Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie

How to find out what is the real investment/fees relation in pension funds

Options
  • 02-11-2011 2:35pm
    #1
    strandroad
    Closed Accounts Posts: 4,676 ✭✭✭


    I am trying to restart my PRSA and due to some factors I could go with either Zurich or Irish Life. Or something else but it would be a little more hassle. I wonder how to establish which one gives me better perspectives. I don't expect a high yield in a limited risk fund anyway but I know that the fees can eat into the pot a lot. How can I establish how much of each contribution will actually be invested? I can see that contribution fee, yearly fee plus pension tax are a lot already. I know these rates for IL and I need to find out about them for Zurich. Anything else they might charge for? Anything else I should take into account? Your help is much appreciated...


Comments

  • Options
    #2
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    A Standard PRSA's has only two charges, first one is contribution charge which is capped at a maximum of 5% and the second is annual management charge which is again capped at 1%. These charges can vary between provider and can be as little as 0% contribution and 0.65% AMC if you do not need any advice and understand how pension's work

    The two providers that you mentioned each have their own merrits with Zurich having the best managed fund returns and IL having the best index tracking error funds (based on past performance which is not a reliable guide to future performance) Tracking error is how much the fund returns differ from the actual returns of the index that the fund is tracking

    Who is your existing provider? I would ring them with your policy number and ask what are the charges listed above and then you can compare them against the other companies.


  • Options
    #3
    strandroad
    Closed Accounts Posts: 4,676 ✭✭✭strandroad


    Thanks Kennie, this is very useful. My previous employer had Zurich fund and my current one is IL hence the easiest option would be to renew with Zurich or switch to IL. IL fees are max of what you said then (5%+1%), I'll check what Zurich used to offer and what they have now. Thanks again.


  • Options
    #4
    Kennie1
    Registered Users Posts: 302 ✭✭Kennie1


    Just a little advice...You should ask your employer would they be willing to set set up a one member defined contribution pension for you instead of a PRSA.

    Your employer would be the trustee of this type of pension but the life company would fulfill the trustee's duties on their behalf (or else they would employ an independant trustee) The advantage of this type of arrangement is that you would not have to pay USC on your contributions.


  • Options
    #5
    strandroad
    Closed Accounts Posts: 4,676 ✭✭✭strandroad


    Unfortunately I don't think it's an option but thank you :)
    It turns out that Zurich offered me the same (5%+1%) so I could really flip a coin now!


Advertisement