Some online planning may profit funds in retirement purse
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IF you are considering taking out an AVC, make sure you opt for a product with low charges.
Otherwise, high charges will act as a drag on the performance of your AVC fund.
Many people opt for a PRSA (Personal Retirement Savings Plan) when taking out an AVC.
Although the charges for standard PRSAs are capped, they can still mount. Standard PRSAs have costs limited to 5pc on each contribution, and 1pc a year on the total value of the fund.
But you can do better.
Online brokers, who operate on an execution-only basis, will generally drop the 5pc charge on each contribution.
Be warned: execution-only means that you will not be given any advice, so you need to do your research.
One such broker is John Geraghty of LABrokers.ie. who will organise a PRSA with Irish Life, Eagle Star or Hibernian on what is known as a nil-commission basis. This means the only cost to you will be the 1pc annual management charge imposed on the total value of the fund.
Another option is PRSA.ie which has similar deals, while myadviser.ie will do nil-commission on lump sums AVCs.
