# Is this a good deal



## WillGilbert (16 Dec 2006)

I am a proprietry director and have not been contributing much to a pension scheme fro last 10 years. There is an amount of money built up in the Comopany Bank account.

Onr of the Main Irish life insurance companies has suggested I take out a 'Company Pension Scheme', where the Company, on my Behalf, can input about 200% of my salary. This sounds like a good idea as it will make up for lost time.

The charges quoted are 2% of Premium and 1 % of the Fund 

Is this a good deal ?


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## Guest126 (17 Dec 2006)

It does not sound very inspired, what is the approx annual  contribution you're considering?


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## WillGilbert (17 Dec 2006)

Contributions for first say 3 years I expect to pay in  c 15,00 per year
 to make up for lost time and then mabybe c 3,000 per year

What exactly is uninspring ?

I was comparing it with PRSA , where the annual charge is 5% (versus 2 %)  and the Fund charge (1%) versus 1% which most companies seem to be charging.

The benefits I see are as follows:

1. Going Company reoute... it allows me in effect to contribute way more than a prsa
2. 2% has got to be btetter than 5 %
3. 1% is no more than the 1% quoted by most other companies.


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## Guest126 (17 Dec 2006)

Well we and other execution only brokers set up PRSA for 0 percent contribution fee and a one off payment of 250 so it is clearly uninspiring compared to that, also what investment manager is it - an important decision, and one that you would need to consider.


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## ClubMan (17 Dec 2006)

_CapitalCCC's _0%/1% _PRSA _for a once off fee of €250 seems pretty good to me assuming that it gives you the underwriter/fund(s) that suits your specific needs. Some other brokers may do similar deals but, as we found here on _AAM_ in the past, finding them can be difficult. If it was a choice between _CapitalCCC's _and your other offer then all things being equal I would certainly condider the former unless you can clearly identify good reasons for paying higher charges.


CapitalCCC said:


> also what investment manager is it - an important decision, and one that you would need to consider.


You should probably also consider index tracking funds while you're at it.


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## Guest126 (17 Dec 2006)

I am not so sure that index tracking funds are all that, if an index tracking approach were to be used, a minimum of three different geographic indices should be used, for example a tracker fund that tracks US equities is far too exposed to one economy for my liking.


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## ClubMan (17 Dec 2006)

My comments are not all encompassing financial advice but there is a strong argument for index tracking funds over actively managed funds. Just _Google _for more information if you are interested.


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## Guest126 (18 Dec 2006)

Hi Club - I hope you don't mind me saying, but if I were you I would not believe everything I read on Google.

In particular, bear in mind that 80% to 90% of investment success by Pension Funds is attributable to Asset Allocation and Geographic Selection within Asset Classes.

It seems to me that you are concentrating on the very narrow, and relatively less important area of individual stock selection, when you always mention indexed investing.

Remember that index investing is fine for US Pension Funds that have advisers to help them choose the appropriate Asset Allocation and Geographic split of the assets - it is only when those major decisions have been made that the various indices to reflect those choices are selected.

Index Investing on its own - without consideration of the asset allocation and geographic split - is not really a strategy.


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## WillGilbert (18 Dec 2006)

A no. of people on this forum have said that you can get PRSA for a flat set up amount and then a % (less than or equal to 1 %)

Howvere, only 1 (CapitalCCC was mentioned .. is this an Insurance company , a broker , on line co. or what)

Is this really the case. I saw one thread on this forum with about 15 replies which stated the same thing about a particular insurance company, and the very last thread item mentioned that when they contacted the partcular offerror, the rates were in fact higer than stated.

I would appreciate it if someone could jump in here and list those comapnies which offer a better deal on PRSA's than 1% of the fund and 2% of the premium. Most comments here suggestt that they are difficult to find.... A euphmism for perhaps they dont exist !!!


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## Guest126 (18 Dec 2006)

Capitalccc is a person working for a broker.

Please PM if you want further information.


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## Protocol (18 Dec 2006)

WillGilbert,

yes it is possible to get a PRSA with 0% fees on your contributions and an annual 1% mgt charge.

These low-cost PRSAs are sold by discount insurance brokers.  They are not sold by the life assurer themselves.

To get these policies, you would pay the broker a fee of 150-250 euro. You would get no or very little advice, i.e. you need to know what you want.

Such brokers include www.labrokers.ie in Wicklow and www.myadviser.ie in Dublin. Also maybe try [broken link removed] in Louth


Protocol


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## Protocol (18 Dec 2006)

By the way, the life assurers involved would be Eagle Star and Irish Life.


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## Guest126 (18 Dec 2006)

Protocol - such a deal can be struck with any of the main players, not just those two.


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## F. Kruger (18 Dec 2006)

The Execution Only Fees referred to above are for PRSAs and for this fee WillGilbert would not get any advice. From reading the original post it would appear that WG has procured and already received some advice from someone in relation to a Company(Executive) Pension.

The charges quoted do not seem excessive for a Company Pension Scheme for someone that will probably need advice on an annual basis but only WG can decide if he/she would need this service.  

Why should he/she be looking at a PRSA?


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## Guest126 (18 Dec 2006)

There would be advice included for the policy that I am talking about.

I think for the contribution that WG is talking about 2% and 1% is not a bad deal - I think €500 per annum on a no commission basis would be a better deal but I do not think the 2% and 1% is a bad deal.


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## ClubMan (18 Dec 2006)

CapitalCCC said:


> Hi Club - I hope you don't mind me saying, but if I were you I would not believe everything I read on Google.


_Google _was just a handy reference point. I don't believe everything that it tells me and neither is it the sum total of my reading on such matters!


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## ClubMan (18 Dec 2006)

I don't understand - is the not some contradiction here?


CapitalCCC said:


> It does not sound very inspired





CapitalCCC said:


> I think for the contribution that WG is talking about 2% and 1% is not a bad deal


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## F. Kruger (18 Dec 2006)

CapitalCCC said:


> There would be advice included for the policy that I am talking about.


 


> Well we and other execution only brokers set up PRSA for 0 percent contribution fee and a one off payment of 250 so it is clearly uninspiring compared to that


 
Maybe I am taking this out of context but this does not make any sense to me. You can't offer advice on a execution only basis.

Can you please clarify?


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## Guest126 (18 Dec 2006)

It is an execution only service.

However, if someone wants to talk to me about advice, I will talk to them about it - sorry if that presents a problem for you, but I like discussing investment approaches.

CLUB - no contradiction - the deal is not bad, but it is not inspired.


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## F. Kruger (18 Dec 2006)

Perhaps it would be better if you described the Execution Only Service that someone receives for €250 i.e. Does the client have to complete a Fact Find? Are they provided with a 'Reasons Why' letter?


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## Guest126 (18 Dec 2006)

If the client wishes, of course they can.

Most would not want to have to engage in such form filling, they want investment advice, not to have to answer questions about their mortgage and how much they spend on weekly shopping.


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## daltonr (22 Dec 2006)

This might not be appropriate given the contribution amounts mentioned by the OP, but if the contributions could be increased a bit I'd take a look at a Self Administered Pension Trust.

You're moving up into a different league in terms of investment and the amount of research you may need to do, but it's certainly worth looking into before you make a final decision.

-Rd


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## Guest126 (22 Dec 2006)

Very inappropriate here though, would want to put in €20k/annum for at least 20 years to make one of these worth the extra associated costs.


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