Where are the cheapest long term investment funds

CPTM · 25-09-2022 07:23PM #1

Are long term investment funds setup by your bank a lot more expensive than getting it organised by some independent company? Basically we're looking to set up an investment fund, putting in around 500 per month for about 20 years and we haven't a clue where to start. Our bank has a person who can help, but I know from experience that banks are a lot more expensive when it comes to life insurance or mortgage protection, and I'm wondering is it the same when it comes to setting up funds. Can I just go to Irish Life or Zurich directly? Are they all basically the same cost?

26-09-2022 08:04AM

You can buy a product that suits those criteria on an execution only basis with the following pricing structure:

100% Allocation, 1% AMC on circa 35 funds, No Entry/Exit Charges, Online access to your account, No additional broker fee.

If you need advice the charges will be higher but the above will help you with your research.

Henry Ford III · 26-09-2022 08:34AM

Get independent advice. Bank advisors are not independent.

p.s. There's a lot more to chosing the best savings plan than a race to the bottom charges wise.

Gussie Scrotch · 26-09-2022 08:37AM

I agree that you should get independent advice.

However, FWIW, I have found Vanguard to be good over a long period of time.

CPTM · 26-09-2022 06:39PM

https://www.boards.ie/discussion/comment/119665355#Comment_119665355

Do you know whether independent advisors are affiliated to one fund over another?

The J Stands for Jay · 26-09-2022 10:14PM

https://www.boards.ie/discussion/comment/119665359#Comment_119665359

Where have you accessed vanguard?

Henry Ford III · 27-09-2022 09:22AM

https://www.boards.ie/discussion/comment/119667999#Comment_119667999

They are obliged to tell you if they are. Pay particular attention to their "Terms of Business" document.

Jim2007 · 27-09-2022 10:12AM

There once was a reasonable piece of advice that got turned on it’s head and spawned an entire industry…..

The original idea was that you should not pay more in fees than the cost of an ETF for poor performance not that you should actually go and pay for poor performance. It should be your benchmark mark in determining what is worth paying for! Some how this morphed into let’s pay for the worst performing funds available in the retail market.

The consensus return of equities is somewhere around 5-6% over the long haul and give the current cost of ETFs you should expect to pay around 0.5-0.9% for it. If you compare that to a fund manager with a twenty year track record of delivering an annualized return of 16% at a fee of 2%, is it worth paying for? Probably yes, there is a lot of padding in there to cover mistakes over the long haul.

Buying ETFs on cost basis along is not to be recommended. Apart from all the usually portfolio management issues, there is the question of how the fund is constructed. The number of shares available is finite, while the demand for funds is not, managers can’t just buy the market. The difference is made up for by the use of leverage and synthetics and while this seems to work most of the time, it may come unstuck if there is a market squeeze.

Buying low cost ETFs may not be the low risk cheap option some people think, so get independent advice.

Gussie Scrotch · 28-09-2022 09:08AM

https://www.boards.ie/discussion/comment/119668854#Comment_119668854

Through my Financial advisor back in 1985.

Where are the cheapest long term investment funds

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