AVC recommendations

chases0102 · 10-06-2021 10:12pm #1

Hi all,

In the thick of researching and getting some different AVC products recommended from different brokers, a bit overwhelming.

Can anyone recommend a recent broker that they were happy with, regards service, charges, etc. Many thanks.

Happyhouse22 · 11-06-2021 9:29am

chases0102 wrote: »

Hi all,

In the thick of researching and getting some different AVC products recommended from different brokers, a bit overwhelming.

Can anyone recommend a recent broker that they were happy with, regards service, charges, etc. Many thanks.

I went with LaBrokers.

They offer a discount no advice service.
Access to Zurich funds
Annual charge of 1% with 100% allocation rate no other charges.

Happy so far, but it is a complete hands off service and all dealings are direct with Zurich.

Davy was another one I looked at , lower AMC but there is a charge for each transaction.but a good option if you just want to contribute once or twice a year into a diversified ETF (or similar)

chases0102 · 11-06-2021 9:36am

Happyhouse22 wrote: »

I went with LaBrokers.

They offer a discount no advice service.
Access to Zurich funds
Annual charge of 1% with 100% allocation rate no other charges.

Happy so far, but it is a complete hands off service and all dealings are direct with Zurich.

Davy was another one I looked at , lower AMC but there is a charge for each transaction.but a good option if you just want to contribute once or twice a year into a diversified ETF (or similar)

Many thanks for that advice, appreciated. Essentially I need to think about whether the service with advice is worth the extra money.

Treppen · 11-06-2021 10:53am

I'm going to be controversial here and say to have a look at Cornmarket !

Their consultation fee seemed saucy enough (around €550), but it can be deducted from your wages over the first year. I don't know what other consultations charged.

Just like LA Brokers they have 1% AMC (Annual Management Charge)

They will also do a non-consultation AVC which would be similar to LA Brokers. So you're going in blind but maybe it's just a matter of picking the risk level you want and sign on the line. If you have straightforward teaching service then it would be easier to calculate. Naturally enough they don't really advertise the non-consultation offer so you'll have to go looking.

In the end I went with Cornmarket with the consultation fee.
My circumstances were tricky calculating years of service, as my initial teaching experience with the department pay was all over the place (long and short term sub-work), but I'd kept payslips so they were able to go through them with me and give a better estimate. So I had a better idea of how much to contribute monthly. They talk very fast

You could contact the department and ask them but you'd be waiting for about 20 years for a reply.:pac:

https://www.cornmarket.ie/your-avc-scheme/
Click on the Fees and Charges section. Although it's probably the same whether you're TUI, ASTI or INTO

If you are depositing a lump sum it's a 4-5% charge.
Regular contributions are 0% contribution charge.

killbillvol2 · 11-06-2021 11:14am

People get hung up on the consultation fee. Given that the fund will run for 30+ years it's not much. Cornmarket also do regular reviews at no extra cost and basically hold your hand at retirement if that's what you want.

PSRA in Maynooth are also experienced in this field. Worth giving them a call.

Happyhouse22 · 11-06-2021 11:52am

I also don’t think cornmarket are the worst option- they have a bad reputation and probably justifiably so as I think in the past they had allocation rate below 100% meaning they took a percentage of every contribution you made. However their fees now look broadly similar to labrokers apart from that initial consultation fee.

I would just be wary of advice they give you, have heard stories of them always selling something extra - but from a strictly numbers point of view they don’t give a bad deal.

chases0102 · 11-06-2021 2:42pm

Thanks for the advice all. Yeah, it's funny, for the last couple of years, and throughout my bit of research into AVCs, there is a school of thought that Cornmarket were the lazy man's option, teachers just picking them as they didn't want any hassle. Of course the suggestion that they are more expensive than others.

But from above it sounds like they are essentially the same cost as other brokers?

Jerry Attrick · 11-06-2021 3:02pm

Happyhouse22 wrote: »

I don’t think cornmarket are the worst option- they have a bad reputation and probably justifiably so as I think in the past they had allocation rate below 100% meaning they took a percentage of every contribution you made. However their fees now look broadly similar to labrokers apart from that initial consultation fee.

I would just be wary of advice they give you, have heard stories of them always selling something extra - but from a strictly numbers point of view they don’t give a bad deal.

I can vouch for all of the above. They certainly seem to have cleaned up their act since Irish Life took them over.

But one thing that I'd add is that as they are 100% owned by Irish Life they may be tied agents, in which case they will only offer clients Irish Life products.

Happyhouse22 · 11-06-2021 3:29pm

Jerry Attrick wrote: »

I can vouch for all of the above. They certainly seem to have cleaned up their act since Irish Life took them over.

But one thing that I'd add is that as they are 100% owned by Irish Life they may be tied agents, in which case they will only offer clients Irish Life products.

