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I posted in a similar vein last year - fortunate position of having a work pension from some time ago and a SIPP that is self-managed. Plus one ISA that is externally managed and one self-managed. With my mum's death, things got quite complicated, we have engaged a financial adviser to go through options. Result of review is OK in parts but not certain on others.
Obviously we will make that point, but it's such a minefield of an area with vested interests and points of view; the options seem to be retain the self-managed stuff (with risk I'm not good at it) or full-on externally managed with quite large fees.
I could do with some triangulation - get another opinion even informally, to see whether the likes of (but not limited to) index tracker funds or Fundsmith and ilk are viable options; I fear they have not been mentioned as there are little fees involved (and we would then need to select - thus still retaining some decisions, and not consolidating, which would be obvious).
Is a third, low risk with low ish fees a viable third way - first world problems and all that, but I'm a little lost the more I dig into this rabbit hole.
Thanks!
or full-on externally managed with quite large fees.
Define large?
I have one pension managed by a local wealth mgmt company, fees are 1%. Their fund is a custom blend of trackers / bonds weighted to my risk profile but total fund fees and platform fees are another 0.3%, so overall fees are 1.3%.
The bulk I just managed myself an a mix of SIPPs and ISAs.
The cheapest option would be to use Vanguard platform and their managed funds - very low fees.
Good question @footflaps. Reasonably detailed analysis sheets show that my self-managed ISA is running a weighted cost of around 1.22% (underlying funds range between 1.00 and 1.74%); annual costs are minimal, through ii, works out around 0.03% - 1.25% in all.
I need to work out exactly what is described as ongoing fees and what are one-off - it looks like they're taking 1% as a cut on any transfer, which obviously is going to make regaining any growth much harder.
Once the cash ends up with the fund manager, it's running at about 1.31% fees all in, at current investments - that might be lower (or higher). That's not to bad but it's due to other ongoing stuff - relating to my mum's investments.
On reflection, it's the transfer costs that - while visible - kind of stick in the throat.
(underlying funds range between 1.00 and 1.74%);
That seems quite high....
The 1% annual fees / 1% on transfers in is fairly normal, although some companies don't charge on additional deposits but they then are subject to 1% annual fee. I don't intent to add any more so the 1% on transfers doesn't affect me.
I guess it all depends on how much growth you get and whether you're just paying 1% to buy a FTSE tracker you could just buy through Vanguard for 0.1% fee.
I only use a IFA for one pension as going through them was the only way I could cash out a final salary pension which had lost all the benefits of DB due to falling into the Pension Protection Fund, so wasn't really DB anymore.
This is the bunch I use: https://www.provisio.co.uk/our-team/
cheers - that's good to get an external "that seems quite common" handle as that's what I lack (not swapping about in general). $64,000 question is the growth one would expect - it's not going in a tracker but no way to gauge in advance of likely outcome - I'd not be one to go for all-out growth anyway as getting closer to retirement age.
The underlying funds in current ISA provider are all ITs, I think the management charges are on their underlying investments - Alliance Trust, Troy, Polar and Personal Assets.
Well if you're really into understanding how funds do, the UK fund managers are required to produce annual (I think) reports on how well their funds do. https://www.fca.org.uk/firms/extending-deadlines-publishing-fund-reports-and-accounts
Loads of articles in Sunday Times money section on this. They can be quite tricky to find as the poor performing ones hide them away behind logins etc.
eg random google search https://www.aberdeenstandard.com/docs?editionId=28ea1d7e-2e15-45b2-a0b7-63a8c8343de3
So you can see how well your funds do against their peers. Some companies eg St James Place have not only the worst performing funds but also the highest fees but justify it in the summaries by saying people choose them for their advice, not performance -- which is very funny as their advice appears to be invest in our very badly performing funds to minimise your retirement income.
If you're paying high fees, ok if the fund is beating all its peers, but if it's not, you're paying over the odds for sub-par performance.
Speak to Intelligent Money. They will help you figure out what your best choices are without being an IFA.
There range of investments perform well and their all in one charge is really competitive.
Citywide forums and Moneyvator are interesting reads, and I found the book Smarter Investing by Tim Hale quite useful.