# Best value Self-Directed AVC PRSA for a 10-15K lump sum?



## gbh2930 (17 Feb 2014)

Does any provider offer a stand-out deal or are they all the same?


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## Steven Barrett (18 Feb 2014)

They are all more or less the same. The charging structure of standard PRSA's are laid down in legislation so they have to be the same. 

For self-directed, you will be a non-standard PRSA. I use Standard Life for those as they use Stocktrade as their traders, who are relatively cheap and easy to use. 


Steven
www.bluewaterfp.ie


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## letitroll (17 Jan 2017)

Reviving this thread as it seems broadly in line with my query.

I'm in occupational scheme in work - so any additional pension would be classed as an AVC I presume. Maybe I'm getting bogged down in labels but does that give me less choice in terms of choosing a pension structure for additional contributions?

I'm currently in a Zurich PRSA AVC (through LA Brokers) which is OK at 1% AMC but the lack of transparency on fees/expenses at a fund level and my growing lack of believe in ANY fund manager / stock pickers ability to deliver anything but average returns at best has me looking at other options for my 30yr investment horizon.

My ideal structure is a super low cost self directed pension fund which holds ETF index funds with an AMC of c. 0.05%. I've become quite convinced of the benefits of indexing i.e. getting average market returns overtime and allowing them to compound while ensuring the compounding of costs don't impede the returns!

Given my circumstances i.e. already in occupational scheme - who provides something suitable for me in the Irish pension market? Whats the lowest theoretical AMC you can get down to if I held only a Vanguard S&P 500 ETF with a 0.05% AMC or iShares 500 at 0.04%?


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## Steven Barrett (17 Jan 2017)

Don't confuse the fund manager's fee with the product providers. You will still have to pay between 0.5% - 1% AMC to the company that provides the PRSA product that you invest through. 


Steven 
www.bluewaterfp.ie


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## letitroll (17 Jan 2017)

SBarrett said:


> Don't confuse the fund manager's fee with the product providers. You will still have to pay between 0.5% - 1% AMC to the company that provides the PRSA product that you invest through.
> 
> 
> Steven
> www.bluewaterfp.ie



Thanks Steven - aware of that i.e. Davy's for example need their AMC, then the product itself Vanguard or whom ever have have a fund fee that sits on top.

My question was whether there is a self-directed pension product for an AVC contributor like me or am I forced to go get a plain vanilla PRSA AVC with the standard 1% AMC and limited fund choices i.e. all actively managed


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## Gordon Gekko (17 Jan 2017)

There is no such product.

With the greatest respect, €15k is a trivial sum; 1% is €150.

What about just sticking with the 1% and then allocating the money to something like Zurich's International Equity fund?

Yes it may underperform or outperform depending on the particular year, but it should do fine overall. An alternative would be to go Self-Directed through a stockbroker. Going down that road, you'd probably end up paying 1% a year for the structure and then the small AMC for the ETF, but I'd be surprised if such a small amount would be accepted.


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## martin (17 Jan 2017)

Davy Select has a self-directed PRSA at 0.75% AMC, 100% allocation rate. There may be cheaper options, but I'm not aware of any. One of the funds they offer is a Vanguard S&P 500 ETF at 0.07% TER.


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## Gordon Gekko (17 Jan 2017)

martin said:


> Davy Select has a self-directed PRSA at 0.75% AMC, 100% allocation rate. There may be cheaper options, but I'm not aware of any. One of the funds they offer is a Vanguard S&P 500 ETF at 0.07% TER.



There you go. Would they accept €15k on those terms though? €113 a year for all of that admin and risk doesn't sound plausible. Surely there's a minimum?


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## martin (17 Jan 2017)

Gordon Gekko said:


> There you go. Would they accept €15k on those terms though? €113 a year for all of that admin and risk doesn't sound plausible. Surely there's a minimum?



Yes. I don't think there is a minimum value you need to invest, but if there is, it's definitely lower than 15k.

Everybody has to make their first pension investment at some point, and when they do, I'd imagine that the first investment often isn't very large (compared to the balance of an average PRSA that has been around for longer). Investment balances are likely to grow over time as more money is put into the account, but if a provider doesn't accept that initial investment, then I'd imagine that they're also less likely to see the larger amounts later on.


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## letitroll (18 Jan 2017)

Gordon Gekko said:


> With the greatest respect, €15k is a trivial sum; 1% is €150.