This is a good point also, cor market only offer Irish life products, labrokers on offer Zurich products, worth researching to see if you are happy with the funds on offer before committing. Zurich have outperformed others in recent years but obviously no guarantee that will continue.

gaiscioch · 13-06-2021 1:15pm

Was with Cornmarket, but they just deal with Irish Life AVCs. Paid €150 to PSRA in Maynooth for independent advice/consultation. They said going with Irish life is like expecting an A in the LC from a C student and that Zurich are getting better returns. So, I’ve been with Zurich since.

Coincidentally, I have my mortgage protection with the discount broker in Wicklow mentioned above, LA Brokers. It worked out much cheaper. When I know more about AVCs I might go that “execution only” route but as mentioned those discount brokers give no advice or anything. For the moment I’ll stick with PSRA and that Zurich AVC. It’s a bit galling to have to give commissions to people for the duration of the AVC when I get nothing back from it. I had thought paying an upfront fee for independent advice would avoid that.

TheDriver · 13-06-2021 3:12pm

I'd find someone on staff who knows about pensions first so you can call out bull during a consultation. I've heard of lies being told.
The fees are important as it can add up to a lot. LAbrokers and the like are fantastic if you know what you want eg last minute AVCs whereby you don't want to waste money on being told what you already know.

Happyhouse22 · 13-06-2021 3:47pm

gaiscioch wrote: »

Was with Cornmarket, but they just deal with Irish Life AVCs. Paid €150 to PSRA in Maynooth for independent advice/consultation. They said going with Irish life is like expecting an A in the LC from a C student and that Zurich are getting better returns. So, I’ve been with Zurich since.
.

I think PRSA are tied agents with Zurich, and while they are correct that Zurich have vastly outperformed Irish life in the last 10-20 years there is no guarantee that will continue in the future.

Think it’s mad how hard it is to get real independent advice, reading international material on the topic, passive index investing is consistently recommended but that doesn’t really seem to be an option in Ireland. Instead we need to choose between expensive overpriced managed funds (even with a 1% AMC with Zurich or Irish life there are still hidden costs in there- as even the best of the funds consistently underperform the index they are tracking).

mike_cork · 14-06-2021 8:52am

Happyhouse22 wrote: »

I also don’t think cornmarket are the worst option- they have a bad reputation and probably justifiably so as I think in the past they had allocation rate below 100% meaning they took a percentage of every contribution you made. However their fees now look broadly similar to labrokers apart from that initial consultation fee.

I would just be wary of advice they give you, have heard stories of them always selling something extra - but from a strictly numbers point of view they don’t give a bad deal.

I signed up to an AVC with cornmarket a few months back. The rep I was dealing with was straight out about the companies previous bad reputation and even told me stuff to goggle if I wanted to check it out.......But he also told me the company has cleaned up, there are no hidden fees and their fee structure is now very competitive.
Having shopped around I found their fees to indeed be as good as I could I find.
This is the fee structure I was quoted by Cornmarket:
100% allocation
Set-up fee of 595-with tax relief it ends up as 357 spread over the first year
AMC-1% up to 40K,.75% up to 140K,.5% over 140K

Geuze · 14-06-2021 12:38pm

mike_cork wrote: »

there are no hidden fees and their fee structure is now very competitive.
Having shopped around I found their fees to indeed be as good as I could I find.
This is the fee structure I was quoted by Cornmarket:
100% allocation
Set-up fee of 595-with tax relief it ends up as 357 spread over the first year
AMC-1% up to 40K,.75% up to 140K,.5% over 140K

I have been the first person to criticise Cornmarket fees in the past, but to be fair, I also have noticed a change.

They now have various fee structures, including execution-only.

rainbowtrout · 14-06-2021 1:57pm

TheDriver wrote: »

I'd find someone on staff who knows about pensions first so you can call out bull during a consultation. I've heard of lies being told.
The fees are important as it can add up to a lot. LAbrokers and the like are fantastic if you know what you want eg last minute AVCs whereby you don't want to waste money on being told what you already know.

This by a million.

We had a rep in a few years back that gave a spiel to staff after school. I already have an AVC set up but I stayed for the entertainment.

Spiel started with rep outlining that the post 2013 pension would be worth less than pre 2013 due to career average earnings. That was fine. Then he started putting up figures on the powerpoint that showed a teacher retiring on 11k per year in a post 2013 scenario after full service. Cue a lot of distressed teachers.

I asked him to demonstrate where he was pulling the figure from cos I knew it was utter bull****. He said it was a complex formula and that a person's personal service and salary would have to be taken into account.

I said that isn't a problem as they should be able to show what salary and service was used to arrive at 11k. Then I pointed out that he was only showing the 'teacher' part of the pension and not the 'state' part of the pension which is now combined.

He actually came out and said that they couldn't include the state part of the pension because it wasn't guaranteed people would get it!!! When we are paying A rate PRSI yes we are entitled to a state pension. I wen through him for a shortcut.

Total mis-selling and fraudulent practice. I was disgusted.

chases0102 · 14-06-2021 11:37pm

Thanks for all these inputs folks.

Tempted to contact Cornmarket now. These brokers that I’ve contacted have me wary.

Would love to go execution only, but would be nervous over lack of advice, or indeed any input as to where the money goes.

