Move ReAssure pensons to SIPP?

JoeEngland

Of all my DC pensions those in ReAssure have the highest charges. These were private pensions and AVCs. I recently turned 53 and was wondering whether I should open a SIPP and move my Reassure pots to that now. However, looking at the HL SIPP it seems the charges are 0.45%pa plus fund charges. With those two charges I could end up paying as much as I do now. Would it be better to wait until I'm 55 to open a SIPP and transfer the DC pots to it then so I can begin to drawdown (none of my existing DC pensions allow drawdown)? Also, would I be better to look at other SIPP providers than HL?

billy2shots

I swapped a Reassure stakeholder pension to a Fidelity SiPP 13 months ago.

Reassure costs were 1% per year and I felt I had very little control over it.

Swapped it to Fidelity who do all the leg work and paid me a swapping bonus.

Fidelity do charge a platform fee of 0.35% plus your choice of funds on going charge. However I swapped into ETFs and ITs which cancel the 0.35% charge and replace it with £45 a year charge. ETFs and ITs are charged a trading fee of £10 to buy or sell or £2.50 (I think) for regular monthly purchases.

All the above factored in has me paying 0.36% a year compared to 1%.

SonOf

However, looking at the HL SIPP it seems the charges are 0.45%pa plus fund charges. With those two charges I could end up paying as much as I do now.

Quite possible. Indeed, you could end up paying a lot more. There are an awful lot of people paying over 2% a year with HL.

Would it be better to wait until I'm 55 to open a SIPP and transfer the DC pots to it then so I can begin to drawdown (none of my existing DC pensions allow drawdown)?

No point asking us for solutions when we do not know what the objectives are. i.e. insufficient information for us to say.

Why not use a cheaper pension than HL?

Swapped it to Fidelity who do all the leg work and paid me a swapping bonus.

Add the caveat that they do not do all the legwork as you need to choose the investments within the SIPP.

billy2shots

SonOf wrote: »

Add the caveat that they do not do all the legwork as you need to choose the investments within the SIPP.

Nope, that’s wrong (as I’m sure you know).

Feel free to choose your own investments or swap like for like (in specie) where all the legwork is done for you.

Now the caveat. In specie might not save you much money if any. The funds you are currently invested in might not be right for you. In which case, a weekend spent learning can save you money in fees and help boost future earnings/lesson loses.

SonOf

Nope, that’s wrong (as I’m sure you know).

It is not wrong.

Feel free to choose your own investments or swap like for like (in specie) where all the legwork is done for you.

Reassure uses pension funds that are not able to be held in a Fidelity SIPP. So, in-specie transfers are not available. That means the OP will have to choose their own investments.

billy2shots

SonOf wrote: »

It is not wrong.



Reassure uses pension funds that are not able to be held in a Fidelity SIPP. So, in-specie transfers are not available. That means the OP will have to choose their own investments.

I must have imagined my HSBC Ftse all share transferring across.

JoeEngland

billy2shots wrote: »

I swapped a Reassure stakeholder pension to a Fidelity SiPP 13 months ago.

Reassure costs were 1% per year and I felt I had very little control over it.

Swapped it to Fidelity who do all the leg work and paid me a swapping bonus.

Fidelity do charge a platform fee of 0.35% plus your choice of funds on going charge. However I swapped into ETFs and ITs which cancel the 0.35% charge and replace it with £45 a year charge. ETFs and ITs are charged a trading fee of £10 to buy or sell or £2.50 (I think) for regular monthly purchases.

All the above factored in has me paying 0.36% a year compared to 1%.

Thanks, but what are ITs and ETFs?

SonOf

billy2shots wrote: »

I must have imagined my HSBC Ftse all share transferring across.

It's possible you selected the UT version of the pension fund version if it was an ex HSBC stakeholder pension or personal pension. i.e. you mapped the insured version to the closest UT/OEIC version. That would be not an in-specie transfer as Fidelity do offer any insured funds of the type that are used on personal pensions or stakeholder pensions. You cannot in-specie insured funds/pension funds.

The only scenario where a Reassure pension could use in-specie transfer to Fidelity is if the legacy reassure pension was a SIPP itself and used the UT/OEIC version on that SIPP. I am not aware of any SIPPs in their legacy range but I admit to not seeing all the plans they have bought in over the years.

Thanks, but what are ITs and ETFs?

If you need to ask that question, its a sign you shouldn't be using them.

SIPPs are pension option for the more experienced investor. That is why you get lower FSCS protection than a personal pension or stkaeholder pension as the Self Investment bit of a SIPP means there is less due dilligence carried out by providers as you are doing it.

In personal pensions and stakeholder pensions, they use insured pension funds. This has a higher level of research and due diligence applied to them and that is why they get higher consumer protection (100% FSCS protection with no upper limit).

ITs and ETFs are more advanced methods of investing compared to UT/OEICs. Neither gets any FSCS protection and require greater knowledge and understanding compared to both pension funds and UT/OEICs. There is nothing wrong with using ETFs and ITs. You just need to understand more than you would do compared to UT/OEICs. Things like gearing, NAV, replication methods etc.

[Deleted User]

JoeEngland wrote: »

Thanks, but what are ITs and ETFs?

Investment Trusts and Exchange Traded Funds. If you pick the right type of plain vanilla ETF, it could be the most cost and tax efficient vehicle for investing in the overall market. ETFs are very popular in N America. UK is behind but will catch up.

You need to do some reading.

JoeEngland

It seems like I need to do more research before making a decision. Maybe I need to check if one of my occupational DC pension providers can put my pension pots into a plan that allows drawdown but is covered by FSCS.

Albermarle

Maybe I need to check if one of my occupational DC pension providers can put my pension pots into a plan that allows drawdown but is covered by FSCS.

I would not worry too much about the FSCS , in relation to mainstream SIPP providers like HL or Fidelity.
More important than whether it is an a SIPP or an occupational DC scheme is the actual funds your money is invested in f .
An occupational scheme is simpler to operate and if you do not do anything you will be automatically invested in the default fund . However it might not be the best fund for you , especially as you move into drawdown.
So as suggested some research on funds, risk etc would be useful . Reading this forum more often could be a start.