Should I combine a workplace SIPP with personal SIPP?

older_and_no_wiser

I currently have two SIPPs - one is my workplace DC fund with around £250K in it (Hargreaves Lansdown with annual 0.25% charge) and the other is a personal SIPP which has £170K in it (Interactive Investor with annual flat charge of £240). 

I am contributing to both SIPPs each month. I have increased my workplace contributions recently and contribute via salary sacrifice. I also contribute to the personal fund separately via direct debit. 

I was recently told (on this forum!) that it would be a good idea to stop contributing to the personal SIPP and put that contribution into the workplace SIPP as additional salary sacrifice contribution which will save me NI contributions too. I have just arranged this with my employer and am kicking myself I didn't realise this earlier! Anyway, we can't change the past!

I am now wondering if there's any benefit to me combining the two pensions. I would need to transfer (as cash because it's much quicker) the II SIPP into the workplace SIPP (HL). However, if I did this, I would be paying an additional £200+ each year in fees because HL charge a percentage of the fund value whereas with II, I pay a flat fee.

I should say that there's no way I can combine the two SIPPs into the Interactive Investor account. My employer will only contribute to the HL fund.

I'm happy to leave the two SIPPs separate but wondering if there's any value in combining when it comes to my retirement, crystallisation and flexi drawdown (e.g. possible tax benefits?) having one or two pots. I will be retiring in around 5-6 years time at around 58 years old.

AlanP_2

If they both offer the investments you want then no benefit to merging by the sounds of it.

You may want to consider moving the HL pot to II once you have left the employer as charge likely to revert to standard 0.45%.

Other option to explore could be a partial transfer of HL pot to II, leaving it open for future employer contributions whilst putting the bulk of it on the cheaper platform. 

older_and_no_wiser

Thanks @AlanP_2. That's very useful information!

Albermarle

Some would say it is also a good idea not to have all your eggs in one basket. Also even if there is no substantive risk, IT meltdowns are not unheard of, companies can get taken over , customer service standards slip, charging structures can change etc .

jamesd

Yes, salary sacrifice into the HL plan would be a good move. Then partial transfers out from time to time into the other one to save charges.

Hansplace

Moving to one pot is for easier control and less fee as most platform have a cap after certain amount.
AJBell have a maximum cap of £10 a month

Albermarle

Hansplace said:

Moving to one pot is for easier control and less fee as most platform have a cap after certain amount.
AJBell have a maximum cap of £10 a month

This cap only applies to exchange traded products as far as I know . For funds it is 0.25% with no cap .