Woeful Fund Performance

S

Sunnygirl69

Registered User
Messages
163
I have a small AVC (<50k) pot with New Ireland started exactly 4 years ago. Just looking this morning, in that time it has grown by 1.11% As a lot of people know it is very difficult to contact New Ireland.
The exact name of the fund is
IRIS Retirement Fund 2034 (6A)
When I go in on New Ireland app, I can't find this exact fund but I can see Passive IRIS Fund 2034, which if I'm understanding the figures properly, says over 3 years it has grown by 18.5%
I'm a HSE worker with 9 or 10 years left working if I stay til 65 or 66 years.

The figures Irish Pensions & Finance gave me for projected growth were fantastic of course. Should I ask about transferring into different fund/mix?

Would love to hear opinions in layman's terms please & yes I do know values can go up as well as down.
 
Sunnygirl69 said:
The figures Irish Pensions & Finance gave me for projected growth were fantastic of course.
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Those projections from all providers are simply based on some assumed and stated annual growth figure, are not indications (never mind guarantees) of what might actually happen, and are largely useless. Other than, perhaps, to compare different options to see what effect charges might have in the long term.
Sunnygirl69 said:
Should I ask about transferring into different fund/mix?
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The first thing is to find out the details of the existing fund.
 
Sunnygirl69 said:
IRIS Retirement Fund 2034 (6A)
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That fund is up about 18% in the past 4 years, but that would only be relevant if you put the full €50,000 into it as a lump sum 4 years ago. If you're investing in it monthly, then the more recent contributions have had less time to grow than the original ones.

That said, I'd suspect that charges are dragging on your performance. Ask IPF to e-mail you details of all charges applying to your AVC and post them back here.
 
I took out a pension with IPF several years ago.
The same thing happened to me when I saw that the fund was not increasing.
You are being screwed with charges and probably a low allocation rate.
Move to another provider asap and tell any of your friends and colleagues to do the same.
 
Keep it simple with pensions - aim for the lowest charges possible and make sure that the asset allocation is appropriate (in most cases a high or all equity managed or passive index tracker fund). If you need advice then try to pay a fixed fee for it to an independent advisor (not a tied agent or other sales person).
 
OK so they replied to me today.
My allocation rate is 97%
Fund management charge pa is 0.75%
Monthly policy fee is €3.81

??
 
One of the posters who knows lot more bout this kind of thing suggested I post charges ie are these charges excessive?
 
Sunnygirl69 said:
OK so they replied to me today.
My allocation rate is 97%
Fund management charge pa is 0.75%
Monthly policy fee is €3.81
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As I expected, these charges are very excessive.

It is possible to get 100% allocation, and avoid paying 3% charge on every contribution.

The 0.75% AMC is okay.

Again, I avoid any firm that charges policy fees.


If you save 200 pm, the contribution charge is 6 + 3.81 = nearly 10 per month.

No wonder the performance is poor!!!
 
Most people on AAM give out about Cornmarket but I believe Irish Pensions & Finance are actually worse for fees on AVC products. My local union promote IPF and encourage new staff members to sign up with them.

Can I ask would it cost this OP anything to switch their fund to another pension provider? Do pension funds sill have entry and exit charges on transfers?
 
I am in the same situation with IPF. I only recently copped the ludicrous fees and poor performance. I'm looking at switching. A challenge for me is I am also considering resigning from my job and moving into freelance work. Are there costs or other issues associated with transferring my AVC and then ceasing or pausing contributions not long thereafter? I won't necessarily be seeking to draw it down for another few years.
 
mendacity said:
Are there costs or other issues associated with transferring my AVC
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It's not clear if the IPF AVCs mentioned in this thread are PRSA AVCs or some other form of pension. If they are PRSAs then there cannot be any penalty for transferring.

Personal retirement savings accounts (PRSAs) - pensionsauthority

A personal retirement savings account (PRSA) is an account you can use to save for your retirement. It is an investment account because you can invest your savings in various investment funds through your account. You can make regular payments or lump sum payments to your PRSA, and these are...
pensionsauthority.ie
PRSAs are portable; you can carry your PRSA from job to job or transfer it to another PRSA provider without any charge or penalty.
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Otherwise there may be and you need to check the policy terms and conditions.
 
If you invested €1,000pm (gross) €966.19 (net) over last 4 years and achieved a net return (after all charges) of 3.5% , your fund would be worth circa €49,700

That would not be a million miles off the performance of a (mid risk) multi-asset fund over that period.

If you're reading that the cumulative fund performance is up 18% over 4 years, that doesn't include the AMC (on New Ireland Funds AFAIK) and certainly doesn't include the drag of a 3% contribution charges and policy fees. Plus, the money is only going in incrementally.

There's something else going on if you're only up 1.11% over the 4 years and my guess at the contribution is close.

AVCs (no disclosure requirements, so not so clear) AVC PRSA (disclosure requirement so more transparency).


Gerard

www.execution-only.ie
 
mendacity said:
Are there costs or other issues associated with transferring my AVC
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If it's an AVC and over €10,000 then current rules say that you need a Certificate of Benefits Comparison (circa €1,500 I'd say) if you want to transfer it to an AVC PRSA. AVC is deemed an Occupational Pension Scheme.

If it's an AVC PRSA and you want to transfer it to another AVC PRSA then there's no CoBC requirement.

That CoBC rule on AVCs might go later this year, hopefully.
 
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