The cheapest PRSA?

A PRSA is a commodity product that should be relatively simple and low cost.

Unfortunately, the legislation designed to create the structure has had two probably unintended consequences.

Firstly, the max charge imposed by the legislation has become the default position rather than the max.

So a default charge is still 5% contribution fee plus 1%pa

The second problem arises because the legislation specifies fee disclosure in a particular way which can make some genuine lower cost options appear more expensive when disclosed in the statement of reasonably projection whereas contracts with demonstrably higher costs can appear cheaper.

Simply complying with the legislation is the reason often cited by pension providers for the floor reached on charges.

The base wholesale cost for a PRSA in Ireland is still 0.50%pa simply due to the onerous reporting and compliance regime.

On top of that you need to add fund management and any advice/distribution costs.
 
He-Man said:
It's been a long time since this thread was updated; who are the cheapest PRSA providers now?
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labrokers.ie/pensions/ has two PRSAs with 1% AMC - no contributon charge

Davy is offering 0.75% +x (x depending what type of ETF you chose - with the right ETF you can stay below 1%)
 
So, in a PRSA, can you build your own portfolio with, say, three or four different ETFs? What about rebalancing, i.e. are you allowed to sell some of one ETF to buy more of another ETF in one's portfolio? Do dividends generated by such ETFs incur a tax?
 
Yes you can build your own portfolio with Davy. I believe rebalancing is possible (but you should check with Davy directly or someone else can advice here who is already with them) and I would be surprised if any dividends would be taxable as they are locked in your PRSA and PRSAs are tax exempt (DIRT/DWT)...
 
Not bad. So you can build a portfolio of Ireland-domiciled Vanguard ETFs for example. Doing this, you could generate a globally diversified portfolio for no more than 0.12% TER, in terms of Vanguard commission at any rate.
 
I have asked beginning of February the Pension Authority to provide me with an overview of all PRSAs and their costs - after some initial reluctance / deflecting and after I involved their Freedom Of Information Act Officer I was promised beginning of March that I should receive this information by the End of March. I was chasing them today again but she is out of office for now.
They also consider to republish this information as well on their website as they did in the past.


So far Davy seems really to be the cheapest (unless there are some transaction charges I am not aware of) one but I will wait with opening a PRSA for my fiancee till I am getting their response.
 
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Hi merowig
You might post that info here when you get it.
Well done for being so proactive !
Mtk
 
Got a response today - they got delayed - I was told that I should get it hopefully in two weeks.
Will copy and paste it here (File uploading doesn't seem to be possible) when available....
 
I have a non standard PRSA with Bastow Charleton Wealth Management which is costing c.0.5% and invested mainly in property.
 
Perhaps an older PRSA or some kind of individual discount or perhaps because of the fund value you have there? Their website [broken link removed] reflects what is in the excel.
 
thanks but so many variations makes it hard to follow..... to state the obvious....to keep the consumer in the dark or force them to use an intermediary ?
 
Practically I believe the previous statement is still valid - a PRSA through LA brokers and Davy seem to be the cheapest ones (unless you have huge amounts of money to invest).
 
mtk said:
thanks but so many variations makes it hard to follow..... to state the obvious....to keep the consumer in the dark or force them to use an intermediary ?
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Hi mtk,

The variations are there for the benefit of the provider and the intermediary. The provider doesn't want to lose business by just offering one charging structure and the intermediary might want to reduce the contribution charge (the 5%) depending on the level of contribution.

The way I look at it is, there are two types of PRSA, one with a contribution charge (that pays for advice) and one without a contribution charge (no advice/execution only).

BTW, prsa (dot) ie (my own site) also does a prsa with no contribution charge and a 1% amc on an execution only basis. And, if you want to buy another type of pension product (PPP, BoB, AVC, EPP or A(M)RF) with no contribution charge you can do this via the website.
 
Reactions: mtk

The Pensions Authority has now published in August an updated Excel file with an overview of all charges and providers
http://www.pensionsauthority.ie/en/I_want_to_start_a_Pension_PRSA/PRSAs/
 
Pension regulator website has a 2020 version of the previous linked list. Can’t seem to link it to update the thread.
 
I'm always interested in why things cost so much more in Ireland.

What is the reporting and compliance regime like? Is there anywhere where I can read about what is involved?

I know the regulator charges 0.05% of AUM. What else is adding to that cost?
 
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