I've currently got all my pension pots invested in Scottish Widows, and want to check how sensible that is.
Looking at it from 2 viewpoints - firstly diversifying (to spread risk of Scottish Widows going bust) and secondly based on performance.
Any suggestions as to how I can compare Scottish Widows performance with rival companies? Useful internet sites etc.?
I'm thinking about comparing their various funds with rivals.
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Comparing performance of pension companies?
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- Lemon Quarter
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Re: Comparing performance of pension companies?
Try Monevator website for Insurance Companies Pensions information and comparisons
You might get your eyes opened-tend to be expensive and poor performers
xxd09
You might get your eyes opened-tend to be expensive and poor performers
xxd09
Re: Comparing performance of pension companies?
You should look into both the performance of the funds and the charges that are being incurred. There will be both fund charges (listed as AMC or TER percentages) and platform or administration charges. If you got the pensions through an employer, there may be a discount on the fund annual management charges (if you left them in the employer default fund most likely). Find out exactly which funds you are in with Scottish Widows - look for the ISIN codes which are strings of numbers and digits probably starting in GB.
Then go onto one of the fund data sites like FT or Morningstar where you can look up your funds by the ISIN code and compare to other funds. There may be different classes of the funds so watch out for that. You can then compare your funds with some other funds you are interested in. Be aware that you could hold the funds from various fund managers like L&G, Vanguard, BlackRock/iShares on different platforms like Hargreaves etc (the platforms listed on Monevator). I would pay close attention to charges if you are going to be invested for a long time as this can make a big difference to your returns - there will be plenty of info on this on Monevator and other sites. Also look closely into the holdings of the funds you have and asset allocation between shares and bonds.
For example, I am looking to switch out of some funds I have with my employers previous pension provider currently charging me 1% AMC which is quite high. So I went on the FT funds compare site (can't include link sorry) and compared them to Vanguard LifeStrategy funds and it showed they had similar asset allocation and historical performance but the charges would be lower with Vanguard.
You will typically find that companies like Scottish Widows, Standard Life etc have there own funds which are complete mash-ups with funds of funds possibly holding undesirable things like difficult to get out of property and GARs funds and opaque charging structures. You might want to look closely into what these funds are invested in and put into something simpler like Vanguard or BlackRock/iShares index funds, active funds or ETFs - depending on your investing style and preferences. You will find platforms like Hargreaves, AJBell etc have different charging structures depending on what type of investments you hold (funds, ITs, ETFs, shares etc). For example, Hargreaves charges 0.45% on funds uncapped but it is capped at £200pa on ETFs, ITs and shares.
Then go onto one of the fund data sites like FT or Morningstar where you can look up your funds by the ISIN code and compare to other funds. There may be different classes of the funds so watch out for that. You can then compare your funds with some other funds you are interested in. Be aware that you could hold the funds from various fund managers like L&G, Vanguard, BlackRock/iShares on different platforms like Hargreaves etc (the platforms listed on Monevator). I would pay close attention to charges if you are going to be invested for a long time as this can make a big difference to your returns - there will be plenty of info on this on Monevator and other sites. Also look closely into the holdings of the funds you have and asset allocation between shares and bonds.
For example, I am looking to switch out of some funds I have with my employers previous pension provider currently charging me 1% AMC which is quite high. So I went on the FT funds compare site (can't include link sorry) and compared them to Vanguard LifeStrategy funds and it showed they had similar asset allocation and historical performance but the charges would be lower with Vanguard.
You will typically find that companies like Scottish Widows, Standard Life etc have there own funds which are complete mash-ups with funds of funds possibly holding undesirable things like difficult to get out of property and GARs funds and opaque charging structures. You might want to look closely into what these funds are invested in and put into something simpler like Vanguard or BlackRock/iShares index funds, active funds or ETFs - depending on your investing style and preferences. You will find platforms like Hargreaves, AJBell etc have different charging structures depending on what type of investments you hold (funds, ITs, ETFs, shares etc). For example, Hargreaves charges 0.45% on funds uncapped but it is capped at £200pa on ETFs, ITs and shares.
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- Lemon Quarter
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Re: Comparing performance of pension companies?
b0f77 wrote:You will typically find that companies like Scottish Widows, Standard Life etc have there own funds which are complete mash-ups with funds of funds possibly holding undesirable things like difficult to get out of property and GARs funds and opaque charging structures.
