Switch from SL Pension One to an Interactive Investor Sipp

dharm999

I am looking to move my pension from SL Pension One, a very old plan, to a sipp with Interactive Investor.  The current costs on my SL plan are c.1.39%p.a., and by moving to II, I should be able to save at least 0.5% of that, which will make a significant difference to my pension pot, will be c£700k when I plan to retire, in 5 years time.  It will also offer greater options for investing.  There are no guaranteed elements to my SL plan, so I can't see any major reason to stay with them, especially given the size of the pot at the moment, of around £360k.  The plan is to have the majority of the money in a 60/40 or 70/30 tracker, with  smaller amounts in emerging markets, property, renewables and gold sectors.  i have an ISA with Vanguard, the VLS 60% as well as HSBC Strategy balanced, outside of my ISA, so have experience of trackers already, 

I know the II sipp will give more more options to invest than the current SL plan,  is there a sufficiently wide choice with II?  My focus is low cost trackers or etfs, where possible.  The aim is to lower my cost and also widen my options, and i would definitely lower my costs, but would the options be sufficiently wide enough?

Thanks for the help

Albermarle

Most of the mainstream low cost SIPP's ( II; HL; Fidelity: AJ Bell etc ) offer a similar range of possible investments. The range is probably big enough for >99% of investors.
Have you investigated moving your pension within SL to a new pension?
If you call them and say you are thinking of moving , you might be surprised by the discounts that maybe offered.
Still might be better to move but probably worth checking . One advantage of staying with SL is that your investments are covered 100% for compensation, whereas with ii ( or similar ) they are not , although in reality this is very unlikely ever to be an issue.

dharm999

Albermarle said:

Most of the mainstream low cost SIPP's ( II; HL; Fidelity: AJ Bell etc ) offer a similar range of possible investments. The range is probably big enough for >99% of investors.
Have you investigated moving your pension within SL to a new pension?
If you call them and say you are thinking of moving , you might be surprised by the discounts that maybe offered.
Still might be better to move but probably worth checking . One advantage of staying with SL is that your investments are covered 100% for compensation, whereas with ii ( or similar ) they are not , although in reality this is very unlikely ever to be an issue.

I have looked, and SL offer an Active Money Personal Pension plan, which would give a 0.5% discount to the charges, once the plan value it £500k, so i could achieve  similar saving, with less potential problems.  Will need t look at it, to see what fund choice there is

Thanks

shortseller09

So you expect to grow your pot by 100% in 5 years time, or am I mistaken?

AnotherJoe

OP could be adding £40k a year for the next 5 years ? So then its £560 -> £700 .

Albermarle

I have looked, and SL offer an Active Money Personal Pension plan

The active money plan has two options , one where they almost pick the funds for you and a DIY one with about 240 funds to choose from . Lowest charge is 1%, then extra for more actively managed/niche funds. Then minus the discount. You might well be able to prod them into a bigger discount , especially if you mention moving to Interactive Investor ! 

There is also an SL SIPP - Level 1 is basically the same as the DIY option above ( For mainly technical reasons most personal pensions are moving towards the SIPP format and they may suggest this ). 

dharm999

shortseller09 said:

So you expect to grow your pot by 100% in 5 years time, or am I mistaken?

Its c£360k now, with £40k a year for 5 years  and real annual growth of 3%, which gets me to just over £700k, give or take a little bit.

dharm999

Albermarle said:

I have looked, and SL offer an Active Money Personal Pension plan

The active money plan has two options , one where they almost pick the funds for you and a DIY one with about 240 funds to choose from . Lowest charge is 1%, then extra for more actively managed/niche funds. Then minus the discount. You might well be able to prod them into a bigger discount , especially if you mention moving to Interactive Investor ! 

There is also an SL SIPP - Level 1 is basically the same as the DIY option above ( For mainly technical reasons most personal pensions are moving towards the SIPP format and they may suggest this ). 

Thanks, will take a look at their fund options. I will ask them about a larger discount, if you don't ask, you don't get, I guess.