SIPP, Hargreaves Lansdown and Funds

EdInvestor

Hi DH

Have you looked at the Sippdeal "Sippcentre" for IFA- managed pensions?

I've no idea how good it is from your point of view but AJ Bell/Sippdeal have a well deserved top rep for admin, they are excellent right across the range from very cheap to bespoke, with many years of experience.

You may be aware they run the admin side for Skandia's SIPP, among many others.

scouser_in_exile

Post Edited

whiteflag_3

EdInvestor wrote:

Hi DH

Have you looked at the Sippdeal "Sippcentre" for IFA- managed pensions?

I've no idea how good it is from your point of view but AJ Bell/Sippdeal have a well deserved top rep for admin, they are excellent right across the range from very cheap to bespoke, with many years of experience.

You may be aware they run the admin side for Skandia's SIPP, among many others.

Ed- So what exactly did you mean in post 106 when you said "

My last word on this topic. You guys are wasting everyone's time.

Cant help yourself can you:rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl:

JohnG

Whiteflag,

Must ask Just what is the point of your recent comments directed at Edinvestor on this thread? They don't contribute anything to the discussion or argument.

Rgds
John

whiteflag_3

JohnG wrote:

Whiteflag,

Must ask Just what is the point of your recent comments directed at Edinvestor on this thread? They don't contribute anything to the discussion or argument.

Rgds
John

Hi John

Can you be more specific? How recent?

Cheers

wF

dunstonh

In all cases, the funds offered by the insurance companies (for Pension funds) underperformed (slightly) the equivalent investments funds available direct from the fund manager (this is after taking all the normal charges into account).

Modern personal pensions have access to all those external funds as well as the internal. Whilst it is fair to say that most insurers are not that great on equities, they are quite good on the low risk end of the scale (such as fixed interest and property). So, you can build many portfolios within a modern personal pension and have the funds you mention as well as the better internal ones cheaper.

Does this not make a low cost SIPP better value than pensions offered by Insurance companies - and with a wider choice of funds?

Not comparing like for like. You are looking at a low cost SIPP against full cost personal pensions. If you purchased a low cost personal pension and compared that, then the PPP would have lower charges than the SIPP. It is also, even on commission to adviser, to have lower charges on the PPP compared with the SIPP. For example, you can have a portfolio of invesco perp, schroder, fidelity etc and some internal funds for a reduction in yield of around 0.7%p.a. and the adviser can still earn full commission. Check your reduction in yield out on the SIPP.

The issue the advisers have here isnt that SIPPs are bad. They are great when used correctly. However, they are not for everyone. Yet they get pushed here by some as the answer to everyone that posts whether they are suitable or not. You then find the advisers posting caution and possible alternatives and that is seen as being negative when it is only trying to balance things.

In JohnG's case, he went into a low cost SIPP and has ended up paying more charges than the personal pension his [ex] IFA would have set up. The fund chosen has underperformed the equivalent offered by the insurer his IFA recommended. The SIPP cant take the protected rights but the personal pension could have. So, with that in mind, was a full SIPP the right product for JohnG? I would say no. With the level of communication that has taken place here, if that had happened with his IFA, he could have easily been put into a fund supermarket pension/Hybrid SIPP and had the best of both worlds.

Paul_Varjak

dunstonh wrote:

Not comparing like for like. You are looking at a low cost SIPP against full cost personal pensions.

You are right of course, I am not comparing like for like. I suppose I could get a low cost personal pension and get initial charges rebated?

dunstonh wrote:

If you purchased a low cost personal pension and compared that, then the PPP would have lower charges than the SIPP. It is also, even on commission to adviser, to have lower charges on the PPP compared with the SIPP. For example, you can have a portfolio of invesco perp, schroder, fidelity etc and some internal funds for a reduction in yield of around 0.7%p.a. and the adviser can still earn full commission. Check your reduction in yield out on the SIPP.

When you talk of a "Reduction In Yield" does this only take account of the charges levied by the Insurance company? Or does it also include the charges presumably levied on the funds by the external fund managers to the insurance company?

dunstonh

You are right of course, I am not comparing like for like. I suppose I could get a low cost personal pension and get initial charges rebated?

Even on full commission, most modern personal pensions have no initial charges. The commission discount would be reflected in the lower annual manangement charge. That is far more beneficial if you have terms of 20 years or more.

When you talk of a "Reduction In Yield" does this only take account of the charges levied by the Insurance company? Or does it also include the charges presumably levied on the funds by the external fund managers to the insurance company?

Reduction in yield is all charges over the full term but again, most modern personal pension plans are mono charged have no charges on the wrapper. The only charge is on the funds.

Jake'sGran

dunstonh wrote:

Basically, they are a hybrid between a personal pension and a SIPP. The wrapper is an insured personal pension so can take protected rights and has personal pension discretionary trust status. However, you can invest in any of the funds available on the unit trust/ISA platform just as you would as an ISA. The charges are exactly the same as you would have them on the ISA/unit trust. There are no charges on the SIPP wrapper and no need to hold a cash account within the SIPP.

.

Hello Dunstonh, I have been reading the postings here mainly because my son-in-law has a SIPP with Hargreaves Lansdown but I have a query about your mention of "funds supermarket" in your first post. Is this Fidelity Funds Supermarket in which the discount on funds is not as generous as it is when purchased from Hargreaves Lansdown? Please ignore this if I have misunderstood.

In passing, I too would say that the HL site is rather messy to use but I buy funds through them because of the better discounts. I have yet to find a good site on which I can keep my portfolio details with individual purchase dates etc.

dunstonh

http://www.ft.com/cms/s/c92b7e42-8132-11db-864e-0000779e2340.html

article on DIY SIPPS. Just a warning to be careful for those thinking about doing it. Doesnt mean you shouldnt do it but it does reflect the comments that have been made on this thread by the advisers.

Hello Dunstonh, I have been reading the postings here mainly because my son-in-law has a SIPP with Hargreaves Lansdown but I have a query about your mention of "funds supermarket" in your first post. Is this Fidelity Funds Supermarket in which the discount on funds is not as generous as it is when purchased from Hargreaves Lansdown? Please ignore this if I have misunderstood.

No, not FNW. At the moment, I have the view that the only decent fund supermarket pension is the Selestia pension. Although I do know that two other product providers are coming with something that apparently allow unit trust funds to be used on a funds platform without the need to go down the full SIPP route.