Consolidate pension pots in SIPP?

foofi22

Hi
I have the following "pots":
Zurich ~40k
Scottish Widows ~40k
Siemens ~12k

I've been wondering whether it is worth consolidating all of these into a single SIPP.

I believe a SIPP will provide more investment fund options than my ex-company schemes, however I predominately invest in cheap global trackers with some active funds for smaller companies, which should be easy to replicate. I suppose my primary concern is charges.

Taking my Zurich pot as an example, I was charged a total of £8 in December for charges. Each fund has a "fund-based charge" for they sell a portion of each fund monthly to cover the charge. I work this out to be an approx. 0.25% yearly charge (ignoring the individual fund fees) for my fund selection

Are SIPPs (in general) competitively priced? It seems so hard to compare!

Prism

You will need to get the exact charging structure for each of your pensions to help make that decision.

For example Scottish Widows has a group personal pension (company) charge of 1% as a standard baseline but individual companies pay different amounts which are often lower than that. In addition some of the (active) funds increase that amount too.

Check through your paperwork

dunstonh

I believe a SIPP will provide more investment fund options than my ex-company schemes, however I predominately invest in cheap global trackers with some active funds for smaller companies, which should be easy to replicate. I suppose my primary concern is charges.

Your primary concern should never be charges. It should be where and how it is invested. Charges are secondary to that.

Taking my Zurich pot as an example, I was charged a total of £8 in December for charges. Each fund has a "fund-based charge" for they sell a portion of each fund monthly to cover the charge. I work this out to be an approx. 0.25% yearly charge (ignoring the individual fund fees) for my fund selection

Are SIPPs (in general) competitively priced? It seems so hard to compare!

Generically, SIPPs are the most expensive option. However, modern plans with cheap investments can bring the costs down so they are close or comparable. The lowest cost stakeholder pension is around 0.45%. The lowest cost personal pensions are in 0.3x% range. SIPPs can come close to those if you look at the cheapest types.


Comparing mono charged plans is easy (annual charge only). Comparing multi-charge plans usually requires software or a good knowledge of spreadsheets.

foofi22

dunstonh wrote: »

Your primary concern should never be charges. It should be where and how it is invested. Charges are secondary to that.

OK fair enough, I did say primary after all. I'm happy with my fund choices - 100% equities consisting of global index trackers + some active smaller company and emerging market funds - and believe I'd be easily able to replicate this mix in a SIPP (hence why cost was my main concern, as it is pretty much the only other thing I can control. I don't want to end up paying more for essentially the same thing, although having them all in one place would be convenient)

dunstonh wrote: »

Generically, SIPPs are the most expensive option. However, modern plans with cheap investments can bring the costs down so they are close or comparable. The lowest cost stakeholder pension is around 0.45%. The lowest cost personal pensions are in 0.3x% range. SIPPs can come close to those if you look at the cheapest types.

I hadn't considered stakeholder or personal pensions. Although most pensions I find seem to be SIPPs! Any stakeholder ones I have seen seem to charge a flat rate 1% - guess I'm looking in the wrong place.

dunstonh wrote: »

Comparing mono charged plans is easy (annual charge only). Comparing multi-charge plans usually requires software or a good knowledge of spreadsheets.

Yes it does make comparison harder where one platform charges an annual charge and another fund-based charges. However I know what I invest in and what I would invest in so it should be fairly simple (but labour intensive)

dunstonh

I hadn't considered stakeholder or personal pensions. Although most pensions I find seem to be SIPPs!

SIPPs have lower regulatory requirements and lower consumer protection. This makes them cheaper to operate. The DIY market is very cost focused (well, some of it is. Some is far more expensive than advised stuff which defeats the purpose of DIY). So, the cost-focused providers typically went SIPP to keep their own costs down.

Any stakeholder ones I have seen seem to charge a flat rate 1% - guess I'm looking in the wrong place.

Yes, 1% was good in 2001. Its 2-3 times the cost in 2019.

If you are going to DIY, then its almost certain that you will be coming across SIPPs as the main thing.

Albermarle

I work this out to be an approx. 0.25% yearly charge (ignoring the individual fund fees) for my fund selection

As a platform charge this is competitive with SIPPS and cheaper than some .
You could consolidate the pensions into one of the existing ones rather than into a Sipp. Although if these are quite old pensions they might not offer drawdown facilities etc