12 replies to this topic

[Truly Skint]

Hi all

 

Can anyone advise what annual charge to expect from an IFA for tending to my pension interests

 

I have a pension wrap which is reviewed annually during a home visit by the IFA. I am not at pensionable age yet so this is all pre-drawing down

 

What charges should I expect for this service and what is the charge based on ie: fixed fee or percentage of the fund?

 

Can I also ask whether they generally charge for any activity such as changing funds in which they invest my pension

 

Thanks

[AlfaAversion]

I thought it was law that they could only charge a percentage one off fee for the service.
I found under 2k they CBA

[Jbguy]

Hi there, 

 

The majority of IFA's will charge on a percentage basis for ongoing advice, this typically is around 1% of the whole investment/pensions etc. This 1%pa includes all ongoing services, reviews, fund switches, withdrawals, contributions and so forth.  

 

The norm would also include an initial advice fee and this varies quite a lot firm by firm. They may charge £500, £1000, a percentage of the portfolio i.e. 1 to 3%, or even nothing at all. This will all depend on how much work needs to be undertaken.

 

 

Alternatively some companies will charge on an hourly rate, I have no experience of this first hand but I believe £100-200 an hour is expected.

 

Or it could be a fixed fee, which would normally be the case if you did not wish to have ongoing advice. Again the cost could vary significantly depending on the IFA and the amount of work required.

 

Whatever the case, it should be fully disclosed. Hope this helps!

 

James

 

[hairy]

try asking on https://www.lemonfool.co.uk//

 

they're a helpful bunch.

[Ivor]

Hi there,

The majority of IFA's will charge on a percentage basis for ongoing advice, this typically is around 1% of the whole investment/pensions etc. This 1%pa includes all ongoing services, reviews, fund switches, withdrawals, contributions and so forth.

The norm would also include an initial advice fee and this varies quite a lot firm by firm. They may charge £500, £1000, a percentage of the portfolio i.e. 1 to 3%, or even nothing at all. This will all depend on how much work needs to be undertaken.


Alternatively some companies will charge on an hourly rate, I have no experience of this first hand but I believe £100-200 an hour is expected.

Or it could be a fixed fee, which would normally be the case if you did not wish to have ongoing advice. Again the cost could vary significantly depending on the IFA and the amount of work required.

Whatever the case, it should be fully disclosed. Hope this helps!

James

Exactly this, I have one ifa who charges a disclosed annual fee (% of deposit) and another who charges a one off fee of the deposit value again fully disclosed prior to commitment

[Pidgeon]

St. James' Place wanted 4%, the company scheme is through Scottish Widows, their local IFA Johnson Fleming charge 2% on transfer.  I hate paying any charges, but appreciating this is probably the most critical decision in my remaining financial life, bolstered by positive reports from colleagues, I paid up.

 

This was to transfer from the Scottish Widows investment into a drawdown vehicle, for when the time comes.

 

Given that I'm in 'safe' funds, it's comfortably outperforming a 'risky' ISA I opened as comparison.

[Ivor]

St. James' Place wanted 4%, the company scheme is through Scottish Widows, their local IFA Johnson Fleming charge 2% on transfer. I hate paying any charges, but appreciating this is probably the most critical decision in my remaining financial life, bolstered by positive reports from colleagues, I paid up.

This was to transfer from the Scottish Widows investment into a drawdown vehicle, for when the time comes.

Given that I'm in 'safe' funds, it's comfortably outperforming a 'risky' ISA I opened as comparison.

Does your state pension get taxed? I don't know anyone else who's drawing it

[Ormes]

I thought RDR did away with commission or % based advisor fees and should now charge in a way that is not directly linked to the size of the deposit? Wrap platforms typically charge a platform or management fee which is % of holdings but can also charge dealing fees and other charges on top of that.

[kipper]

St. James' Place wanted 4%, the company scheme is through Scottish Widows, their local IFA Johnson Fleming charge 2% on transfer. I hate paying any charges, but appreciating this is probably the most critical decision in my remaining financial life, bolstered by positive reports from colleagues, I paid up.

This was to transfer from the Scottish Widows investment into a drawdown vehicle, for when the time comes.

Given that I'm in 'safe' funds, it's comfortably outperforming a 'risky' ISA I opened as comparison.

Does your state pension get taxed? I don't know anyone else who's drawing it

Yep, the state pension is taxable!

[Jbguy]

I thought RDR did away with commission or % based advisor fees and should now charge in a way that is not directly linked to the size of the deposit? Wrap platforms typically charge a platform or management fee which is % of holdings but can also charge dealing fees and other charges on top of that.

[Jbguy]

I thought RDR did away with commission or % based advisor fees and should now charge in a way that is not directly linked to the size of the deposit? Wrap platforms typically charge a platform or management fee which is % of holdings but can also charge dealing fees and other charges on top of that.


RDR got rid of the advisers themselves earning commission on any advice given. The % ongoing service fee is paid directly to the company themselves, for them to then decide what an adviser is paid... whereas in theory pre RDR a highly paid adviser earning commission directly for whatever they ‘sold’, may not have been acting in the clients best interest at all. The ongoing service % fee to the company means that an IFA practice has a duty by law to produce you with a service, which includes all periodic valuations, fund switches, tax calculations etc at no further cost

[Ivor]

St. James' Place wanted 4%, the company scheme is through Scottish Widows, their local IFA Johnson Fleming charge 2% on transfer. I hate paying any charges, but appreciating this is probably the most critical decision in my remaining financial life, bolstered by positive reports from colleagues, I paid up.

This was to transfer from the Scottish Widows investment into a drawdown vehicle, for when the time comes.

Given that I'm in 'safe' funds, it's comfortably outperforming a 'risky' ISA I opened as comparison.

Does your state pension get taxed? I don't know anyone else who's drawing it

Yep, the state pension is taxable!

I meant was pigeon's state pension taxed.....

[Truly Skint]

Thank you all for your contributions, at least I now know that Im not being ripped off