Languishing pension funds - SJP Investment Acct option?
Discussion
Thinking of whacking some pension funds in a Trustee Investment Account but its a very new thing to me so seeking some well independent PH advice here!
IFA suggests if I had done this Last March I'd be £14k up by now (ex fees) on a middle 5 fig sum... Juicy!
I'm just seeing it longer term as loaded against any risk whatsoever for them with juicy lumps sums upfront - before they make me a penny!
These costs below are all based on the investment sum alone - they are NOT linked to a motivation to make a profit and then take a well deserved and fair slice of that:
[i]Initial costs 4.5% of amount invested.
Annual advice cost 0.5%
Product charge per investment 1.5%
Annual product management charge 1%
Early withdrawal charge 1% in first six years and if annually withdrawing more than 7.5% of fund value.
In addition to charges for the advice and the product, the costs of managing and maintaining the investments are also charged to the investment funds daily and are reflected in the prices of the investment funds. These costs include the fee paid to the fund manager and various other costs (such as audit fees, custody fees, VAT etc)
Then the rather un-reassuring: In the unlikely event that we are unable to meet our obligations to you, you may be entitled
to compensation under the The Financial Services Compensation Scheme. [/i]
I need to do something with some of this languishing pension fund but unsure this is the best choice - does anyone know any other options out there?
Cheers
IFA suggests if I had done this Last March I'd be £14k up by now (ex fees) on a middle 5 fig sum... Juicy!
I'm just seeing it longer term as loaded against any risk whatsoever for them with juicy lumps sums upfront - before they make me a penny!
These costs below are all based on the investment sum alone - they are NOT linked to a motivation to make a profit and then take a well deserved and fair slice of that:
[i]Initial costs 4.5% of amount invested.
Annual advice cost 0.5%
Product charge per investment 1.5%
Annual product management charge 1%
Early withdrawal charge 1% in first six years and if annually withdrawing more than 7.5% of fund value.
In addition to charges for the advice and the product, the costs of managing and maintaining the investments are also charged to the investment funds daily and are reflected in the prices of the investment funds. These costs include the fee paid to the fund manager and various other costs (such as audit fees, custody fees, VAT etc)
Then the rather un-reassuring: In the unlikely event that we are unable to meet our obligations to you, you may be entitled
to compensation under the The Financial Services Compensation Scheme. [/i]
I need to do something with some of this languishing pension fund but unsure this is the best choice - does anyone know any other options out there?
Cheers
Ken Figenus said:
[i]Initial costs 4.5% of amount invested.
Annual advice cost 0.5%
Product charge per investment 1.5%
Annual product management charge 1%
Early withdrawal charge 1% in first six years and if annually withdrawing more than 7.5% of fund value.
I use a local IFA to set up and manage my SIPP, who was known to me as they set up our firms stakeholder pension stuff. Annual advice cost 0.5%
Product charge per investment 1.5%
Annual product management charge 1%
Early withdrawal charge 1% in first six years and if annually withdrawing more than 7.5% of fund value.
I pay:
Initial costs 1.5% of amount invested.
Annual advice cost nil
Product charge per investment nil
Annual product management charge 0.75%
Early withdrawal charge nil.
I'm not changing because I like them and they seem to be doing a good job, but are these charges about the right level?
TwigtheWonderkid said:
I use a local IFA to set up and manage my SIPP, who was known to me as they set up our firms stakeholder pension stuff.
I pay:
Initial costs 1.5% of amount invested.
Annual advice cost nil
Product charge per investment nil
Annual product management charge 0.75%
Early withdrawal charge nil.
I'm not changing because I like them and they seem to be doing a good job, but are these charges about the right level?
It's impossible to say without knowing what overall return you are getting from your investments. What does the IFA do for 0.75% a year? Do you know what the overall charges are because you'll probably have platform & fund charges as well. only once you work out the actual annual performance will you know if the charges are right or not.I pay:
Initial costs 1.5% of amount invested.
Annual advice cost nil
Product charge per investment nil
Annual product management charge 0.75%
Early withdrawal charge nil.
I'm not changing because I like them and they seem to be doing a good job, but are these charges about the right level?
To the OP, there's a lot of hate for SJP on here, but I passed those numbers to my SJP advisor and asked him.
I suspect either you've been fed incorrect advice or you're being ripped off.
I'm not advocating you go with SJP, each to their own, but I would check the accuracy of the figures.
This is what he said:
There is no upfront charge or initial charge on the pension. Whatever is paid or transferred in is fully invested with nothing skimmed off the top (so no 4.5% initial charge).
The ongoing charge is dependent on the fund choice, but is around 1.5-1.6% per annum (note that this is the total charge which includes the advice/management/product charges).
There are early exit charges on the pensions for the first 6 years. After that there are none.
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
I suspect either you've been fed incorrect advice or you're being ripped off.
I'm not advocating you go with SJP, each to their own, but I would check the accuracy of the figures.
This is what he said:
There is no upfront charge or initial charge on the pension. Whatever is paid or transferred in is fully invested with nothing skimmed off the top (so no 4.5% initial charge).
The ongoing charge is dependent on the fund choice, but is around 1.5-1.6% per annum (note that this is the total charge which includes the advice/management/product charges).
There are early exit charges on the pensions for the first 6 years. After that there are none.
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
Mr Pointy said:
TwigtheWonderkid said:
I use a local IFA to set up and manage my SIPP, who was known to me as they set up our firms stakeholder pension stuff.
I pay:
Initial costs 1.5% of amount invested.
Annual advice cost nil
Product charge per investment nil
Annual product management charge 0.75%
Early withdrawal charge nil.
