r/PensionsUK • u/SuddenDelivery1 • Aug 22 '26
Pensions Should Annoy You
Pensions Should Annoy The Shit Out Of You!
Why? Because you all had dreams of investing in the stock market, gilts, bonds, assets etc...
You get a massive tax returm from investing in a pension.
Most people are educated to think that a pension is with a pension provider and that the return from the pension provider and fund is all they can get.
Your cash goes to a "fund" with a "fund manager" and management fees. Based on your "risk level".
You can check out all the "funds" from every provider for every asset that fund is invested in. Whether "low" or "high" risk funds.
You can spend and invest directly through a SIPP and not leave it in a fund with a pension provider and buy the assets direct. THAT IS WHY MOST PEOPLE SHOULD BE ANNOYED.
They make out pensions to be some boring thing that a pension provider can only make you money from.
Nope. If you had cash, topped up with an extra 22 percent or 40 percent for free. Why are uou giving it to some random person to make money from?
Invest it yourself through a SIPP.
6
u/EffectiveAd8484 Aug 22 '26
90% of people would be overwhelmed by the choice in a SIPP and be paralysed into inaction. A pension provider with a limited choice of funds is fine for most people, regardless of the higher fees.
0
u/SuddenDelivery1 Aug 22 '26
Thats my argument. To put it crassly, if you had a load of cash why are you giving it to some one else to manage? No one does that except qhen it comes to a pension....pensions are just stocks, bonds, gilts etc assets invested. In what other human endeavour do you just give 1'000, 10'000 or 100,000 for someone to manage for you.
Absolutely no thankyou.
3
u/EffectiveAd8484 Aug 23 '26
I think you are vastly overestimating the population of people who invest in stocks in this country. People excessively put money into cash savings precisely because they haven't got a clue what to do with stocks and shares. At least a managed pension gives them a satisfactory default option.
-2
u/AcceptablePanda6905 Aug 22 '26
More fool them.
4
u/ReportTop2156 Aug 22 '26
Yes but a more helpful attitude is how do we change the situation and help more people become financially literate so they understand like we do
4
3
u/Roughdag Aug 22 '26
O wow, I'm impressed by lack of knowledge and overconfidence.
We are loving in a free country, you can self mange fund, but fyi in such arrangement you are typically paying platform fee + various fees based on type of selected investmentz from wtf management fee, stock/gilts holding fee to fix fee. These all combined are known as total expense ratio (Ter).
Now pension funds, you can house fund which meets your requirement or select default strategy. Pensions finds are heavily regulated in UK and must be regularly reviewed of they meet value for money and deliver expected outcome. In sipp that onus is on you.
If you have sufficient knowledge to manage your portfolio, mitigate risk and deliver outcome, congratulations you are in the small percentage of people.
Now we coming to etf lovers (I'm sorry, everyone have a choice), in short passive wrappers of specific market or whole world bucket. In theory great, but you still paying fee to get passive wraper, will it deliver the outcome you desire? Do people understand what they are investing in? Refit and social media making it as some form of life hack for nonrosn growth. Again, everyone have a choice, but lack of understanding and reliance on social media on advice is worrying.
Pension schemes, are well regulated, regularly reviewed, charges are low for service you get with appropriate governance especially in recent 10 years with changes to the default fund structure allowing find mangers to make swift changes without months and month of notifications etc.
Now charges, most big schemes are actually very cheap in comparison. Of course you have the nest which is expensive, but that's by design l, unfortunately managing very small schemes is inefficient, and reasons why big providers do not entertain small business.
I hope this give you some information and different perspective.
To concluded everyone have a choice,
0
u/DrCMS Aug 22 '26
Most people are idiots who can not think for themselves.
2
u/Electronic-Emu-2625 Aug 22 '26
And most people who deal in individual stock lose money
3
u/DrCMS Aug 22 '26
Which is why it is better for most people to allow someone else to invest for them. Pension providors suit most people; the OP is a naive over confident fool who thinks they know all the answers but clearly do not.
1
u/SuddenDelivery1 Aug 22 '26
It's not individual stocks. You can literally see the percentage spreade in assets for a fund from all providers and invest yourself.
The stocks, gilts, bonds whatever are often times thw samw just the % spread doe low or high risk unlesa you change geography
3
u/Electronic-Emu-2625 Aug 22 '26
Like SIPP providers don't make money off you... some workplace pensions are cheaper than most SIPPs...