I just thought that I should leap in and point out that (ignoring the argument about charges) this could be described as holding divers assetts that are not highly correlated. Modern portfolio theory argues that to actually be a good idea.
My work pension is with Aviva, but not a "default" choice of funds. When we moved pension providers the firm employed IFA's from a wealth management firm. Most people did wind up with magnolia selections, because that's what they wanted. I came away with a more racy choice, including 4% in property and made full use of the FA. While I can not comment upon other firms, mine arranged pension reviews for those who wished, which unlike many of my collogues, I took advantage of.
If you are intending to hold for decades and to gradually disinvest eventually, liquidity may be less important than performance, security and correlation of the assets.
FWIW my "racy" selection (which lost money for the first time last year) is
46% International tracker
40% UK tracker
10% Pacific rim tracker
4% property
BUT notably nothing like bonds. That "lack" increases my risks according to portfolio theory (CAPM).
I'm not a huge fan of Scottish Widows, but I do recommend significant research and thinking before doing anything. If you want to take on more risk and possibly increase returns or chose the converse, it's quite likely that you could do so with the current provider. Have you enquired?
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- Lemon Quarter
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Re: Comparing performance of pension companies?
Thanks for all suggestions.
I've had a look at the Monevator website, but am struggling to find a part of it that compares various Pension providers and performance.
I got the exact reference codes of the funds from my pension provider (which actually is Halifax Financial Services, not Scottish Widows by the way).
The management charge by Halifax for all my funds with them is 0.9% - so my next step is to find out whether this is higher than average, or whether I can get a pension managed with a flat annual fee, which will probably be best for me. I'd appreciate any views on how to find out about various pension providers' charges. I know this should be fairly simple, but I haven't found a good website source for this as yet. The information is probably somewhere on the LemonFool!
My pension asset allocation is
27% Gilts/Fixed Interest
45% International Growth (just over 50% invested in USA)
28% UK FTSE 100 tracker.
(Interestingly, when comparing performance of these 3 funds to benchmarks using Trustnet, the Gilts & International funds are similar to benchmarks, but the FTSE 100 performance is significantly worse than the benchmark, which seems odd, as I'd expect all trackers to have very close performance by their nature. Just glad I've only just moved funds into the FTSE 100 from the International fund!)
I've had a look at the Monevator website, but am struggling to find a part of it that compares various Pension providers and performance.
I got the exact reference codes of the funds from my pension provider (which actually is Halifax Financial Services, not Scottish Widows by the way).
The management charge by Halifax for all my funds with them is 0.9% - so my next step is to find out whether this is higher than average, or whether I can get a pension managed with a flat annual fee, which will probably be best for me. I'd appreciate any views on how to find out about various pension providers' charges. I know this should be fairly simple, but I haven't found a good website source for this as yet. The information is probably somewhere on the LemonFool!
My pension asset allocation is
27% Gilts/Fixed Interest
45% International Growth (just over 50% invested in USA)
28% UK FTSE 100 tracker.
(Interestingly, when comparing performance of these 3 funds to benchmarks using Trustnet, the Gilts & International funds are similar to benchmarks, but the FTSE 100 performance is significantly worse than the benchmark, which seems odd, as I'd expect all trackers to have very close performance by their nature. Just glad I've only just moved funds into the FTSE 100 from the International fund!)
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- Lemon Quarter
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Re: Comparing performance of pension companies?
zico wrote:I've had a look at the Monevator website, but am struggling to find a part of it that compares various Pension providers and performance.
I'm not aware of a source that compares all Pension providers. As you have found out there are sites that compare investment funds/trusts that people invest to provide a pension. MoneyObserver produces a table once a year that compares SIPP providers. It is fair to say that what is best for one person is less good than a alternative for someone else.
I'm sorry, I'm struggling to find a link to the Money Observer article..
My SIPP is with YouInvest and here are their charges.
https://www.youinvest.co.uk/sipp/charges-and-rates
As you can see the cost structure is quite complicated, but could work out cheaper for you, until you retire. They do a calculator, but I suspect that it's simplistic.
https://www.youinvest.co.uk/charges-and ... lsrc=aw.ds
Note the charges when you start to draw your pension (I doubt that the calculator factors them in).
Compare them with HL's charges.
https://www.hl.co.uk/pensions/sipp/char ... rest-rates
But NOTE the charges when you start to draw your pension are less.
https://www.hl.co.uk/pensions/drawdown/ ... nt-charges
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