Pension fees - what's reasonable?

[Falcon1]

I'd really appreciate views from mumsnetters who know more about pensions than I do.

I'm currently paying 0.45% to Royal London to manage my pension fund, less their profit share, which is currently 0.18%. On top of that I'm paying 0.5% to my Financial Advisor for ongoing management (reviewing Royal London's portfolios, making sure they are performing in line with the market, assessing my risk profile and ensuring Royal London are investing in the correct portfolio for my current needs and circumstances). This currently all equates to 0.77% of total fees.

Does this sound like a good deal? I'm wondering if the Financial Advisor part is actually worth it. With compound interest, that 0.45% is going to be a lot of money over the next 25 years.

Any advice much appreciated!

golly. my pension is with royal London and I have to pay a 1% management fee. I don't have a financial advisor though, so don't have that fee. whether it's worth it depends on how big your pension is. 0.5% of bugger all really doesn't matter that much but 0.5% of £1,000,000 is very significant.

Thanks for the reply. I have nothing like 1,000,000! Although obviously the pot will continue to increase.

It seems high to me. Not sure you need a FA, I moved away from a set up like that years ago as the FA added, literally, FA.

I have a SIPP invested in Vanguard Life strategy.

It's fair charge if you want advice into retirement most advisers are 0.75 to 1% per annum

But what advice is being provided?

Vingoughsdog - not much advice to be honest. I get an annual statement with risk questionnaire but that's it. That's why I'm questioning the need for it.

Can you tell me about your SIP? What are the charges and how do you set it up?

sipps are often a rip off unless you have the skills of a financial investment wizzkid and the time and energy to apply them. the charges are higher than ordinary pensions because they have the flexibility for you to work investments in unusual ways. most people with a sipp are throwing their fees away because they don't manage their investments actively or take advantage of the flexibility, and just pick a spread of managed funds at the start and leave it at that, perhaps reviewing the fund balance once a year or so - and that is exactly what you can do for half the fee rate with a normal pension not a sipp.

None of that about SIPPS is true, do you actually know what one is?
What do you mean by "normal pension", that's an unhelpful term.
Can you explain the costs of a normal pension v a SIPP?

Anyway, I hold mine with YouInvest. They have a range of charges on their website. You need no skill at all. Just choose a fund and buy it in the SIPP.
You might want to consider their charges for drawdown too though.
I use Vanguard LifeStrategy. It's .45%, total expense ratio, though I read recently they are reducing that fee.

My SIPP itself currently costs £7.50 a quarter and has about £60k in it.

MoneyVator has good comparison tables on the site.

My Aviva pension is costing me 1%. I am looking to move it to a Vanguard SIPP which will cost me 0.15% platform plus 0.22% fund fee, so 0.37% total.

Why would I stay with Aviva?

Yes, the new Vanguard SIPP is really good value, I am looking to move to it!

SIPPs seem great value, but how much work is it? And how do you know what will make a good investment? I have no knowledge or time so wonder whether I might be better off keeping my current set up?

It's no work at all. Choose the provider, choose the investment, set up DD if you want to, then ignore it for years if you want.

I don't know how you know what is a good investment, how do you know what you currently have is a good investment?

I have no knowledge or time

Knowledge can be found if you want to. I wasn't born knowing how pensions work. I can't imagine thinking I didn't have time to commit to making sure my money was well organised.

Anyway, have a look at Vanguard, they are well recommended in all the financial press etc.

You can learn online these days. You don't need do the Diploma in Regulated Financial Planning (though I'm thinking about doing it for a change in career) but you can watch videos, listen to podcasts, read blogs.

Just a few to get you started:

The Money Panel (In her financial shoes podcast) - themoneypanel.co.uk/
Meaningful Money - www.meaningfulmoney.tv
Money to the Masses - www.moneytothemasses.com
The Escape Artist - theescapeartist.me/

Time ... there are times when you are able to listen to a podcast whilst doing other things. Commute to work, whilst cleaning the bathroom, sitting in the evening with a nice glass of , you can find time to learn new things if you are determined to do so.

Thank you all, especially for the pod cast links - that's a great idea. Will start researching.