Which pension for holding cash?

chris1

Which providers / products would you suggest to look at for holding cash in a pension pot?

HL SIPP is one option (no charge for holding cash), but what others are there?

It’s for a transfer in cash from a DC occupational scheme which is being wound up and he wants to keep it in cash as only 3 years until needed for an annuity.

Thanks.

xylophone

http://www.moneysavingexpert.com/savings/cheap-sipps

Check out list here?

dunstonh

HL SIPP is one option (no charge for holding cash), but what others are there?

The platform charge should apply irrespective of investment used. Are you sure the platform charge doesnt come into it?

ffacoffipawb

dunstonh wrote: »

The platform charge should apply irrespective of investment used. Are you sure the platform charge doesnt come into it?

No, pretty sure the platform charge does not apply to cash, however the interest paid by HL in a SIPP on cash is appalling (so a backdoor platform charge perhaps).

chris1

ffacoffipawb wrote: »

No, pretty sure the platform charge does not apply to cash, however the interest paid by HL in a SIPP on cash is appalling (so a backdoor platform charge perhaps).

You are right.

dunstonh wrote: »

The platform charge should apply irrespective of investment used. Are you sure the platform charge doesnt come into it?

Is this unusual - are they the only ones that don't charge for cash?

zagfles

dunstonh wrote: »

The platform charge should apply irrespective of investment used. Are you sure the platform charge doesnt come into it?

Yes. HL, along with other platforms, also charge differently for shares than they do for funds (same % but capped at £200 for shares).

zagfles

ffacoffipawb wrote: »

No, pretty sure the platform charge does not apply to cash, however the interest paid by HL in a SIPP on cash is appalling (so a backdoor platform charge perhaps).

Yes, though have a look at standard savings account rates offered by high street banks! Not surprising with base rates at 0.5%. The higher rates are generally loss leaders with a low limit on the investment (eg current accounts, regular savers).

HL do sometimes have fixed rate offers (similar to fixed rate bonds where you tie the money up for a period), but seems they haven't got any at the moment.

kidmugsy

chris1 wrote: »

Which providers / products would you suggest to look at for holding cash in a pension pot?

HL SIPP is one option (no charge for holding cash), but what others are there?

It’s for a transfer in cash from a DC occupational scheme which is being wound up and he wants to keep it in cash as only 3 years until needed for an annuity.

In a perfect world, if holding it for an annuity he'd bung the money into a Gilt with a maturity date 15 or so years after the expected purchase date of the annuity. Even in this fallen world there are worse ideas, unless he positively wants to punt on an increase in interest rates. He may want to, of course.

chris1

The FSCS compensation limit will also be an issue - is there anyone other than HL who don't charge for holding cash?

ffacoffipawb

chris1 wrote: »

The FSCS compensation limit will also be an issue - is there anyone other than HL who don't charge for holding cash?

Secondly, he could add two personal pensions which are in cash funds - is there any advantage to leaving them in separate pots? (other than the FSCS issue).

Youinvest / SIPPDEAL don't charge for cash.


EDIT: Actually they charge a maximum of £25 per quarter if you just hold cash in a SIPP. So 0.1% p.a. on £100k so not too bad.

PosterBoy77

I was looking into this recently.

I found that http://www.investacc.co.uk/ seem to offer a good product with their SIPP Lite.

£195 per year fee and no other charges. You can choose any SIPP deposit account of your choice to get better interest too.