IFA for Pension Fees

**Alan @ BroomeAffinity** · 21 November 2016, 17:14

My IFA takes a flat fee for setting the pension up and that's it. There is pension company charges but those are absorbed into the fund I believe.

**northernladuk** · 21 November 2016, 17:31

**kaiser78** · 21 November 2016, 18:43

Originally posted by rectifier View Post

I'm starting a pension, and having read through here I thought I would explore both options, i.e. doing it myself through a platform like III or using an IFA and getting them to manage it.

I spoke with an IFA and basically the fee structure seemed to be that they would take ~30% of your regular pension contributions in order to manage it for you.

Is that for real? Is that what an IFA charges? Surely if your fund has to grow 30% to just cover the fees then the only person who's retiring rich off this is the IFA?

Just want to know if it's this IFA that's having a laugh or the whole industry is having a collective laugh.

30% is sky high. Look to pay between 0.5-1% max for a good IFA or agree a fixed fee.

**northernladuk** · 21 November 2016, 18:49

Originally posted by kaiser78 View Post

30% is sky high. Look to pay between 0.5-1% max for a good IFA or agree a fixed fee.

Agreed. It's so high it makes no sense. Can't help think someone has made a mistake somewhere.

**rectifier** · 21 November 2016, 18:50

Thanks for that. I thought 30pc sounded daft.

Given that this IFA was the one that is recommended by this site, does anyone have a recommendation for one who isn't a twicer?

**kaiser78** · 21 November 2016, 19:13

Originally posted by rectifier View Post

Thanks for that. I thought 30pc sounded daft.

Given that this IFA was the one that is recommended by this site, does anyone have a recommendation for one who isn't a twicer?

Just double check with them - there must be an understanding somewhere here.

**rectifier** · 21 November 2016, 19:26

Originally posted by kaiser78 View Post

Just double check with them - there must be an understanding somewhere here.

Nope. I talked it through with them on the phone, and the relevant bit of their terms is this:

Should you invest through regular premiums, our range of charges taken over 12 months are:
 Up to 50% of the first £250 of monthly premiums
 Up to 30% of the next £500 of monthly premiums and up to 10% over £750pm.
For a regular premium of £1,000 per month, this would equate to £3,600 (12 x £1,000 x 0.3)

It's a flat charge of 4% if you invest a lump sum, but given that most pension contributions will surely be a regular premium, then 30% seems to be the charge.

Louis Bacon doesn't charge 30%!

Crazy.

**blackeye** · 21 November 2016, 20:18

Name and shame the IFA - 30% is theft. I'd love to talk to them about their services and how they can offer such high YoY return that makes their fees worth while. Even the best fund managers in the world charge a couple of % max.
What surprises me more is they even have the nerve to ask that much, which means people are actually stupid enough to pay them that.

A pension should cost 0.5-0.75% in fees max, ideally less with a self balancing tracker fund.

**kaiser78** · 21 November 2016, 20:26

Originally posted by rectifier View Post

Nope. I talked it through with them on the phone, and the relevant bit of their terms is this:

Should you invest through regular premiums, our range of charges taken over 12 months are:
 Up to 50% of the first £250 of monthly premiums
 Up to 30% of the next £500 of monthly premiums and up to 10% over £750pm.
For a regular premium of £1,000 per month, this would equate to £3,600 (12 x £1,000 x 0.3)

It's a flat charge of 4% if you invest a lump sum, but given that most pension contributions will surely be a regular premium, then 30% seems to be the charge.

Louis Bacon doesn't charge 30%!

Crazy.

Defo look elsewhere, and report them to the FCA for fraud/extortion/improper practises (whatever you want to call it)...

IFA for Pension Fees