Happyhouse22 · 15-06-2021 10:20am

chases0102 wrote: »

Thanks for all these inputs folks.

Tempted to contact Cornmarket now. These brokers that I’ve contacted have me wary.

Would love to go execution only, but would be nervous over lack of advice, or indeed any input as to where the money goes.

I think this is very reasonable, biggest drawback for me based on information in this thread would seem to be they only offer access to Irish Life funds.

Jerry Attrick · 15-06-2021 12:58pm

chases0102 wrote: »

Thanks for all these inputs folks.

Tempted to contact Cornmarket now. These brokers that I’ve contacted have me wary.

Would love to go execution only, but would be nervous over lack of advice, or indeed any input as to where the money goes.

You can decide where the money goes.

To do this, you look at the fund options and the risk levels and decide where you'd like to invest.

Here's the Cornmarket guide: https://www.cornmarket.ie/avc/investment-strategies/

And here's some AVC info from New Ireland (owned by BoI) for public service employees:

http://www.nuigalway.ie/pensions_investment/documents/nui_galway_avc_investment__options_member_guide__dsf_v1_04_09.pdf

Bit more: https://www.newireland.ie/pensions/pension-funds-performance/

And I'm sure Zurich have much the same info, but I'm too busy to look for it.

amacca · 25-01-2022 11:11pm

sorry to drag up an older thread, mods feel free to delete if too zombie!

Just wondered if anyone had compiled a complete list of what funds could be invested in across all of the avc providers in the irish market?

If you go execution only could you decide what fund you make your avc contributions to (ie: could you decide to put avc contributions into an sp500 index tracker etc) or are you limited to whats on offer through irish life, zurich etc?

Geuze · 25-01-2022 11:30pm

If you go with Zurich, you choose from a list of funds offered by Zurich.

Some may be in-house funds, managed by Zurich, others can be external funds.

Same goes for IL, some may be ILIM funds, but maybe also external.

Geuze · 25-01-2022 11:32pm

List of Zurich funds:

https://www.zurich.ie/funds/fund-products/

List of ILIM funds:

https://www.ilim.com/funds/

Geuze · 25-01-2022 11:34pm

Whether you pay full fees/commission, or use an execution-only broker, the range of funds are the same.

amacca · 26-01-2022 8:50pm

Thanks Geuze...appreciate that.

chases0102 · 26-01-2022 9:53pm

What is the added work for using an execution-only broker? As regards time, paperwork, etc.

Just to get a sense that if one was to cut out the middlemen, what would be entailed, and whether for someone with very limited knowledge of that area, would in fact be better off paying the fees to have it sorted for them.

Geuze · 26-01-2022 11:39pm

https://www.boards.ie/discussion/comment/118537627#Comment_118537627

Differences:

(1) no payroll deduction, so you provide IBAN for a DD - not much work there.

(2) no automatic tax relief at source - you post a cert to the Revenue, for them to increase your tax credits / SRCOP

(3) you must pick the funds yourself

gaiscioch · 27-01-2022 4:57pm

https://www.boards.ie/discussion/comment/118538089#Comment_118538089

It's not just discount brokers where you can't get the AVC payment deducted by the DoE in your salary. When I decided to leave the ASTI/Cornmarket/Irish Life AVC/PRSA scheme, I used a conventional broker - PSRA in Maynooth - and I couldn't get a payroll deduction either, unfortunately. It seems like the Department of Education only do that for people on the ASTI/Cornmarket scheme. I just pay a direct debit once a year and send the tax thing into revenue.

It would be very helpful to have the option of having it directly deducted.

I used LA Brokers in Greystones as my discount broker for Mortgage Protection and saved a good bit. Would there be much of a saving in using such a discount broker for an AVC? I could simply pick the same funds I'm currently in but just cut the middleman out, I assume? I'd like to have more control over it, without losing the tax benefits.

Geuze · 27-01-2022 9:02pm

https://www.cornmarket.ie/uploads/12748_Update_AVC_charge_statements_11-17_rebranded_TUI.pdf

Here are the fees on the TUI AVC scheme run by Cornmarket.

(1) Set-up fee = 525

(2) Regular charge on contributions = 2%

(3) AMC on funds = 1%

Using a discount brokers means the first two fees disappear, typically.

The discount broker is paid out of the 1% AMC.

Personally, I hate to see 2% of every euro I save being deducted before it even get put into shares/bonds, etc.

Geuze · 27-01-2022 9:04pm

The ASTI / INTO / nurses seem to have negotiated a better deal:

https://www.cornmarket.ie/your-avc-scheme/

(1) Set-up fee = 595

(2) Regular charge on contributions = 0%

(3) AMC on funds = 1%

gaiscioch · 10-02-2022 5:49pm

The fact mentioned above of the DoE refusing to deduct from salary AVCs other than Cornmarket means that my real nett income is being overstated by virtue of the AVC payment being excluded and this is having consequences. It wouldn't kill the DoE to facilitate this.

AVC recommendations

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