Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • NorthernGeezer
    • By NorthernGeezer 13th Jan 18, 11:48 AM
    • 40Posts
    • 5Thanks
    NorthernGeezer
    Returns on a SIPP
    • #1
    • 13th Jan 18, 11:48 AM
    Returns on a SIPP 13th Jan 18 at 11:48 AM
    I've decided to transfer 3 pensions funds in to the Vantage SIPP run by Hargreaves Lansdown.
    Can any current users of this SIPP give me an idea of the returns/growth they are getting?
Page 1
    • Thrugelmir
    • By Thrugelmir 13th Jan 18, 12:04 PM
    • 56,767 Posts
    • 50,145 Thanks
    Thrugelmir
    • #2
    • 13th Jan 18, 12:04 PM
    • #2
    • 13th Jan 18, 12:04 PM
    You are sacrificing a guaranteed income to one that is at the behest of the markets. There's no guarantees as to the final outcome.
    “Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble”
    ― Warren Buffett
    • NorthernGeezer
    • By NorthernGeezer 13th Jan 18, 12:11 PM
    • 40 Posts
    • 5 Thanks
    NorthernGeezer
    • #3
    • 13th Jan 18, 12:11 PM
    • #3
    • 13th Jan 18, 12:11 PM
    Thrug
    I understand the pro's and con's of this decision.
    2 of these funds are closed funds with Phoenix so not making anything, the other is a workplace pension fund with L&G.
    I'm looking to consolidate all 3 in one place, if you've any other suggestions i would be interested to hear them
    • xylophone
    • By xylophone 13th Jan 18, 12:15 PM
    • 24,053 Posts
    • 14,064 Thanks
    xylophone
    • #4
    • 13th Jan 18, 12:15 PM
    • #4
    • 13th Jan 18, 12:15 PM
    You are sacrificing a guaranteed income
    I don't understand this comment.

    As I understand it, the OP is transferring 3 DC pensions into a SIPP - in effect, a SIPP is a DC pension?
    • xylophone
    • By xylophone 13th Jan 18, 12:21 PM
    • 24,053 Posts
    • 14,064 Thanks
    xylophone
    • #5
    • 13th Jan 18, 12:21 PM
    • #5
    • 13th Jan 18, 12:21 PM
    Can any current users of this SIPP give me an idea of the returns/growth they are getting?
    Returns (whoever provides the SIPP) depend on investments chosen.

    SIPP providers charge fees for their services.






    http://moneytothemasses.com/saving-for-your-future/pensions/the-best-cheapest-sipps-low-cost-diy-pensions
    • Thrugelmir
    • By Thrugelmir 13th Jan 18, 12:38 PM
    • 56,767 Posts
    • 50,145 Thanks
    Thrugelmir
    • #6
    • 13th Jan 18, 12:38 PM
    • #6
    • 13th Jan 18, 12:38 PM
    I don't understand this comment.
    Originally posted by xylophone
    Wasn't clear at the outset. In effect an investment question rather than a pension one. Given the further information provided.
    “Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble”
    ― Warren Buffett
    • xylophone
    • By xylophone 13th Jan 18, 12:58 PM
    • 24,053 Posts
    • 14,064 Thanks
    xylophone
    • #7
    • 13th Jan 18, 12:58 PM
    • #7
    • 13th Jan 18, 12:58 PM
    Wasn't clear at the outset.
    Earlier posts refer.
    • dunstonh
    • By dunstonh 13th Jan 18, 1:21 PM
    • 90,420 Posts
    • 57,209 Thanks
    dunstonh
    • #8
    • 13th Jan 18, 1:21 PM
    • #8
    • 13th Jan 18, 1:21 PM
    Can any current users of this SIPP give me an idea of the returns/growth they are getting?
    A SIPP does not grow at all. It is an administration platform that contains investments. It is the investments that are subject to investment returns.

    There are nearly 30,000 investment options on the London Stock Exchange (shares, ITs, ETFs etc). Then you have UT/OEICs and you can hold property in a SIPP and some SIPP providers give access to insured funds as well. - edit - must not forget all the other unregulated investments as well.

    As most SIPP investors use more advanced investment options and run a portfolio of multiple investments, you have a nearly infinite number of variations available.

