Best SIPP for 70k pension pot.

2shy

Hello all,
I have several personal pensions dotted around several companies, acquired during my working life. I have phoned up the individual companies asking how much I am paying in fees per year, and have acquired transfer values for them.
Currently playing around 1% AMC in the different pensions.
Total transfer value around 70k.

I would like to transfer the lot to something a bit more manageable, so have done some reading here and over at monevator.com and am going to go down the route of a SIPP, probably putting it into a Vanguard LS fund, equity level to be decided.

I read, either here or over at monevator, that Hargreaves Lansdown would be cheapest for a SIPP account with only 1 or 2 funds and no trading.

Is this still the case?
I understand I would have an initial ~.24% dilution cost, and ongoing TER and a £2/month fund fee for Vanguard LS funds. Which is still less than the 1% I am paying currently.

Im a little confused about the FSCS cover affecting SIPPs, I understand that say HL or SIPPDEAL dont actually hold any of my money, but would I be better off splitting that amount across 2 different providers?

I would also be looking to transfer some SS ISA and CASH ISA's over at some point after April, with a value of around 25k, so dont want to put all my eggs in one basket.

Thanks in advance.

Edit:
Some personal stuff, Im 41, would likely put pension pot into 60% LS fund and lifestyle over to 40% by time I am 60.
ISAs have no immediate use for the money, I would balance between long term investment and short term 'just in case' money.

BLB53

Looks like you have done the research and I'm fairly sure HL would work out the cheapest for 1 or 2 Vanguard trackers - more than 2 and Sippdeal would be cheaper.

The other aspect is to check the fees of the potential candidates when it comes to taking benefits - annuity or income drawdown.

BLB53

Also this article may be useful regarding safety of money

http://www.moneyobserver.com/issue/features/your-do-it-yourself-pension-safe

grey_gym_sock

if i have the compensation rules correct, then in the unlikely event of HL or sippdeal misappropriating your investments, and then going bust so they couldn't compensate you, there's only £50k compensation per provider. so in theory, if you put £70k with 1 provider, you risk losing £20k.

however, if you split your £70k among HL and sippdeal, but still put it all in vanguard funds, then in the different, about equally unlikely, event of vanguard misappropriating your investments and then going bust, compensation would again be limited to £50k. so again, you could lose £20k.

personally, i would not split the £70k, because the risks appear very remote, and it would add noticeable costs. but i would then tend to put my ISAs with a different provider from my pension. and if i had a £700k pension pot, perhaps i would split it.

atush

that is what you should NOT do with your SIPP

This is a reference to a post which has been removed. Not the now new above post

Fabius

grey_gym_sock wrote: »

if i have the compensation rules correct, then in the unlikely event of HL or sippdeal misappropriating your investments, and then going bust so they couldn't compensate you, there's only £50k compensation per provider. so in theory, if you put £70k with 1 provider, you risk losing £20k.

however, if you split your £70k among HL and sippdeal, but still put it all in vanguard funds, then in the different, about equally unlikely, event of vanguard misappropriating your investments and then going bust, compensation would again be limited to £50k. so again, you could lose £20k.

The FSCS rules are very complicated. The above explanation is good, certainly the first paragraph is how I also understand it to be. And the important part is that it is the SIPP provider misappropriating the funds that causes you loss above £50k. They have to be stealing the money that you are giving them to put in the fund that you choose. If they simply go bust then your money with Vanguard is still with Vanguard, ringfenced from the SIPP provider and safe.

With the second paragraph however, Vanguard misappropriating (again they have to be actually stealing the money, not just going bust) funds, I think you'd get the lot because the SIPP provider makes the investment, not you as an individual and I'm not convinced that the £50k applies in the same way. I had an email from the FSCS about this because I had it queried before, I can't find it now though typically.

Either way, the chance of you losing anything is very remote and I wouldn't rank it highly given your TV of £70k plus whatever other bits you have. In that regard I'd agree with grey gym sock. The case I queried it for was over £1m going onto a platform (so understandably the client was keen to get the position correct!)