I went to see the man at the pub
He had sold out of the Greece thing and advised me to forget the QROPS especially at 2500 quid:
We have completed extensive research into the different QROPS providers in the market and at the moment the biggest disadvantage we can see is set up and ongoing cost. The market is very similar to the SIPP market a decade ago, and we expect these costs to drop over the course of the next few years.
As there are no real significant advantage to a QROPS over a SIPP before you start to take benefits. Therefore, given the current increased costs of setting up a QROPS, a SIPP is in general a more viable option. The below table shows the typical cost of a SIPP Vs QROPS
Fees SIPP QROPS
Set Up Fee 295 995
Annual Fee 250 995
Benefit Fees SIPP QROPS
Calculation fee 145 0
Transfers out 250 0
Regular Income Payment 145 0
Annuity purchase 145 0
Death benefits 500 0
Overall the cost of the SIPP is far cheaper than a current QROPS. If over a 5 year period you can see how much this difference is.
1st 2nd 3rd 4th 5th Total
SIPP 545 250 250 250 250 1,545
QROP 1,990 995 995 995 995 5,970
This can add up on the smaller amounts and for the extra cost there is no actual added benefit.
Both the SIPP and the QROP can use an offshore investment bond as the platform for the investments so the cost of this is comparable. When you come to transfer the scheme from a SIPP to a QROP the investments do not need to be cashed in but are transferred as an inter specie transfer. This means the investment strategy does not need to be changed when the structure is changed. The cost of this would be £250.
Unless you are about to retire and take your pension then a SIPP would certainly be a better alternative than a QROPS at the current time. Until the costs come down to a reasonable comparison the option is very clear.
I was not that interested but was curious to know why such a big price difference. I am now better informed about the selling of this product.
Buyer beware it seems: http://www.telegraph.co.uk/finance/pers ... sions.html