iDeco One time yearly contribution.

[Ditto]

After months of going back and forth for the same reasons everyone has been talking about , I finally got the iDeco approved and ready to go.

During the initial applications I couldn’t choose a one time payment but the SBI agent on the other side of the line told me it’s something easily done once the iDeco is ready and running.

So today I got the account set up and immediately called to pay my whole yearly contribution. To my surprise I got informed that you can’t “preload” ( that’s how they call the process) in the beginning of the year but if you want, you can make a one time payment of 23,000yen X12 months =276,000yen. However this amount will be withdrawn from your account in December 2019, not January 2019

Advantage according to the nonsense SBI representative is that you will pay only 100 something yen transfer fee instead of 12, one for each month the money gets deducted from your bank account.

Disadvantage according to all no nonsense investor, you will MISS 12 months of being in the market.

The reason that the government allowed “one time payment” is not to give people the opportunity to be on the market for a longer period of time but to give the chance to them than didn’t have the means to pay the max contribution during the year to pay the remaining balance at the end of year.

Also starting shortly, the government has restricted all iDeco providers to max 35 funds. So SBI ( currently offering over 70 ) and all other providers offering more need to reduce the number of funds offered to the public. All the shareholders owning the funds will have to vote and based on the results SBI will choose which funds to keep and what to let go.

Please feel free to correct if I got anything wrong.

[adamu]

Also starting shortly, the government has restricted all iDeco providers to max 35 funds. So SBI ( currently offering over 70 ) and all other providers offering more need to reduce the number of funds offered to the public. All the shareholders owning the funds will have to vote and based on the results SBI will choose which funds to keep and what to let go.

I still didn't get around to setting up an iDeco, but things like this aren't encouraging. There are just too many strings...

I guess simplicity is good though, if the options are sensible.

[RetireJapan]

Yeah, in a way restricting funds sucks a bit, bit personally I only really care about half a dozen or so: the best passive fund in each major investment type...

As long as they keep the right ones it won't harm investors and might even make the lineup a bit easier to navigate

[jcc]

I had a look at the rakuten list, which is already under that limit https://dc.rakuten-sec.co.jp/service/product/

What I find surprising is the number of absurdly high-cost funds mixed in there.

I mean, they have adequate options for most sectors(e.g. most tawara no load funds), but then they have insane funds taking 1.5% management. I was under the impression that one purpose of ideco was that the government limit the choice of funds to keep funds with predatory fees out of the game. Does anyone know what happened?

[RetireJapan]

I think that is the case with the tsumitate iDeCo, not so much with the normal one...

[Dan]

Tsumitate iDeCo, nice one.

The funds on that page with the highest fees are actively managed funds. Not all of them though. Some of the passive funds also have high fees.

Great to see Rakuten offers its target date funds in iDeCo.