The sum would be much larger than this - the 15k was the original posters total


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## Gordon Gekko (18 Jan 2017)

letitroll said:


> The sum would be much larger than this - the 15k was the original posters total



How large? You've since edited your post.


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## Merowig (18 Jan 2017)

Gordon Gekko said:


> There you go. Would they accept €15k on those terms though? €113 a year for all of that admin and risk doesn't sound plausible. Surely there's a minimum?


I was in contact with Davy last year when I searched for a suitable PRSA for my wife and they don't have a minimum contribution. You can pause as well any time your contributions like with any other PRSA.


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## letitroll (22 Jan 2017)

Gordon Gekko said:


> There is no such product.
> 
> With the greatest respect, €15k is a trivial sum; 1% is €150.
> 
> ...



Amount of initial investment is irrelevant (mine because you asked above is closer to three figures) - as others have said a pension journey is 30yrs and a pension company will happily take 15k knowing it will grow overtime - a 1% fee on a sum compounding over 30yrs turns out to be a very nice business model!

In regard to your put it into Zurich X fund and you should be grand advice. I think the evidence bears it out that vast universe of funds / fund managers / stock pickers by definition turn out to be average over time. What else could they be - for every fund that sells a share of Apple thinking it will go down there is of course a fund who buys that share of Apple thinking it will go up (all the while trading back and forth with each other trying to beat each and incurring trading fees (guess who pays for those- the investor)). My investment horizon is 30 years - lets presume the Zurich International Equity fund has a Nostradamus fund manager right now (from a brief look it doesn't its underperformed the S&P 500 / FTSE 250 fairly significantly). Lets say it did outperform however - the average fund managers tenure managing a fund is maybe 6-7yrs, over 30yrs lets count 5 maybe 6 different fund managers will manage my money at Zurich international fund - will all 5/6 be rockstar managers? Do I want or need to be checking the staff rotation at that fund. I bet some will be above, some will be below, some will be poor managers but get lucky others the opposite but over 30yrs the probabilty says they'll be average. Average all the while charging me the investor money for their incessant trading back and forth, following hunches & blind attempts to try and time the market etc. etc.


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## Gordon Gekko (22 Jan 2017)

The S&P and FTSE aren't really relevant in terms of an international equity fund; it's the MSCI World one should be looking at.


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## letitroll (23 Jan 2017)

Gordon Gekko said:


> The S&P and FTSE aren't really relevant in terms of an international equity fund; it's the MSCI World one should be looking at.



What one should be looking at is gross returns achieved minus costs.

The S&P 500 & FTSE 250 indexes have destroyed MSCI World & Zurich's Int Equity fund in terms of performance. One could argue of course that because the S&P 500 is made up of companies that derive 50% of their earnings and 50% of their profits from outside the US it is also an excellent international equity index. MSCI World itself is made up of 60% US equities with another near 7% from the UK.

If the Zurich Int Equity fund manger would like to kid himself then he can benchmark himself against the MSCI World Index but ultimately if taking his fiduciary responsibilities seriously he should be asking given the availability of passive low cost (0.05%) diversified vehicles like an S&P500 fund or FTSE 250 whether he's providing incremental value or simply ensuring the "value" is being captured by himself the fund manager and indeed the fund provider.

Given the stock market is a closed system it is self evident that for every "smart" manager/fund there has to be a "dumb" one. Indeed when you even look at these outperforming funds then turn out to be not that smart for very long. Sure they might outperform for a while and even when they do they don't outperform by very much and certainly not by enough to escape the destructive gravity of their incessant trading, errors & overheads.


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## Ted110 (14 Sep 2020)

Did anything further come of this?

I'm in an AVC PRSA and ALL I want to do in the world is have it self-directed through Zurich into the S&P 500 (VUSA) ETF. . . . That's it! 
I don't want any other advice or other ETF's. . .  I just want That. . . Is that possible? Can that be done?


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## LDFerguson (17 Sep 2020)

Ted110 said:


> Did anything further come of this?
> 
> I'm in an AVC PRSA and ALL I want to do in the world is have it self-directed through Zurich into the S&P 500 (VUSA) ETF. . . . That's it!
> I don't want any other advice or other ETF's. . .  I just want That. . . Is that possible? Can that be done?



