Retirement is one of life’s biggest milestones. For most people, an Approved Retirement Fund (ARF) will become the primary financial engine that supports your lifestyle, paying you an income for the next 20 – 30 years.
Choosing an ARF advisor and setting up your ARF requires careful consideration of investment options, mandatory withdrawals, and Sequence of Returns Risk.
Here at One Quote Financial Brokers, we build our real value ARF advice around 3 Pillars:
- Total Transparency: Full disclosure of all costs (AMC, TER, RIY, and support fees) upfront.
- Bespoke Construction: Institutional-grade portfolios matched to your goals.
- Lifelong Support: Continuous management of rebalancing, sequence risk, and Revenue compliance.
The Compounding Effect of Charges
Investment returns and inflation are outside your control, but ARF charges do not.
The impact of charges is about much more than the amount deducted from your ARF each year.
When charges are deducted, that money is no longer invested. This means you lose not only the money paid in charges, but also the potential investment returns that money could have generated in the future.
Over a 20- or 30-year retirement, this cumulative effect can become significant. Higher charges can therefore create a drag on cumulative investment returns, potentially leaving substantially less capital available to provide your retirement income over time.
Consider two ARFs with the same investment performance before charges.
If one has a higher annual charge, the difference is not simply the amount paid away each year. The difference compounds over time because the money paid in additional charges is no longer available to generate future returns.
For example, a 0.40% difference in annual charges on a €1 million ARF is €4,000 in the first year alone.
If that €4,000 could otherwise have remained invested, it could potentially have generated further returns in subsequent years. Those additional returns could themselves have generated further returns.
This is the compounding drag of higher charges.
Over a long retirement, even seemingly modest differences in annual charges can therefore have a material effect on the cumulative value of your ARF.
At One Quote, we believe this is why cost should be considered alongside investment performance, risk and retirement income planning — not as an afterthought.
Our aim is simple: transparent charging, competitive costs and clear visibility over what you are paying for your retirement investment.
Going Beyond the AMC
Is the AMC the full Cost?
The Annual Management Charge (AMC) is the headline annual charge shown on most ARF charging comparisons because it provides a quick comparison between providers.
The AMC includes both the Fund Manager Charge and the Broker Support Charge; however, it doesn’t tell the whole story.
The Total Expense Ratio (TER) gives a more complete picture of the annual cost of investing.
In addition to the AMC, it includes certain operational expenses incurred by the investment fund, such as administration, custody, legal and audit costs.
These additional costs are often relatively small, but they are still deducted from your investment returns. Transparency means understanding the total cost of investing.
To evaluate your pension costs effectively, look beyond the basic Annual Management Charge (AMC) and review the Total Expense Ratio (TER)—which accounts for underlying operational costs—and the Reduction in Yield (RIY), which reveals the true impact of combined fees on your total returns.
One Quote Upfront ARF Charges
At One Quote, our charging structure is designed so that larger ARF investments can benefit from lower ongoing charges.
When you know your ARF investment amount you can clearly see the typical AMC to expect, we always present three investment porfolios aligned to your risk and ESG prefences, which will them include the nominal addiitonal investment expenses (AIE) so you get a full and clear comparison on the TER.
As the size of the ARF increases, the fund management charge (FMC) can reduce. For larger portfolios, our One Quote support charge also reduces.
ARFs from €250,000 to €500,000
Maximum FMC: 0.75% p.a.
One Quote Support Charge: 0.25% p.a.
Maximum AMC: 1.00% p.a.
ARFs over €500,000
Typical FMC: from 0.60% p.a.
One Quote Support Charge: 0.25% p.a.
Typical AMC: from 0.85% p.a.
ARFs over €750,000
Typical FMC: from 0.50% p.a.
One Quote Support Charge: 0.25% p.a.
Typical AMC: from 0.75% p.a.
ARFs over €2 million
Typical FMC: from 0.40% p.a.
One Quote Support Charge: 0.20% p.a.
Typical AMC: from 0.60% p.a.
Common Pitfalls: What to Avoid When Setting Up Your ARF
When choosing or reviewing an ARF, some retirees may make critical, costly mistakes that jeopardise their financial security. Avoid these five major pitfalls:
- Chasing Short-Term Performance: Selecting funds based entirely on recent returns rather than long-term stability and risk management.
- Focusing Solely on Headline Charges: Looking only at the base AMC while ignoring the total performance drag caused operational costs and your true Reduction in Yield (RIY).
- Ignoring Sequence of Returns Risk: Failing to insulate your cash flow, which forces your platform to sell equities at the bottom of a market cycle during mandatory distributions.
- Mismanaging Mandatory Withdrawals: Not planning for the strict 4% to 5% Revenue imputed distributions, which can unintentionally accelerate the depletion of your capital.
- Adopting a “Set-and-Forget” Approach: Leaving your portfolio completely unmonitored and unreviewed for years, allowing market drift to distort your intended risk profile.
The Role of Self-Directed ARFs
Some investors choose a self-directed ARF to allow investment in assets such as:
- individual shares
- ETFs
- bonds
- other investment assets
- select funds
For some very experienced investors with very large retirement funds, self-directed ARFs can offer greater flexibility, but they tend to be more expensive and often require significantly greater responsibility.
Where advisory or discretionary investment management is used, additional management and dealing costs can further increase the overall cost of the arrangement.
For most retirees, a professionally managed fund-based ARF supported by ongoing financial advice remains the more appropriate solution.
Securing Ongoing Advice
Why our typical 0.25% p.a. Support Charge is an Investment in Your Peace of Mind
Our competitive 0.25% annual support charge is not an arbitrary cost—it directly funds the proactive, ongoing management required to keep your retirement secure.
Leaving your entire life savings on an unadvised, automated platform leaves your wealth dangerously vulnerable to Sequence of Returns Risk.
Because mandatory withdrawals must be made from the ARF, careful management of how those withdrawals are funded is important. Without an appropriate strategy, withdrawals may require the sale of growth assets during periods of market weakness. This can crystallise losses and reduce the capital available to benefit from future market recovery.
Because the Irish Revenue enforces a strict, mandatory annual withdrawal of 4% to 5%, an unmanaged platform will blindly sell off your growth assets during market downturns just to meet those distributions. This forces you to lock in losses, permanently damaging your fund’s longevity.
Partnering with One Quote helps protect your income through strategic annual rebalancing, active sequence risk management, and Revenue compliance.
The One Quote Difference
- Total Transparency: Full disclosure of all costs (AMC, TER, RIY, and support fees) upfront.
- Bespoke Construction: Institutional-grade portfolios matched to your goals.
- Lifelong Support: Continuous management of rebalancing, sequence risk, and Revenue compliance.
Avoid common pitfalls like chasing short-term performance, ignoring hidden fees, and leaving portfolios unreviewed.
Speak to an ARF Specialist Today
Get in touch directly with our lead retirement expert to discuss your options:
- Lead Advisor: Ken O’Gorman (Retirement Specialist – CB, QFA, RPA, SIA)
- Firm: One Quote Financial Brokers
- Direct Telephone: 01 845 0049
- ✉️ Direct Email: ken@onequote.ie
