Drawdown providers

Linton

I am thinking of consolidating a number of pension pots and setting up a fixed drawdown in the next few months. I will be purely investing in funds and would like a wide range from different managers from which to chose but dont need the full facilities of a SIPP.

Any suggestions for an efficient but reasonably priced online supplier would be much appreciated.

jamesd

Value of the pension pot is a key consideration. The answer for £50,000 can be very different from the answer for £1,000,000 or £200,000. Also a factor is how frequently you expect to trade.

A place like Alliance Trust can be a good deal for low frequency trading at values of £100,000 or more. Yet with an annual fee of £135+VAT and trading charge for each buy and sell (both for a switch) of £12.50 the rebate of around 0.75% of fund AMC can prove a bad deal if you don't fit the good profile for its use. There's also a £50 charge to transfer in. £200 for first drawdown setup and £75 a year for drawdown, all subject to VAT.

BLB53

www.sippdeal.co.uk are worth a look - no transfer-in fees.

snowcat53

Bestinvest Select SIPP is also worth checking out
http://www.bestinvest.co.uk/sipps

Monevator also have good articles including this one comparing SIPP providers for holding of Vanguard funds
http://monevator.com/hargreaves-lansdown-vanguard-funds/.

mania112

Curious why the first 3 responses recommend a SIPP when the OP explicitly says that a SIPP is not required?!

Most 'big names' provide Drawdown contracts which have the same wide range of funds as their personal pensions.

Scottish Life and AXA Wealth are commonly used (by our firm), Scottish Life moreso for their governed portfolio range (which probably wouldnt suit you if you'd like to be your own 'manager' and select funds from classes yourself).

Both are reasonably priced. Both accept a minimum of £15k, although Drawdown itself is aimed at £100k+ as i'm sure you know.

Curious what you mean by Fixed Drawdown though. Drawdown isn't fixed, the income levels are reviewed every 3 years. The word 'fixed' is usually associated with Annuities.

Linton

mania112 wrote: »

Curious why the first 3 responses recommend a SIPP when the OP explicitly says that a SIPP is not required?!

Most 'big names' provide Drawdown contracts which have the same wide range of funds as their personal pensions.

Scottish Life and AXA Wealth are commonly used (by our firm), Scottish Life moreso for their governed portfolio range (which probably wouldnt suit you if you'd like to be your own 'manager' and select funds from classes yourself).

Both are reasonably priced. Both accept a minimum of £15k, although Drawdown itself is aimed at £100k+ as i'm sure you know.

Curious what you mean by Fixed Drawdown though. Drawdown isn't fixed, the income levels are reviewed every 3 years. The word 'fixed' is usually associated with Annuities.

Yes, the amount is more than £100K, though not a lot more. I should have said "capped", ie not flexible, rather than "fixed".

dunstonh

Most 'big names' provide Drawdown contracts which have the same wide range of funds as their personal pensions.

Scottish Life and AXA Wealth are commonly used (by our firm), Scottish Life moreso for their governed portfolio range (which probably wouldnt suit you if you'd like to be your own 'manager' and select funds from classes yourself).

I read that Scottish Life are the biggest provider of drawdown case in the country.

However, I suspect that the reason is that DIY providers will differ from IFA providers. An IFA wouldnt use a DIY provider as the IFA can get the contract cheaper from other providers. However, someone going DIY and not using an IFA will be looking to use the DIY providers.

snowcat53

mania112 wrote: »

Curious why the first 3 responses recommend a SIPP when the OP explicitly says that a SIPP is not required?!

Most 'big names' provide Drawdown contracts which have the same wide range of funds as their personal pensions.

Linton actually said he/she 'didn't need the full facilities of a SIPP' (not that a SIPP was not required) but even so a SIPP may be the best way of accessing drawdown for the private investor not going through an IFA.

I was in a similar position and the 'big names' I checked out were all very expensive for this compared to Sippdeal, HL and Bestinvest.( I went with Bestinvest after weighing up various factors).

jamesd

mania112 wrote: »

Curious why the first 3 responses recommend a SIPP when the OP explicitly says that a SIPP is not required?!

The post doesn't say that a SIPP is not required, rather, it says:

Linton wrote: »

I will be purely investing in funds and would like a wide range from different managers from which to chose but dont need the full facilities of a SIPP.

Not requiring the full facilities of a SIPP means to me not requiring things like buying commercial buildings with a mortgage in a SIPP. The funds only constraint may or may not mean solely funds, it might include investment trusts or ETFs, both of which are often not available within a standard pension, though they can be.

For online servicing, SIPPs are often a good choice because many of the lower priced ones target DIY investors with online servicing. It happens that the providers aiming for that market tend to use the SIPP approach. Not necessarily the best, just what tends to be readily available and well serviced online.

AXA Wealth tends to eliminate itself from consideration unless the amount to be invested is known, with the words "Our products are only available through Financial Advisers". The in turn implies costs that can make it an uneconomic choice for lower value pots. It's part of why I mentioned the importance of pot size in my post, since IFA-based pricing can make sense for uncommonly large pots.

For higher value pots, it'd be good to have a readily available to consumers cost, investment and servicing comparison data source that consumers can use to indicate whether it may be worth considering using an IFA to purchase a particular product. That's because I do not start out thinking "I want an IFA". I start with "I want a product for this, which is the best deal for me?" and that might or might not include going via an IFA. But it'll almost never start with "go to an IFA", for me or anyone I think is capable. The product comparison will come first, the IFA sales channel only if that seems specifically indicated as the way to go.

Personally, I trust that Linton will be able to sort out what is or isn't desirable, since I've found Linton to be a capable and well informed poster.