Standard Life's AVC PRSA can access [broken link removed].  Annual charge 0.9% including the AVC PRSA and the fund, or 0.65% for a transfer of >€100,000.

Regards,

Liam
www.ferga.com


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## letitroll (17 Sep 2020)

LDFerguson said:


> Standard Life's AVC PRSA can access [broken link removed].  Annual charge 0.9% including the AVC PRSA and the fund, or 0.65% for a transfer of >€100,000.
> 
> Regards,
> 
> ...



@LDFerguson 
Is transferring your existing pension holdings from say a Zurich PRSA AVC fund into this Standard LIfe PRSA AVC a big job? Can you go direct to Standard Life or is this transfer product accessed through a broker


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## LDFerguson (17 Sep 2020)

letitroll said:


> @LDFerguson
> Is transferring your existing pension holdings from say a Zurich PRSA AVC fund into this Standard LIfe PRSA AVC a big job? Can you go direct to Standard Life or is this transfer product accessed through a broker



Not a big job.  Application form for the Standard Life AVC PRSA, which would be similar to the one you completed previously.  Written instruction to Zurich Life.  Zurich Life will require confirmation from Standard Life that you have an AVC PRSA.  

I'm not 100% sure what Standard Life will do if you contact them directly.  As far as I know, they don't have a direct sales unit.  They might refer you to a broker or they might just set up the product for you themselves.  Either way, you won't benefit by going direct as they won't undercut their main source of business - brokers.  In the interests of full disclosure I am a broker so my opinions on this could be perceived as biased but anything I've said can be verified easily.


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## Zenith63 (17 Sep 2020)

LDFerguson said:


> Either way, you won't benefit by going direct as they won't undercut their main source of business - brokers


FWIW in my case, 1.25% AMC via a broker, 0.75% AMC direct to Zurich for the same product.  Maybe there are cheaper brokers that would have also done it at 0.75% but I could not find one.  Worth the call I think.


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## LDFerguson (17 Sep 2020)

Zenith63 said:


> FWIW in my case, 1.25% AMC via a broker, 0.75% AMC direct to Zurich for the same product.  Maybe there are cheaper brokers that would have also done it at 0.75% but I could not find one.  Worth the call I think.



Was this a PRSA or AVC PRSA?


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## Zenith63 (17 Sep 2020)

LDFerguson said:


> Was this a PRSA or AVC PRSA?


Executive Pension. Slightly different I know, just making the point that these companies do seem willing to undercut their brokers and the saving can be significant.


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## LDFerguson (17 Sep 2020)

Zenith63 said:


> Executive Pension. Slightly different I know, just making the point that these companies do seem willing to undercut their brokers and the saving can be significant.



Thanks.  If I thought that they had offered a customer a 0.75% AMC PRSA I would have been a bit miffed.  

That said, 0.9% AMC (or 0.65% AMC for >€100,000) for PRSAs and AVC PRSAs is Standard Life's lowest offering for brokers.  So even if Standard Life can accept business directly from the public, I can't see how they could undercut their lowest charge.  Whatever broker you went to for your EPP didn't offer you Zurich Life's lowest AMC contract and Zurich Life do have a direct sales team.  I can understand how one of Zurich's direct sales reps would be able to beat your broker - you could have got 0.75% from a broker, so they weren't undercutting brokers in general.


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## letitroll (18 Sep 2020)

LDFerguson said:


> Not a big job.  Application form for the Standard Life AVC PRSA, which would be similar to the one you completed previously.  Written instruction to Zurich Life.  Zurich Life will require confirmation from Standard Life that you have an AVC PRSA.
> 
> I'm not 100% sure what Standard Life will do if you contact them directly.  As far as I know, they don't have a direct sales unit.  They might refer you to a broker or they might just set up the product for you themselves.  Either way, you won't benefit by going direct as they won't undercut their main source of business - brokers.  In the interests of full disclosure I am a broker so my opinions on this could be perceived as biased but anything I've said can be verified easily.



Thanks Liam - appreciated

And just to be clear this is to transfer into Standard Life, the non-Standard PRSA AVC referenced at the top of this thread - the one where you get access to Stocktrade and much wider pool of investments?


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## LDFerguson (18 Sep 2020)

letitroll said:


> Thanks Liam - appreciated
> 
> And just to be clear this is to transfer into Standard Life, the non-Standard PRSA AVC referenced at the top of this thread - the one where you get access to Stocktrade and much wider pool of investments?