I'm not changing because I like them and they seem to be doing a good job, but are these charges about the right level?
It's impossible to say without knowing what overall return you are getting from your investments. What does the IFA do for 0.75% a year? Do you know what the overall charges are because you'll probably have platform & fund charges as well. only once you work out the actual annual performance will you know if the charges are right or not.I pay:
Initial costs 1.5% of amount invested.
Annual advice cost nil
Product charge per investment nil
Annual product management charge 0.75%
Early withdrawal charge nil.
I'm not changing because I like them and they seem to be doing a good job, but are these charges about the right level?
I'm in my first year, but they aim to achieve 4% after SIPP provider fees, as a minimum, which, give or take, would match what i will take out annually when I start to draw on it later this year.
sociopath said:
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
That is hilarious in being considered in any way generous.TwigtheWonderkid said:
I'm in my first year, but they aim to achieve 4% after SIPP provider fees, as a minimum, which, give or take, would match what i will take out annually when I start to draw on it later this year.
4% strikes me as a low target even if it is a minimum as the fund would be standing still & falling behind in real terms due to inflation. You might want to be closer to 6% to give yourself some inflation protection.JulianPH said:
Hi Ken
Give me a shout, those charges are just ridiculous.
I can go over all of your options with you (there are many).
Cheers
Thanks you all guys - suspicions confirmed Give me a shout, those charges are just ridiculous.
I can go over all of your options with you (there are many).
Cheers
Julian we had a chat once on a different matter but I need someone to kick my arse to follow through and DO something. I'm ready for it!
Thx
sociopath said:
To the OP, there's a lot of hate for SJP on here, but I passed those numbers to my SJP advisor and asked him.
I suspect either you've been fed incorrect advice or you're being ripped off.
I'm not advocating you go with SJP, each to their own, but I would check the accuracy of the figures.
This is what he said:
There is no upfront charge or initial charge on the pension. Whatever is paid or transferred in is fully invested with nothing skimmed off the top (so no 4.5% initial charge).
The ongoing charge is dependent on the fund choice, but is around 1.5-1.6% per annum (note that this is the total charge which includes the advice/management/product charges).
There are early exit charges on the pensions for the first 6 years. After that there are none.
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
Thanks for checking that out mate. I however wrote none of it - its a total cut and paste from their own doc. Re there is no upfront charge this is the actual para:I suspect either you've been fed incorrect advice or you're being ripped off.
I'm not advocating you go with SJP, each to their own, but I would check the accuracy of the figures.
This is what he said:
There is no upfront charge or initial charge on the pension. Whatever is paid or transferred in is fully invested with nothing skimmed off the top (so no 4.5% initial charge).
The ongoing charge is dependent on the fund choice, but is around 1.5-1.6% per annum (note that this is the total charge which includes the advice/management/product charges).
There are early exit charges on the pensions for the first 6 years. After that there are none.
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
If you decide to invest a lump sum with us, the cost of the
initial advice and our services will be 4.5% of the amount
you invest. For example, if you invest £100,000, the cost
will be £4,500. This cost covers all of our expenses incurred
in providing, checking and guaranteeing the suitability of
our advice. The remuneration of your Partner’s practice is
only one element of this cost, from which they meet their
own business expenses.
Cheers
Mr Pointy said:
TwigtheWonderkid said:
I'm in my first year, but they aim to achieve 4% after SIPP provider fees, as a minimum, which, give or take, would match what i will take out annually when I start to draw on it later this year.
4% strikes me as a low target even if it is a minimum as the fund would be standing still & falling behind in real terms due to inflation. You might want to be closer to 6% to give yourself some inflation protection.xeny said:
sociopath said:
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
That is hilarious in being considered in any way generous.None of my funds are under 6 years old so my withdrawal fees would be zero
Ken Figenus said:
sociopath said:
To the OP, there's a lot of hate for SJP on here, but I passed those numbers to my SJP advisor and asked him.
I suspect either you've been fed incorrect advice or you're being ripped off.
I'm not advocating you go with SJP, each to their own, but I would check the accuracy of the figures.
This is what he said:
There is no upfront charge or initial charge on the pension. Whatever is paid or transferred in is fully invested with nothing skimmed off the top (so no 4.5% initial charge).
The ongoing charge is dependent on the fund choice, but is around 1.5-1.6% per annum (note that this is the total charge which includes the advice/management/product charges).
There are early exit charges on the pensions for the first 6 years. After that there are none.
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
Thanks for checking that out mate. I however wrote none of it - its a total cut and paste from their own doc. Re there is no upfront charge this is the actual para:I suspect either you've been fed incorrect advice or you're being ripped off.
I'm not advocating you go with SJP, each to their own, but I would check the accuracy of the figures.
This is what he said:
There is no upfront charge or initial charge on the pension. Whatever is paid or transferred in is fully invested with nothing skimmed off the top (so no 4.5% initial charge).
The ongoing charge is dependent on the fund choice, but is around 1.5-1.6% per annum (note that this is the total charge which includes the advice/management/product charges).
There are early exit charges on the pensions for the first 6 years. After that there are none.
As an aside (not that it will ever be an issue for you), the 7.5% withdrawal allowance is cumulative. So let's say that you were 3 years into a surrender charge period, you could actually take 22.5% without paying a withdrawal charge.
If you decide to invest a lump sum with us, the cost of the
initial advice and our services will be 4.5% of the amount
you invest. For example, if you invest £100,000, the cost
will be £4,500. This cost covers all of our expenses incurred
in providing, checking and guaranteeing the suitability of
our advice. The remuneration of your Partner’s practice is
only one element of this cost, from which they meet their
own business expenses.
Cheers
Anyway, good luck with whatever you do.
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