will fold and get messier than Equitable Life (search for "equitable life pension scandal" for more on that one!).
& some will simply fail to do as well as established players like FriendsLife (where the bulk of mine is).

This is not desperately helpful, but my gut instinct now would be to look at the more established players (you are dealing with a very long term product)....
....& also look at other ways to share a balanced investment: if I was 26 with some lump cash to hand, & bearing in mind I am NOT a landlord or financial advisor, I would also consider some property investment of some sort: as Mark Twain once wisely wrote: “Buy land — they’re not making any more!”.
Eggs and baskets are the main thing for investments, especially long term ones.

Good luck!

[elliot_holder]

Just my 2 cents from recent personal experience.

I've used PensionBee to consolidate a number of pensions from previous employers.
For this they've been incredibly helpful and its where (for me) the proposition works really well.

I've worked for a number of different employers and had small pensions with different providers all over the place, for most I have little to no paperwork or information other than who the provider is.

PensionBee managed to track all these pensions down, in most cases with little to no information or effort from me and had them transferred within a matter of weeks, all managed by a single person who'd e-mail me directly if there were any queries.

It was a very good experience and completely effortless.

Given some time I may consider moving the now consolidated pensions out of PensionBee, but for the moment I'm very pleased.

Yes, they are small and a start-up but the benefit of this is that you get a very personal service.

[cbehagg242]

elliot_holder said:

Just my 2 cents from recent personal experience.

I've used PensionBee to consolidate a number of pensions from previous employers.
For this they've been incredibly helpful and its where (for me) the proposition works really well.

I've worked for a number of different employers and had small pensions with different providers all over the place, for most I have little to no paperwork or information other than who the provider is.

PensionBee managed to track all these pensions down, in most cases with little to no information or effort from me and had them transferred within a matter of weeks, all managed by a single person who'd e-mail me directly if there were any queries.

It was a very good experience and completely effortless.

Given some time I may consider moving the now consolidated pensions out of PensionBee, but for the moment I'm very pleased.

Yes, they are small and a start-up but the benefit of this is that you get a very personal service.

Thanks Elliot. What kind of returns have you seen now that the pensions have been consolidated?

I wonder if there is anything to stop someone like yourself using PensionBee to consolidate previous pensions together then just buggering off with the new all-in-one pot and investing with a more established provider?

[elliot_holder]

cbehagg242 said:

Thanks Elliot. What kind of returns have you seen now that the pensions have been consolidated?

I wonder if there is anything to stop someone like yourself using PensionBee to consolidate previous pensions together then just buggering off with the new all-in-one pot and investing with a more established provider?

TBH, doesn't seem to be anything to stop anyone doing that.

Unfortunately its too early to make any judgement on the returns, its only been a few weeks.

I'm going to keep my consolidated pensions there in the short-term and will see how the returns stack up. In the meantime I'm very happy as I avoided a load of paperwork and time on the phone with various pension providers.