howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
#1
bit of an eye opener for people who think they are getting a good pension deal.
http://www.guardian.co.uk/business/2011/dec/17/treasury-warned-over-traders-feesBrian Dixon
- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
#2
devious little bankers,should have there testies chopped as soon as.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
#3
that's what i thought about the traders, not a good representation of the city of london.
Guest 671- Registered: 4 May 2008
- Posts: 2,095
#4
I have just recieved a letter from MPS, informing me that my pension will not increase for at least 3 years.
"My New Year's Resolution, is to try and emulate Marek's level of chilled out, thoughtfulness and humour towards other forumites and not lose my decorum"
Guest 716- Registered: 9 Jun 2011
- Posts: 4,010
#5
Who has just veto`d the treaty to protect the City of London? and to keep the Conservative Party together?
Guest 696- Registered: 31 Mar 2010
- Posts: 8,115
#6
Reg, if the EU had started taxing the City, the money would not have gone towards British pensions, but to crisis-stricken Europe.
Brian Dixon- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
#7
alex,such nonsence.it is a differant kind of taxation .more so for profits on buying/selling stock/shares andother dirty deals.
Keith Sansum1
- Location: london
- Registered: 25 Aug 2010
- Posts: 23,948
#8
blimey o riley
how do they get away with it
ALL POSTS ARE MY OWN PERSONAL VIEWS
Alec Sheldon
- Location: Dover
- Registered: 18 Aug 2008
- Posts: 1,037
#9
GaryC, I received a letter last week saying my O.A.Pension is being REDUCED by £8 per week due to a clerical error made 12 years ago.( See my thread, Reduction in Pension)
I presume MPS means Miners Pension Service ?. My Merchant Navy Pension never increases as it was earned before 1988.
Keith Sansum1- Location: london
- Registered: 25 Aug 2010
- Posts: 23,948
#10
thats ununsual alec not increasing
ALL POSTS ARE MY OWN PERSONAL VIEWS
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#11
Many older pensions do not include increases Keith.
The 1995 Act brought in a minimum Limited Price Indexation of 5% or RPI if lower for company schemes. The last government changed that to 2.5% for some benefits, something that has not received much publicity.
That, of course applies to company pensions. Those of us, the majority, who do not have occupational schemes are less well catered for. If you use your pensions fund to buy a traditional annuity then you make a once only decision as to whether to have a level or increasing pension. That's not an easy choice - a level pension is a lot higher to start with and it takes about 8 years for a 3% increasing pension to match it and many years more before you get back the same amount of money.
Anyway back to the subject of charges and the subject of the thread.
This is nothing new and there has been a lot of controversy around pension charges but all is not necessarily as clear-cut as journalists like to suggest.
There was an appalling situation once, before 1994, when you would lose all of the contributions paid in the first 2 years to charges on a pension with 25 or more years to run. On top of that there would be ongoing charges as well. That ended in 1994 when the PIA assumed regulatory control from LAUTRO and FIMBRA and got to grips with things like commissions and training. Charges reduced steadily after that but that has not necessarily all been good news.
These days you can get a very low-charged pension, a Stakeholder has a simple maximum of 1.5% annual management charge reducing to 1% after 10 years when the fund is a lot higher. If purchased via a fee based adviser the charges can be as low as 0.5% per annum from the start.
This is not all about charges though. Take my own pension.
I could very easily set myself up with a stakeholder scheme with a 0.5% AMC using passive investments. Alternatively because of the size of my fund I could have a SIPP using ETFs which could track various indices and, because I know what I am doing, I could use 'active asset allocation' alongside ETFs to look after it. All of that could be a cheap as using a Stakeholder Pension - but I am not doing that either... Instead I do have my SIPP but I use retail funds in an asset allocated portfolio with a selected portfolio of 21 funds run by the top active manager in each sector. The charges for that are about 1.3% AMC, more than double what I would pay with passives. The whole point is that this portfolio will get the better performance and the charges are worth that. You get what you pay for.
That said out of maybe 14,000 funds there are only about 200 I would recommend... So there are a lot of expensive funds out there that are simply not worth what you pay for.
Do not get me wrong, sometimes cheap is good - pensions with a low fund level for instance, charges can be a huge drag on them so a cheap tracker can be the right approach.
It is all about horses for courses.
Keith Sansum1- Location: london
- Registered: 25 Aug 2010
- Posts: 23,948
#12
barryw
i think we allhope we get it right on pensions
but not everyone is able to do the same and have to put up with what they get(if they get it)
ALL POSTS ARE MY OWN PERSONAL VIEWS
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#13
That is the point Keith - far too people have pensions at all. In part that is an ill-effect of the lower charged pensions because the costs of advice is minimal so commission based advisers do not market them as they used to. The balance has gone too far. The new NEST scheme is very poor as well, pity the government is pursuing that.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
#14
thanks for info barry, have to admit that a lot of it went over my head.
the thing that stood out was there are 14,000 funds - a minefield for the unwary surely?
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#15
Yes indeed it is Howard.