SIPP, Hargreaves Lansdown and Funds

pension-newbie

Thanks Dunstonh

My plan is/was to get an initial investment advice and then maintain myself, taking further advice at key moments eg when I hit 55, 60, 65). That first advice was more for piece of mind to ensure my portfolio was broadly sensible (including my non SIPP defined benefits / State Pension(s) as I am not a specialist.

jem16

pension-newbie wrote: »

Thanks Dunstonh

My plan is/was to get an initial investment advice and then maintain myself, taking further advice at key moments eg when I hit 55, 60, 65).

Is there a particular reason for using the HL SIPP?

It seems a bit strange to pay an IFA for initial advice then pay HL for advice each year which you are not getting and then pay an IFA again every 5 years.

dunstonh

pension-newbie wrote: »

Thanks Dunstonh

My plan is/was to get an initial investment advice and then maintain myself, taking further advice at key moments eg when I hit 55, 60, 65). That first advice was more for piece of mind to ensure my portfolio was broadly sensible (including my non SIPP defined benefits / State Pension(s) as I am not a specialist.

As Jem says, you are paying HL 0.5% p.a. for not getting advice. If you used the IFA to set it up and didnt want ongoing advice unless you requested it then the HL arranged platform would be cheaper. Or you can let the IFA keep the 0.5% you are paying HL and use the IFA as a sounding board when you want without having to pay more every 5 years.

pension-newbie

the ifa's I talked to (prior to transfer of serps) were all talking about 3% transfer and 1.5% per year for management.

I think I am happy where I am (although not wedded to it), as although I am may not be in the best place, I am better than I was, and better than I could have been. if anyone wants to offer me an alternative package based on my details - I am happy for you to PM me

jem16

pension-newbie wrote: »

the ifa's I talked to (prior to transfer of serps) were all talking about 3% transfer

I can see the 3% as i believe you are talking about a pot of £50k - is that correct?

and 1.5% per year for management.

I think you may have misunderstood that. The 1.5% is the typical annual management charge on most funds - the IFA would receive 0.5% of that as trail commission. You are still going to be paying HL at least 1.5% amc and they simply keep the 0.5% trail commission without providing you with advice.

pension-newbie

yes serps pot £55K protected rights (I am 48) so 17 years to go to normal retirement

jem16

pension-newbie wrote: »

yes serps pot £55K protected rights (I am 48) so 17 years to go to normal retirement

Meant to ask - did you not ask an IFA to do the trasnfer on fee basis? It would probably have been cheaper than their 3% commission quotes.

Where was it before the transfer?

pension-newbie

jem16 it was wiith scottish widows.

the IFA I compared were one a friend used and one I found through unbiased.com. I didn't like one and the other was just way too pushy.

In the end I pooled advice with my manager (who had taken his own professional advice) as he was in exactly the same SERPS scheme for the same duration - in the end I felt the advisor was trying to charge me to reduce his risk not add any value to me (not criticizing just what he had to do wasn't IMHO helpful to me).

So now I am in HL - have looked at the cash returns (negligable) and decided to accelerate my investment. My target retirement income is £45K - I have £20K from previous DB fund, I have state pension £10K (wife and I) so am looking for £15k from pensions which will need around £300K pot. I have £55K in H&L and £10k a year going into (part) company funded pension.

My strategy is I have the core necessities of life covered with DB, (and although irrelevant I know that to be conversatively invested under serious corporate professional advisors). Therefore with 17 years to go to retirement I will look to place the SERPS & DC scheme money in medium to high risk to grow that with long enough to make higher return likely.

The advice I was looking to seek from IFA was around portfolio balancing within this structure. My instincts are technology, BRICS (but not china), and European equities. But my instinct may be off and this is important so I am willing to pay for advice on strategy and fund choice, but not to tell me what seemed obvious (and I accept the personal risk that this is not true).

I will look in the longer term to take advantage of the wider range of SIPP features, but will probably stick with funds for the first year while I learn the mechanisms and do more reading

(I can't help thinking I am either my own or an IFA's worst nightmare - but 5% in the first year seemed a big pill to swallow)

Thanks again for the debate - it is enormously intersting

jem16

pension-newbie wrote: »

So now I am in HL - have looked at the cash returns (negligable) and decided to accelerate my investment. My target retirement income is £45K - I have £20K from previous DB fund, I have state pension £10K (wife and I) so am looking for £15k from pensions which will need around £300K pot. I have £55K in H&L and £10k a year going into (part) company funded pension.

I notice you are pooling your wife's state pension into the target figures. Is the state pension your wife's only pension provision?

If so it might be worth considering increasing her own pension entitlement as it will reduce your tax liability.

pension-newbie

Thanks Jem

I do have to think about that I know. In addition to state pension she will get half my DB pension (10k) + 20 years teachers pension (don't know the estimate off the top of my head I will look at that).

Full on retirement planning is one of the things I would need to review later (eg 55). Just for now I am worrying about growing the pot. Is there anything structural I shuld be doing now - I am happy to spend money on IFA's to get advice although I will be honest we don't have much spare cash to increase her provision, but may have when the kids are (more!!)self sufficient.