# Rabodirect PRSA - right for me?



## invest-or (11 Oct 2009)

I'm 40, self-employed (sole trader), with no pension, but a lot of savings (6 figures). I rent at the moment, but may buy a house in the next few years.

I see the government plans to reduce tax relief on pension contributions to a maximum of 30% (see http://www.independent.ie/national-...evies-will-now-be-made-permanent-1910468.html ), so figure this is a good time to get that damned pension started, and a make a large lump sum contribution before I submit my tax return for Oct 31st.

Rabodirect / Zurich Star (Eagle Star funds) are offering a PRSA with commission on contributions at 0.5% (if you contribute 30,000+ initially, and 1000+ per month, which I can manage okay), and a 1% annual management fee - see [broken link removed]

I know there are some 0% commission "execution only" brokers out there, but 0.5% seems reasonable. Better than paying 5% to a broker anyway.

I know I should do tons of research to make the "right" decision, but if I don't get the research done (due to lack of time, laziness, etc.), surely it's better to get started on my pension with *something* which is reasonably right for me, rather than prevaricate even longer searching for that 100% perfect product.

Any advice / suggestions?


----------



## bawaugh (11 Oct 2009)

Doing something about your pension is far better than doing nothing about it, and relying on the state pension only at retirement. Get started now, if you find you are in the wrong fund you can always move your PRSA money without any transfer fees to a better fund in the future. Remember also that past performance is no guarantee of future results.

However you can improve the performance of your fund by reducing the fees you pay. You should have as much money as possible being invested into the fund. Why pay fees you do not have to, it is your money.

If you want a PRSA that charges 0% on your contributions you can go to LA Brokers at  where you can get details of a number of PRSA products with no charge on your contributions, meaning that 100% of your cash is invested. I got my PRSA started through them and I am happy with their service.


----------



## z101 (13 Oct 2009)

I thought the whole thing with the PRSA was that their was an 5% set up costs, and this was set by the government so as to make it standard for the public. This gives an allocation rate for PRSAs of 95%.
A personal pension can have higher allocation rates and give access to more funds, but you cant move provider for 5 years.
Annual charges are normaly about 1%


----------



## invest-or (13 Oct 2009)

Ceatharlach said:


> I thought the whole thing with the PRSA was that their was an 5% set up costs, and this was set by the government so as to make it standard for the public. This gives an allocation rate for PRSAs of 95%.



Standard PRSAs have a MAXIMUM of 5% charge on contributions, and MAXIMUM 1% per annum for fund management. Some "execution only" brokers like LA Brokers charge 0% commission on contributions. Going for 0% is a bit of a no-brainer, if you know what you're doing. 5% over the life of a pension could add up to a LOT of dosh.


----------



## LDFerguson (14 Oct 2009)

Ceatharlach said:


> A personal pension can have higher allocation rates and give access to more funds, but you cant move provider for 5 years.


 
Only a small few providers charge penalties for moving providers in the first five years.  Most Personal Pensions allow you to move at any time without penalty.  

Annual fund charge with most Personal Pensions is 0.75% for many fund choices.


----------



## LDFerguson (14 Oct 2009)

invest-or said:


> I know there are some 0% commission "execution only" brokers out there, but 0.5% seems reasonable.


 
Rabo Direct is also an execution-only intermediary for PRSAs.


----------

