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Pensions - private/personal

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Hi all,


I am desperate to start paying into a pension. The company I work for are not due to enrol on the workplace pension scheme until 2017/2018.


When googling private pensions I don't seem to be spoilt for choice. e.g. Aviva and Virgin are the only obvious ones that come up.


Are private pensions risky? and why is there not much choice?


Any recommendations on this?

Comments

  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
    10,000 Posts Fifth Anniversary Name Dropper Photogenic
    Google SIPP
  • atush
    atush Posts: 18,731 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    HL, Cavendish online
  • zagfles
    zagfles Posts: 21,401 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Chutzpah Haggler
    edited 5 June 2016 at 9:56AM
    You can have a SIPP (self invested personal pension) and then you choose what it's invested in, so the risk depends on your investment choice. It's similar to a S&S ISA except it's a pension and so the tax treatment/access rules are different. But the underlying investments can be the same.

    SIPP provider's charges vary - google "snowmans spreadsheet" for a very useful comparison tool.

    Or a personal pension/stakeholder - these are often cheaper via intermediaries, eg an IFA, but then they'll want a fee too. Cavendish do an "execution only" service for a small fee, see http://www.cavendishonline.co.uk/pensions/stakeholder-and-personal-pensions/

    Check reviews too, including searching this board, some providers have had admin problems (both pension providers and SIPP platforms).

    If you want an IFA, search for a local one on http://www.unbiased.co.uk but shop around, their charges vary a lot.
  • dunstonh
    dunstonh Posts: 119,612 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Are private pensions risky? and why is there not much choice?

    There is no such product as a private pension. That is why you are finding low responses.

    It is a term that some people use to differentiate between workplace pensions and that collection of types used for individuals.

    For you, you would be looking at:
    Stakeholder pension
    Personal pension
    SIPP
    S&S ISA
    Any recommendations on this?

    That would be a regulated activity and the board isnt allowed to do that. Discussion is fine though.

    Generically, Stakeholders are the simplest option. Created in 2001 to be a basic, low cost option. it has a cap on charges with limited fund selections with full FSCS protection. Less chance to make a mess with one of these. However, since 2001, they have become less relevant as the other options have become cheaper and more flexible. Stakeholder pensions dont offer many of the new pension freedom options.

    Personal pensions are the middle ground. Can be cheaper than stakeholder pensions (using the same internal funds) or more expensive if you use external funds. Tend to offer all the modern options. Full FSCS protection

    SIPPs are, generically, the most expensive option. However, it is possible to get low cost if you select the right provider and the certain investments. Full whole of market investment options. It is really geared for the experienced investor. Limited FSCS protection.

    S&S ISA is not a pension but is frequently used in retirement planning. I include it as you may wish to run it alongside the workplace scheme or even transfer it into the workplace scheme (which would be a two step process).
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Our SIPPs are with Hargreaves Lamsdown ("HL"). We find their service excellent, and their charges are OK for modest sums (ours are both far below the £40-£50k mark where you might feel like transferring to someone else).

    We don't use them for ISAs, though; we think they are a bit expensive there.

    If you could be patient, you could wait for next tax year when LISAs will be available to the under-forties: until then there are regular saver accounts that pay 4% - 6% p.a.
    Free the dunston one next time too.
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