Cheapest Sipp: build yourself a low cost DIY pension article

EdInvestor

c) go with a fund supermarket pension that does allow drawdown with PR and utilise unit trust funds (which is what most do anyway inside a SIPP).

The Selestia/Skandia option might look more interesting once the platforms are amalgamated, if the investor can have direct access. But if an IFA has to be involved, it's hard to see how it will help someone like shiredeon for instance, who will be wanting to organise his money online from France.

Are there any other 'fund supermarket pension' operators in the market (yet)?

dunstonh

The Selestia/Skandia option might look more interesting once the platforms are amalgamated, if the investor can have direct access. But if an IFA has to be involved, it's hard to see how it will help someone like shiredeon for instance, who will be wanting to organise his money online from France.

Most of these direct options are IFAs themselves but with online access.

If the IFA you deal with has online access (email for example) then you send the instruction to the IFA by email until such time that direct online access is available.

We arent just dealing with Shiredeon on this thread.

Are there any other 'fund supermarket pension' operators in the market (yet)?

Cofunds have linked up with Legal & General and I believe Fidelity have linked up with Standard Life. However, neither has gained the level of business/growth that Selestia has so I wouldnt be surprised to see them review their products. Had either of those come out with the Selestia product, they would have taken a lion share of the market.

EdInvestor

It strikes me that much of this market is currently operating in the execution only area and probably has no idea about the availability of the product because they don't go through advisors.

Perhaps the providers don't know about the existence of the potential market for the same reason?

:rolleyes:

dunstonh

Probably as the bulk of the market is still down the advice channel.

Plus, a number of the execution only SIPP providers have been operating in at a time when it was unregulated. Now that regulation is coming, some of them are closing their doors for business and others are revising their charges to reflect the increased costs of regulation.

At this time, only 6 providers have requested FSA authorisation to offer a SIPP post under regulation.

EdInvestor

What obsolete products are those?

I'm talking about compulsory annuities and zombie With profit funds. Many of the people with small protected rights funds will be caught in this trap.

None of these people will have advisors.

dunstonh

EdInvestor wrote:

I'm talking about compulsory annuities and zombie With profit funds. Many of the people with small protected rights funds will be caught in this trap.

None of these people will have advisors.

A lot of them wont because they wont go out and get one and they wont do execution only. They just sit there and hope for the best.

I get a lot of my business sorting out "naff" pensions and investments so some see the sense and get them reviewed. Anyone reading this thread who has a pension that started before 2001 and/or is investing into with profits should get their pension reviewed straight away as a priority. Pension funds and providers can be changed easily enough and a duff pension can soon become one with good potential.

misha

Hello,

Can anybody recommend a SIPP provider that would pay a reasonable interest rate (close to UK base rate) on cash deposit? Which provider pays highest rate on say, £20,000?

Thanks

cheerfulcat

Hello, misha,

Of all the reasons for choosing a particular SIPP, how much it pays on uninvested cash has to come absolutely last. Charges, and what investments you may hold, are far more important.

EdInvestor

Sippdeal is one of the better payers - currently 4.32%AER on 20k and no annual fee for the SIPP.

If you have a pension with protected rights money in it, the PR money has to be held in cash at present in a SIPP, there is no other option.

https://www.epml.co.uk is a SIPP provider offering a cash fund for PR money which claims to offer a good rate ( but no info on what it is).

The Newcastle BS promoted a cash SIPP a while ago, but IIRC the charges negated the higher interest rate.

Watch out for providers who offer tiered rates, where you don't get the highest rate on all your money.

shoi

whambamboo wrote: »

oh and another thing, HL's sipp doesn't appear to be cheapest at all, unless you want to buy commission-paying funds. The annual fee is 0.5875% on *all* shares for instance.
So if you want to buy shares then HL is going to charge you 0.5875% PA on top of its dealing costs.
Sippdeal or Alliance Trust Select Sipp don't have annual charges like this.

H-L do cap their fee at £235 so it's not that bad