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Pension advice.

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  • 14-02-2011 8:51pm
    #1
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭


    Hello folks.

    I am a bit green on this so take it easy on me.:)

    I have an Acorn life pension since 2007. My policy value is €6k at the moment. I pay €182.33 a month but this goes up every few months..:confused:

    It tells me that at 65 (now 32) I will have €309k @6% or €516k at 8%.

    Is this a good policy or is it a waste of time?. I appreciate your time and I will answer any questions you have.:)


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    #2
    Pablo Sanchez
    Closed Accounts Posts: 1,207 ✭✭✭Pablo Sanchez


    Your premium may be rising due to you taking up a indexation option, ie it will rise by 3/5% per year, or it may rise according to the consumer price index. You can pick a level of contribution you are comfortable with and stick with it if you choose, just let Acorn know in writing.

    Is it any good? Well as a pension is basically a long term savings plan, its only good if the underlying investment is performing, 6/8% is showing the estimated maturity value at 65 if the fund grows by 6/8% per year. This is for illustration purpose only and is certainly not guaranteed.

    What fund/s is it invested in?


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    #3
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    Arcorn life, hmmm. Well cant really anything too bad about them as their fund performance has been quite good, but on the other side of the coin I have a few clients that would say that the advice they got was very bad.

    From reading previous Acorn Life Threads their charges seems to be very high so if I were you I would look another pension provider. You can go excuetion only and pay 0% entry charge on each premium or Adviced based and pay between 2% and 5% premium entry charge. Excuetion only is for those who have an understanding of pensions though. (no doubt the usual culprits will be on posting their websites:rolleyes:)

    You must have opted for indexation, Acorn would put up the premium 5% every year where as most other providers would only put it up 3% a year, going up every few months dosen't sound right though???

    Funding for your pension is the second bigest investment you will make in your life apart from your home so you need to get it right. Continue funding for your pension, it is a good idea but keep reviewing it every year with your fin. advisor.


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    #4
    coylemj
    Registered Users Posts: 25,361 ✭✭✭✭coylemj


    Kennie1 wrote: »
    .... but keep reviewing it every year with your fin. advisor.

    Good advice but be aware that a financial adviser will get some kind of a kickback if you move your pension money and nothing if it stays put so there is an incentive for him to advise you to move. Sadly this happens far too often and people end up getting hammered by 'administrative' and 'setup' charges (= broker's commission) for the first few years when going to a new company which they were not made aware of when being advised to move.


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    #5
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    I will find out what option it is on and report back to ye. Cheers!


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    #6
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    coylemj wrote: »
    Good advice but be aware that a financial adviser will get some kind of a kickback if you move your pension money and nothing if it stays put so there is an incentive for him to advise you to move. Sadly this happens far too often and people end up getting hammered by 'administrative' and 'setup' charges (= broker's commission) for the first few years when going to a new company which they were not made aware of when being advised to move.
    I hear what your saying alright but the majority of pensions have drip feed commision any more so the charges are no longer taken up front (although from reading previous posts this is what Acorn does). If the op takes out a PRSA he will not be charged any up front charge apart from the usual 0 to 5% entry charge and AMC that every pension type has.

    Yes the advisor will get a commision for the transaction but this should not cost the OP any more than what he/she was already going to pay Acorn.


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    #7
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    Thanks folks. Funnily enough the Acorn rep rang me today!!!!!!!!!!!!!!. I am meeting him friday but he told me I could put my repayments up or down every month.

    I will post back on friday and let you know whats happening. Thanks for all the help and advice everyone..:)


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    #8
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    There is a couple of things that you need to ask him. Firstly how much you will have paid in over the life of the pension and secondly what is the "reduction in yeild" (If he says that he cant tell you he's bluffing you as it on the quotes system that they use). This should be no more than 1.3% if it is over this you are getting riped off in charges. RIY % is the effect of charges on your pension fund over the life of the pension. Based on your figures in your OP there seems to be a very high indexation factor of your premiums (maybe even 8%) as well so you need to ask what it is. The question is can you really afford this type of indexation every year. Good luck of friday!


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    #9
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    Thanks Kennie.;)


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    #10
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    Now folks!!!

    82% of my pension is on a managed growth fund and 18% is in a cautiously managed fund.

    My payments started at 150 per month and are now 182. I thought they increased more than that but it is only once a year.

    I have paid in €7,940 and it is currently worth €6,450. The reduction in yield is 1.1%.

    Cheers!!


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    #11
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    -Corkie- wrote: »
    Now folks!!!

    82% of my pension is on a managed growth fund and 18% is in a cautiously managed fund.

    My payments started at 150 per month and are now 182. I thought they increased more than that but it is only once a year.

    I have paid in €7,940 and it is currently worth €6,450. The reduction in yield is 1.1%.

    Cheers!!

    Anyone think this is good or bad or recommend a better provider..:)


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    #12
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    Are you an employee and do you have an active interest in pension investment? If you are an employee and dont have an active interest in pension investment I would consider a PRSA a better choice as you can pay this through payroll and your employer can contribute as well. Is the advisor worth his/her salt? Have they helped you with claiming tax releif and PRSI relief? Have they conducted investment risk stragity with you every year? As for a provider; that's purely objective as the provider is only as good as the advisor that is advising you! So the real question is can anyone recommend a good advisor...Sorry cant help you there as mods would only pull my post:p


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    #13
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    I am self employed. They give me a cert every year and my accountant uses that to claim it of my income tax. Why would the mods delete the post????


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    #14
    coylemj
    Registered Users Posts: 25,361 ✭✭✭✭coylemj


    -Corkie- wrote: »
    Why would the mods delete the post????

    They will pull a post which contains details of a service provider, you're supposed to recommend plumbers, dentists etc. by PM. Otherwise the place would be peppered with endorsements placed by the people themselves, something like the fake gushing reviews you see all over the place in Tripadvisor.


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    #15
    -Corkie-
    Closed Accounts Posts: 10,025 ✭✭✭✭-Corkie-


    coylemj wrote: »
    They will pull a post which contains details of a service provider, you're supposed to recommend plumbers, dentists etc. by PM. Otherwise the place would be peppered with endorsements placed by the people themselves, something like the fake gushing reviews you see all over the place in Tripadvisor.

    Oh right. Never knew that I was going to say my pension crowd but better not...:o


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    #16
    minder2009
    Registered Users Posts: 249 ✭✭minder2009


    Can anyone tell me , If I want to start a PRSA with 25 e per week that is 100 per month. What will I actually have to pay from my wages e.g. with the tax prsi relief available , what will I have to put in net to make 100 per month gross.Public servant - No employer contibution.Only starting it to avail of the prsi/tax relief.ThksDeclan


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    #17
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    €80 net per month will give a €100 gross per month contribution PRSI relief is not available from 2011 going forward as a result of the finance act 2011.


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    #18
    bailes
    Registered Users Posts: 52 ✭✭bailes


    I have paid in €7,940 and it is currently worth €6,450.

    This doesn't look great to me, you took out the pension in 2007, which along with 2008 wasn't a great year for pension funds as equity markets were in turmoil, if the investment strategy put in place from Day 1 was 82% Managed growth fund it would explain the negative return to date although last year should have given you some decent returns.

    You have to remember that it is a long term investment and i like the fact that Acorn is an Irish provider, but is there better out there? i would say yes.

    I am a Broker and not going to give my details but if I can help P.M me


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