    So, to answer your question, you are looking at a range of people who have suffered a total 100% loss to quadrupling in a year.
    Last edited by dunstonh; 13-01-2018 at 1:23 PM.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • NorthernGeezer
    • By NorthernGeezer 13th Jan 18, 1:22 PM
    • 40 Posts
    • 5 Thanks
    NorthernGeezer
    • #9
    • 13th Jan 18, 1:22 PM
    • #9
    • 13th Jan 18, 1:22 PM
    I understand that it depends on the choice of funds, but there must be someone out there in a similar position to myself who took out a HL SIPP in the last few years and can comment generally how it's performed.
    • TrustyOven
    • By TrustyOven 13th Jan 18, 1:33 PM
    • 676 Posts
    • 718 Thanks
    TrustyOven
    I understand that it depends on the choice of funds, but there must be someone out there in a similar position to myself who took out a HL SIPP in the last few years and can comment generally how it's performed.
    Originally posted by NorthernGeezer
    No. You are just not getting it.
    Please re-read dunstonh's post very carefully.
    Goals
    Save £12k in 2017 #016 (£4212.06 / £10k) (42.12%)
    Save £12k in 2016 #041 (£4558.28 / £6k) (75.97%)
    Save £12k in 2014 #192 (£4115.62 / £5k) (82.3%)
    • redux
    • By redux 13th Jan 18, 2:10 PM
    • 17,822 Posts
    • 22,933 Thanks
    redux
    I understand that it depends on the choice of funds, but there must be someone out there in a similar position to myself who took out a HL SIPP in the last few years and can comment generally how it's performed.
    Originally posted by NorthernGeezer
    It is just a wrapper, a holder.

    You choose what you put in the box.

    Any SIPP (the SI stands for self-invested) performance will depend on both your choices and the scheme charges.

    I can observe that HL's charging scheme is lower on shares than on funds. As I am interested in investment trusts (a type of share), this could be a candidate. Someone who wants to pick managed funds or index trackers and not pay much attention would pay slightly higher HL scheme charges than me. Whether HL is competitive on charges for this customer, I don't know.
    Last edited by redux; 13-01-2018 at 3:31 PM.
    • sandsy
    • By sandsy 13th Jan 18, 2:13 PM
    • 1,252 Posts
    • 735 Thanks
    sandsy
    Thrug
    I understand the pro's and con's of this decision.
    2 of these funds are closed funds with Phoenix so not making anything, the other is a workplace pension fund with L&G.
    I'm looking to consolidate all 3 in one place, if you've any other suggestions i would be interested to hear them
    Originally posted by NorthernGeezer
    These comments undermine your original question entirely. If you understand what you are doing, you will know that asking for other people’s returns is meaningless. Everyone has different returns, depending on how they’re invested.

    Further, closed funds doesn’t mean no returns. It simply means that no new investors can invest in those funds.
    • NorthernGeezer
    • By NorthernGeezer 13th Jan 18, 3:06 PM
    • 40 Posts
    • 5 Thanks
    NorthernGeezer
    It seems a SIPP may not be for me after all
    All i'm looking for is somewhere to put 3 pensions funds that allow me to draw an annual sum at retirement with some potential growth on the residual amount and that requires minimal input from myself.
    I've posted a lot on here in the last 2 weeks and still no clearer to where i'm going.
    Understanding financial services is a minefield and the 'common man' will continue to struggle i think, which is why IFA's exist i suppose
    • jamesperrett
    • By jamesperrett 13th Jan 18, 3:20 PM
    • 727 Posts
    • 379 Thanks
    jamesperrett
    It is probably worth reading the forum for a few months - I know it took me that long (or longer) to understand the possibilities with my pension. I went with HL as my SIPP is only a small proportion of my total pension and, despite their higher charges, I preferred their charging policies when taking my pension and the ease of use of their website. Other providers might be better for you but it is worth doing a comparison of charges for different scenarios - I used Snowman's spreadsheet but there are also websites that do the same thing.
    • xylophone
    • By xylophone 13th Jan 18, 3:47 PM
    • 24,053 Posts
    • 14,064 Thanks
    xylophone
    Let's try to get all the information in one place.

    You are in your 63rd year and anticipate receiving your SP (forecast £173 a week) at age 66.

    You are leaving paid employment at the end of this tax year for medical reasons.

    You have £60,000 with Phoenix and £10,000 with L&G which you wish to transfer to a scheme which will facilitate drawdown

    You also wish to make a contribution to this scheme from your savings in the current tax year while you still have relevant earnings.

