# Pension - buy out bond enquiry.



## jxwell (22 Jan 2014)

have 100k from previous pension scheme and am looking at a bond. One option I have explored is Horizon plan options buy out bond E with AVIVA and strategic multi asset fund.  100% Allocation with no initial commision and an annual fund charge of 0.90%. Is this good value as regards charges ? or what other bonds companies should I consider ? just trying to get a sense of charges generally.Thanks for any input (note 20+ years to retirement)


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## GSheehy (28 Jan 2014)

jxwell said:


> Is this good value as regards charges ? or what *other bonds companies * should I consider ?



I doubt that you will be able to buy the product cheaper from the company *direct* that you could through a discount broker.


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## fayf (28 Jan 2014)

It doesen't sound too bad, but I would continue to shop around. 
Staying with the policy for 5 years will mean fees of around 5,000 Euro to a broker/supplier, so it's worth a little bit of extra research.

No Initial commission(or transfer fee), appears to be fairly standard. Watch the early exit penalties (typically, exiting the plan in less than 5 years)which is mainly relevant if you plan on drawing, within the next 5 years. 

Some of the Buy Out Bond quotes I have received are applicable to fund values of over 100k, so the fund value can make a difference, but take a detailed look around.

It's not all about the annual charges either. Have a look at the fund choices offered. The charges are less relevant, if the fund you select is an underperformer. Getting professional advice can cost, but can be well worth it, unless you are very well informed and know exactly what you are doing


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## Steven Barrett (29 Jan 2014)

jxwell said:


> have 100k from previous pension scheme and am looking at a bond. One option I have explored is Horizon plan options buy out bond E with AVIVA and strategic multi asset fund.  100% Allocation with no initial commision and an annual fund charge of 0.90%. Is this good value as regards charges ? or what other bonds companies should I consider ? just trying to get a sense of charges generally.Thanks for any input (note 20+ years to retirement)



With €100k, you could go for Zurich Life's reduced management charge contact where you can get a management charge of 0.4%. Cheap as chips for a pension contract. 


Steven
www.bluewaterfp.ie


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## meagain (28 Mar 2014)

Steven
How does one go about obtaining one of these reduced management charge contracts with Zurich and is it only Zurich life offers this?
I have a old prsa avc (circa 6 years old)from a previous employment with a previous employer with Zurich which I was thinking of switching to standard life as I think standard life has more fund options but as an alternative could I request Zurich life to commence a new reduced management fee policy instead?


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## Steven Barrett (31 Mar 2014)

Hi Meagain

Other providers do have reduced management fee structures. The problem with PRSA's though is the charging structure is laid out in legislation. If a life company wants to change their charging structure, they have to apply to The Pensions Board and add a new PRSA contract to their offering and pay fees accordingly. It is not very profitable. That is why Standard Life for instance only have one PRSA (they did get rid of Personal pensions originally, then when PRSA's didn't take off, got rid of them altogether). 

There may be ways around it.

Steven
www.bluewaterfp.ie


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## meagain (31 Mar 2014)

Thanks Steven

Not clear how one goes about obtaining a reduced management charge contract?


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## Steven Barrett (1 Apr 2014)

I don't think you can for PRSA's. It would have to be looked into whether you can transfer those benefits into another pension vehicle that can avail of them. 


Steven
www.bluewaterfp.ie


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