I would expect to be able to get better pricing on an ARF, as PRSAs have to pay 0.05% of their value to the Pensions Authority each year
There was a time when that was a certainty but something has changed in the past while with some providers. I'm not sure whether it's by design or error but I'd be leaning towards the latter. Good for the consumer and competition though.
There are anomalies in some of the Royal London & Standard Life product offerings. I'm not an actuary but the following wouldn't really 'add up' for me. Maybe the smaller players are leaner and have less operating unit costs? My own small buiness experience is that costs are on the up-and-up.
The base AMC (
no distribution margin) for
one SLAC PRSA (with a low ish minimum threshold?) is 0.40% and we know they have to pay 0.05% to Pensions Authority out of that. That base AMC is lower than what the provider offers on (say) an life assurance investment, to the best of my knowledge, with no PA fee to pay. I did pose the anomaly to the company once, but didn't get a reply.
The base AMC for Non-Standard PRSA and ARF with RL are the same @ 0.40% so I'm sure they'd prefer that you bought an ARF, post retirement , than a Vested PRSA as the ARF has more margin in it by the saving, to them, on the 0.05%. Plus, it's highly likely to be on a reducing balance basis.
The base AMC on a PRSA with the three biggest pension players is 0.50% and their other product offerings would typically have a lower base AMC.
Gerard
www.prsa.ie