    Let us suppose that you end up with £100,000 in the SIPP.

    You might choose to take the PCLS and use this as your income replacement for as long as possible, using the best available current/savings accounts.

    Remember that even with no relevant income, you can still contribute £2880 per annum (up to age 75) to the SIPP and the provider will claim £720 as tax relief.

    The balance of the money in the SIPP could be invested until such time as you wish to draw on it.

    You might prefer to use up the SIPP whilst deferring your state pension.

    You say that you have rejected the annuity option despite the fact that an enhanced annuity could be available.

    This may not be the wisest decision considering the nature of your medical condition which appears to indicate a reasonable life expectancy but possible neurological impairment?

    It really could be wise to consult an IFA?

    https://directory.moneyadviceservice.org.uk/en
    • NorthernGeezer
    • By NorthernGeezer 13th Jan 18, 5:04 PM
    • 40 Posts
    • 5 Thanks
    NorthernGeezer
    You've pretty much hit the nail on the head there xylophone and raised some good points for me to consider, thanks for your input.
    • OldMusicGuy
    • By OldMusicGuy 13th Jan 18, 5:13 PM
    • 263 Posts
    • 487 Thanks
    OldMusicGuy
    It seems a SIPP may not be for me after all
    All i'm looking for is somewhere to put 3 pensions funds that allow me to draw an annual sum at retirement with some potential growth on the residual amount and that requires minimal input from myself.
    Originally posted by NorthernGeezer
    So what you need is a SIPP then! I have a Hargreaves Lansdown SIPP and it's done averagely and then quite well, the reason being that I changed all the investments in the SIPP. You can do that yourself or pay an IFA to do it for you.

    If you are struggling to get to grips with all of this, I would suggest you do two things:

    - look at the Money Advice Service website, there's lots of good advice there on how pensions work (go to the "Retirement" section).

    - set up an appointment with Pension Wise (I assume you have not done this). It's free and they will explain all of this to you. They will not give advice on what you should do but they will help you understand all the options and how things like SIPPs and drawdown work.
    • NorthernGeezer
    • By NorthernGeezer 13th Jan 18, 5:28 PM
    • 40 Posts
    • 5 Thanks
    NorthernGeezer
    I've had my Pensionwise appointment OldMusicGuy and it didnt really tell me anything i didnt already know.
    I had kind of dismissed an annuity assuming drawdown would be the best option for what i want, the flexibility to take what i want when i want, but based on xylophones last post i'll look at what an enhanced annuity can offer.
    He/she also mentioned "you might prefer to use up the SIPP whilst deferring your state pension" which again seems like a good idea to consider.
    • atush
    • By atush 13th Jan 18, 10:20 PM
    • 16,460 Posts
    • 10,203 Thanks
    atush
    I understand that it depends on the choice of funds, but there must be someone out there in a similar position to myself who took out a HL SIPP in the last few years and can comment generally how it's performed.
    Originally posted by NorthernGeezer

    No, they cant Because the SIPP doesnt perform, but the investments do.

    And you can look up past performance of any investment online?
    • dunstonh
    • By dunstonh 14th Jan 18, 11:34 AM
    • 90,420 Posts
    • 57,209 Thanks
    dunstonh
    I've had my Pensionwise appointment OldMusicGuy and it didnt really tell me anything i didnt already know.
    Pensionwise is a generic information service. If that is what you want then they generally do a good job. However, most people want more than that. Plus, there are issues when you talk generic. It fails to take in commercial reality. So, they may say something that is generically correct but not correct when marketing pricing is taken into account.

    For example, you can now get lifetime annuities within a drawdown plan. Therefore giving you the security of a maximum guaranteed income but the ability to take it flexibly and reinvest what you do not want at the moment in time. Plus, it comes with death benefits better than the pre-2015 rules. It is a niche offering certainly but you wont get any mention of that at pensionwise as it doesnt fit any generic product type.

    He/she also mentioned "you might prefer to use up the SIPP whilst deferring your state pension" which again seems like a good idea to consider.
    Strange they said SIPP. Maybe it was a slip of the tongue. Very easy to do. A generic service should be sticking to generic product classes. You could use a stakeholder or a personal pension or a SIPP to do that. Statistically, SIPP is the least used option and classified as a higher risk option (given the scope to go wrong if you pick the wrong investments).
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

3,782Posts Today

9,756Users online

Martin's Twitter