PRSA and commission

You mean that in return for making higher contributions, the charging structure has changed as follows:

99.2% allocation rate, 0.8% charge, has been revised to 100% allocation.

The 0.99% AMC has been increased to 1.00%

Is that the case?
 
@Protocol Yep that seems to be the case
@ClubMan sorry dont know what you mean?

But going from .99% to 1% is only a .01% increase, not .1%, makes a huge difference

For example if you are putting away 700pm, with an allocation of .8% = €67 approx per year
Whereas going from .99% to 1% on say 100k (I have no wehere near this yet) is just €10 per year
So I am better off, am I right?
 
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colin44 said:
@ClubMan sorry dont know what you mean?
Click to expand...

PRSA and commission

Heya, I have a PRSA through work, and I have a contact provided from work to set it up.. This PRSA was setup Feb 2024 and the advisor set this up, As I am 50 this year I want to up my AVC's from 25% to 30% So have a meeting with him on Thursday to talk about this, not sure why I just want to...
www.askaboutmoney.com
 
colin44 said:
But going from .99% to 1% is only a .01% increase, not .1%, makes a huge difference
Click to expand...
That's 0.01% on the full value of your fund every year. That could add up to a lot. And, in particular, it could add up to more than paying a once off charge on each contribution.
colin44 said:
So I am better off, am I right?
Click to expand...
Without running the numbers for the two charging scenarios over the likely investment timeframe based on some assumed annual growth level it's difficult to say.
 
Well we do have the figures!

Based on this example, I am way better off?
For example if you are putting away 700pm, with an allocation of .8% = €67 approx per year
Whereas going from .99% to 1% on say 100k (I have no where near this yet) is just €10 per year
My fund would have to reach over 670k to be paying €67 extra a year (@ .01% increase)?

My fund ATM stands at 9k, so .01% of the equates to 90 cent per year, which is better than the current €67 allocation rate of .8% per year?

Is this correct, or am I missing something?
 
I'm genuinely trying to figure out if my above figures are correct, or if Im oversimplifying it, or missing something?
 
You are looking at it too simplistically. You'd need to model it over several years using the total fund increasing with contributions and some assumed growth figure in order to see the overall impact of the two charging structures. You'd probably need to do this in a spreadsheet.
 
Ok thanks, I think I get it, however I think you are being overly pessimistic.. .01% represent 1/10,000 of each years fund value.

It will be many many years before this overtakes the other charge, as I will be paying tthis fund for the nxt 13yrs approx then I will retire

Fund value estimated to be 250k when retire, so a .01% charge only equates to 25 euro well below the 67 per year I currently pay in the other charge.. ?

Is that correct, or am i
Missing something again?
 
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You could be right, but if it was me I'd be looking to sanity check any assumptions. The calculator here may assist:

Pension charges calculator

I've been comparing the PRSA offerings from different providers recently and haven't found a way to easily compare the impact of the various charges applied i.e. all other things being equal, is a PRSA with 0.5% annual management charge (AMC) and 90% allocation better than one with 1.5% AMC and...
www.askaboutmoney.com
BTW even 0% on contributions and 1% AMC isn't necessarily competitive and an even lower AMC should be possible for an execution only/no advice PRSA. E.g. 0.75% or even lower isn't unusual these days.
 
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