Is It Worth Me Setting Up and Managing a SIPP?

janesmith

Alexland wrote: »

If you setup the Aviva stakeholder via Cavendish suggested above with a regular direct debit of £240 per month then the provider will claim the £60 government contribution automatically and invest £300 per month. The fees would be deducted automatically, there is no cash balance to worry about, and it uses the same MyAviva login details as their car, home or life insurance products.

https://www.cavendishonline.co.uk/pensions/stakeholder-and-personal-pensions/aviva/

https://www.aviva.co.uk/stakeholder-pension/

Then you can sit back, watch the direct debits leave your bank account, and login every 3 or 6 months to see how things are ticking over. The next time you need to give it attention is when you retire (or age 75 at the latest) when you would need to decide between taking an annuity for guaranteed income for life (shop around for the best rates) or transferring into a SIPP for income drawdown.

Alex.

That sounds like a clever, semi-automated solution. It's less hassle than doing everything manually when the net benefit I will probably get is only a few hundred quid for a whole year.

Thanks.

If anybody has got any other ideas please let me know.

Dox

I think you're overestimating the 'hassle' bit, simply because you've never done it before. If you really find it a headache, you could always call it a day after one contribution!

Thrugelmir

What investments are you aiming to own inside the pension "wrapper" ?

LHW99

If you are classed as a "non-earner" what is your NI situation? May be worth keeping an eye on, as it can be helpful paying some voluntary contributions to make sure you have at least a minimum qualifying amount for state pension.

BLB53

Is it worth all the hassle (and costs) of setting everything up and managing it every year for the relatively minor tax benefits I'll get for my annual £2,880 contributions?

It does not need to be very complex. I have a sipp with AJ Bell Youinvest which is now in flexi drawdown. I personally chose a simple investment - Vanguard Lifestrategy as it was more hassle managing a portfolio of shares but each to their own.

I pay a platform charge of 0.25%. I make one withdrawal each year and it operates just like a savings account.

I would never give up on collecting free money from hmrc, £720 x 20 = £14,400.