Transfering €40,000 from one pension fund to another

[ndp]

I have €40,000 in a pension fund with Equitable Life (net of exit fees). I am going to transfer it out of there, because of all the hassle with Equitable Life, etc.

Any suggestions as to what is the best fund to transfer it into, or on how to go about evaluating which pension funds are the best? (Note: I am now paying into a public service pension fund in my current job.)

Thanks for any advice.

 

[ClubMan]

You might be interested in this thread in you have not seen it already. If some or all of your EL fund is WP then make sure that they are quoting you the correct MVA (6% at the moment as far as I know).

Was this a personal or an occupational pension plan as that may have implications for what sort of new pension product you can transfer to?

When choosing a new pension plan you need to consider several criteria such as charges (up front and ongoing - ideally aiming for 0% and c. 1% annual management fee), fund selection (including asset mix, risk/reward profile etc.), customer service and so on. There are lots of existing threads on such issues. If in doubt get professional advice from an authorised advisor or good multi-agency intermediary. Only deal with a tied agent sales person if you already know that you want their products. They will not give unbiased advice.

 

[ndp]

You might be interested in this thread in you have not seen it already. If some or all of your EL fund is WP then make sure that they are quoting you the correct MVA (6% at the moment as far as I know).

Was this a personal or an occupational pension plan as that may have implications for what sort of new pension product you can transfer to?

When choosing a new pension plan you need to consider several criteria such as charges (up front and ongoing - ideally aiming for 0% and c. 1% annual management fee), fund selection (including asset mix, risk/reward profile etc.), customer service and so on. There are lots of existing threads on such issues. If in doubt get professional advice from an authorised advisor or good multi-agency intermediary. Only deal with a tied agent sales person if you already know that you want their products. They will not give unbiased advice.

Thanks ClubMan for the reply. I read the post you linked with interest before I actually posted this question. I spoke with Equitable Life earlier today, they confirmed the exit penatly (I presume that is the MVA you refer to) is 6%. I don't know to be honest if it was a personal or occupational pension as I don't know the difference between the two. I'm always a bit sceptical about financial advisors. My experience in the past had has been that they advise you to go with the one that returns them the best commission as opposed to what is best for you. Having said that, I clearly need help! How do you know the financial advisor is giveing you the best advice for you?

 

[ClubMan]

I spoke with Equitable Life earlier today, they confirmed the exit penatly (I presume that is the MVA you refer to) is 6%.

Yes - MVA = Market Value Adjustment. I think EL call this a Financial Adjustment or something like that. Ultimately it's a chunk of a With Profits fund deducted for early encashment/transfer. Unless you are near retirement I would imagine that you are probably better off switching from EL as I did and maybe even investing in something with a higher risk/reward profile than the WP fund that you have been in to date. However what's right for you depends on your specific circumstances so get professional advice if necessary.

I don't know to be honest if it was a personal or occupational pension as I don't know the difference between the two.

The policy document should say "personal pension" or the policy number should be something like "PPPI...." if it's a personal pension plan.

I'm always a bit sceptical about financial advisors. My experience in the past had has been that they advise you to go with the one that returns them the best commission as opposed to what is best for you.

That should not be the case with a well chosen authorised advisor or milti-agency intermdiary. There are some recommendations in existing threads for discount brokers that fit the bill here. I would certainly recommend at least checking out the likes of

www.ferga.com
www.myadviser.ie
www.labrokers.ie
www.prsas.ie

and maybe others. I think they are all sometime AAM contributors and seem to me to be dependable/reputable.

Having said that, I clearly need help! How do you know the financial advisor is giveing you the best advice for you?

First off you need to make sure that they are not a tied agent. Then you need to find out how many agencies with product providers they hold. Then you need to set out as clearly as possible what you are looking for and perhaps agree a fixed fee rather than commission based remuneration. Best to get recommendations from satisfied customers too.

 

[ndp]

The policy document should say "personal pension" or the policy number should be something like "PPPI...." if it's a personal pension plan.

Thanks again ClubMan. My plan is a personal plan so as it has "PPP" at the start of the policy number.

 

[ClubMan]

So you could, for example, open a new PRSA with low charges (e.g. 0% on each contribution and c. 1% annual management fee) and a suitable fund selection for your needs and transfer into that. Or another personal pension plan. These are not specific recommendations but just general suggestions. You need to shop around and maybe get advice on what's suitable for your specific needs. There are lots of threads that are worth reading for background info on this.