Cheapest Sipp: build yourself a low cost DIY pension article

Tiburonsmoke

Hi, I have a stupid private pension that I stopped paying into several years ago. It's not doing much at all. It's less than £10,000 but I'd ideally like to invest it in gold bullion, e.g., GoldMoney.com. I've contacted GoldMoney and they say that they are allowed in SIPPs portfolios. The trouble is, my dad's financial adviser has told me that even if gold does very well, the SIPP administration and buy fees would eat into my capital and wreck my returns, even with a cheap SIPP like Hargreave's Landsdown's Vantage. I'd be doing just the one trade, and putting it into one place, and leaving it there for, say, 3 or 4 years. Could anybody help me with some advice, please?

funkyronster

I don't agree with your dads ifa. The fees are quite low, assuming you are talking a reasonable amount, say more than 10 or 20k. You can either use Goldmoney, or consider Bullionvault, who are cheaper. You can have a BV account within a SIPP through EPML - google them.....but the costs are several hundred pounds a year.

Also consider a bullion ETF, which can be held in most free or low cost sipps - eg Bestinvest Select. But then you have to trust the ETF provider not to go bust. This depends on your general attitude. Personally I think that ETF's are quite safe, and that you will see any trouble coming well in advance, and act accordingly. Even Goldmoney and Bullionvault are not immune from government action if times get very hard.

Also - if you have funds available outside your SIPP, then you could consider a physical purchase of gold sovereigns - free of VAT, and also free of capital gains tax, which is not widely known. This could stand you in very good stead, nest egg wise, if gold really does shoot up in value as many folk think it will. But with physical bullion you have to store it somewhere and sleep soundly.

Good luck

dunstonh

The trouble is, my dad's financial adviser has told me that even if gold does very well, the SIPP administration and buy fees would eat into my capital and wreck my returns, even with a cheap SIPP like Hargreave's Landsdown's Vantage.

HL's SIPP isnt cheap.

as gold is not a commission paying asset, he would have to pay explicit charges for the SIPP.

Personally I think that ETF's are quite safe

Even with synthetic ones? Thats a bold statement for you to make considering the amount of concerns there are about certain ETFs at this time.

funkyronster

I didn't mean it to be bold....I did qualify it by saying that there should be plenty of writing on the wall should ETF's become unsafe. But in the meantime mainstream ETF's should provide as safe an exposure to gold as any other vehicle other than physical - at least as safe as other ETF's and mainstream financial instruments. One should always keep a track and monitor the situation.

Perhaps I should have said that exposure to gold in order of safety, would be physical, BV and GM, physically backed ETF's, generic ETF's, ETN's and synthetic products.

Of course nothing is completely safe in this present environment - other than physical gold in your possession, but perhaps that is off topic for this thread.

caelshorn

I recently read an article recommending a SIPP as a saving vehicle for your children, i.e. invest in a SIPP for them, and they won't blow it on their 18th birthday but have a solid start to a pension. Having just read the first few paragraphs of the article here, I realise I won't have the time to educate myself enough about this subject to make it a successful investment. Can anyone advise if it's still possible to open a pension on behalf of my daughter? Any recommendations? Many thanks!

Aegis

caelshorn wrote: »

I recently read an article recommending a SIPP as a saving vehicle for your children, i.e. invest in a SIPP for them, and they won't blow it on their 18th birthday but have a solid start to a pension. Having just read the first few paragraphs of the article here, I realise I won't have the time to educate myself enough about this subject to make it a successful investment. Can anyone advise if it's still possible to open a pension on behalf of my daughter? Any recommendations? Many thanks!

It's still possible to pay into a pension for a minor and receive tax relief on up to £2,880 paid in (grossing the contribution up to £3,600). However, if you're not already saving on their behalf you may wish to consider building up a pot of money for when they want to buy their first property or go to university, as missing out on these opportunities but having a good start on their retirement savings might not be the optimal balance.

dunstonh

I recently read an article recommending a SIPP as a saving vehicle for your children, i.e. invest in a SIPP for them, and they won't blow it on their 18th birthday but have a solid start to a pension. Having just read the first few paragraphs of the article here, I realise I won't have the time to educate myself enough about this subject to make it a successful investment. Can anyone advise if it's still possible to open a pension on behalf of my daughter? Any recommendations? Many thanks!

Most parents/grandparents use personal pensions or stakeholder pensions. Not SIPPs. Only those with large values on platforms who can get charges based on the total assets under management for family members are really suited to using SIPPs.

As for recommendations, no can do. That would be a breach of FSA rules and the FSA monitor this site (not that the fact they are monitoring the site is the reason for not breaking rules. There is good reason and that is because there is no one-size-fits-all best option).

Bogart99

Now I have a question also. Currently have about 60k earning basically 1.6% so need something better. Have used up this years cash ISAs for my self and my wife. I contribute to a company pension scheme and an AVC. Putting in about 17k to the AVC this year. My wife doesn't work so am wondering how to use up this 60k and thinking of putting some into a SIPP for her to even up slightly our pension pots. Was also thinking of doing share ISAs for both of us. I know its a bit of a gamble but can afford to lose some so not the end of the world.

dunstonh

Bogart99 wrote: »

Now I have a question also. Currently have about 60k earning basically 1.6% so need something better. Have used up this years cash ISAs for my self and my wife. I contribute to a company pension scheme and an AVC. Putting in about 17k to the AVC this year. My wife doesn't work so am wondering how to use up this 60k and thinking of putting some into a SIPP for her to even up slightly our pension pots. Was also thinking of doing share ISAs for both of us. I know its a bit of a gamble but can afford to lose some so not the end of the world.

You are better off asking on your own thread and not on an unrelated one.

However, when you repost your comment, you should add your questions as you left them off (you painted a brief picture but you didnt put the question in)

Bogart99

Okay thanks