That's correct.  

Just to be clear also, Standard Life have an agreement with Vanguard whereby Standard Life resell a choice of six Vanguard funds alongside their own Standard Life funds.  These are fund choices and therefore the 0.9% or 0.65% AMC is the annual cost of both the PRSA / AVC PRSA product and the funds.  

If you choose Stocktrade, the AMC is 1% or 0.75% and that's just the cost of the PRSA / AVC PRSA.  If you then go via Stocktrade into an ETF or other investment with its own AMC, then the investment's own AMC will be on top of the Standard Life AMC.  Hope that makes sense.


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## letitroll (20 Sep 2020)

LDFerguson said:


> That's correct.
> 
> Just to be clear also, Standard Life have an agreement with Vanguard whereby Standard Life resell a choice of six Vanguard funds alongside their own Standard Life funds.  These are fund choices and therefore the 0.9% or 0.65% AMC is the annual cost of both the PRSA / AVC PRSA product and the funds.
> 
> If you choose Stocktrade, the AMC is 1% or 0.75% and that's just the cost of the PRSA / AVC PRSA.  If you then go via Stocktrade into an ETF or other investment with its own AMC, then the investment's own AMC will be on top of the Standard Life AMC.  Hope that makes sense.



Makes perfect sense - and something I think I'll tackle in 2021with your help. Thanks again.


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## weeslip (26 Apr 2021)

Sorry to dig up an old thread. I'm having some issues with Stocktrade, no Crypto of any kind even ETF, etc and very slow to add newly IPO'd equities. A case in point is UIPath. Was speaking to a lovely gentleman today who told me it could be 2/3 weeks, maybe more before their third-party provider added this equity as it was yet to have a CREST number. 

Any other viable alternatives in the Pension trading market?


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## Zmicier (8 May 2021)

Could you help me with two basic questions regarding self-directed PRSA? As far as I understand, I may decrease my taxation by making retirement contributions to PRSA. However, I would like to invest myself and partially to small cap stocks on US markets. Are there any PRSA providers who allow such self-directed investments?

Also at what age can I start to take back my investments tax-free (my occupation is firmware engineer if it matters)?


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## SPC100 (9 May 2021)

I had forgotten about this old thread, and just wanted to summarise the information in it. I think this is still the cheapest for self directed prsa?

Cheapest self directed PRSA or AVC PRSA
*Davy *.75% AMC + charges of any etf/fund you buy.
*Standard life* min 100k transfer, .75% AMC + charges of any etf/fund you buy., or .65% for 6 inhouse vanguard funds with 0 additional fund fees.

edit: From @Steven Barrett here it seems the .65% in vanguard funds option is only good for a single large transfer. Additional contributions have 5% monthly/2.5% one off contribution charge.

edit2:* In other theads commentators have said a personal pension would have lower costs. *And you can't transfer from a PRSA to a personal pension.


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## SPC100 (9 May 2021)

In summary, Davy was the cheapest in 2012 (when I first did my research), and seem to still be the joint cheapest in 2021?


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## Zmicier (11 May 2021)

SPC100 said:


> *Davy *.75% AMC + charges of any etf/fund you buy


In their fees I see:


> Minimum Fee per trade for each instrument listed outside Ireland and UK - 0.06%





> Foreign Transaction Settlement Charge per trade for each instrument listed outside Ireland and UK - €25.00


For example, I want to buy US stock (one ticker) for an equivalent of 1000€. How much comission will I pay in such case? As far as I understand, (1000 * 0.75%) + (1000 * 0.06%) + 25€ = 7.5€ + 0.6€ + 25€ = 32.56€. Am I right? If not, how to calculate comission correctly for US stocks?


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## SPC100 (11 May 2021)

.75% is the annual fee, not part of purchase fees.


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## Zmicier (15 May 2021)

SPC100 said:


> .75% is the annual fee, not part of purchase fees.


Thanks. As far as I understand, if I my portfolio value is 100k€ then I will be charged 750€ as AMC in this year. Am I right?


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## SPC100 (15 May 2021)

Zmicier said:


> Thanks. As far as I understand, if I my portfolio value is 100k€ then I will be charged 750€ as AMC in this year. Am I right?


Yes.
 Although they actually charge .75%/2 every 6 months. So you would be charged 750/2 and 6 months later charged .75%/2 on the value of your account on that day.


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