Trying to find a SIPP platform and fund that can be essentially hands off in retirement?

RogerPensionGuy

I think I'm looking for something that may not exist, any pointers or signposts welcome please. 

I'm about 60, have stopped paid employment, no debts, house owned outright, plus an good DB pension indexed linked to a maximum of 5% PA and a full state pension at age 67 and don't need any extra income to maintain my lifestyle even if I up my actual spending 20 or 25% with all the above in mind.

I have a S&S and a cash ISA that will cater for any big spending that I likely need and can't see me even using much of these unless I buy a couple of Ferrari type cars or have lots of holidays & travel etc.

My dilemma is I also have a SIPP that just sits in the background and thankfully don't have any needs or plans to use any unless I buy cars or do more holidays etc.

I'm unphased by IHT for information and partner is fully self finianced, so I'm like a single person reference financial planning. 

Finally to my question. 

I would like my SIPP value to start making payments to me monthly as I settled in a non working lifestyle. 

I guess I could just use a low cost SIPP and maybe pick a Vanguard Life Stratagy fund that is income that pays out say 2% PA, lets say approximate income is 2% or say 10 to 12K PA.

With all the above in mind, I'm thinking I could just set a monthly payment of say 1K PM and get the platform to make payments outa the cash or hoping the cash would be in Money Market Funds. 

I'm guessing the above would be simple, set & forget. 

If later on I needed more monthly income, I could just convert X amount of the Life Stratagy and put in the cash/MMFs to allow bigger monthly withdrawals.

***

I was originally looking for a platform/fund that would say keep 3 or 4 years of withdrawals in cash/MMFs and the rest in typically high risk/reward units like risk 6 out of a risk index of 7 being the maximum and the platform would just sell units during markets highs to keep the cash/MMFs at least 2 years or even up to 6 or 7 years if highs were indeed very high.

I probably haven't explained it well. 

I think I want a unicorn plan, totally or 99% hands off and just keep 3, 4, 5 or 6 years of PA withdrawls in liquid cash and avoid selling units in any market dips.

An annuity or two could work, but like the idea of long term market returns incase I live long and my spending goes up silly ref care fees etc. 

Any views, pointers most welcome. 

Think I'm looking for a utopian plan or system that doesn't exist in a low cost platform with me or another person being involved. 

Cheers Roger.

Dazed_and_C0nfused

RogerPensionGuy said:

I think I'm looking for something that may not exist, any pointers or signposts welcome please. 

I'm about 60, have stopped paid employment, no debts, house owned outright, plus an good DB pension indexed linked to a maximum of 5% PA and a full state pension at age 67 and don't need any extra income to maintain my lifestyle even if I up my actual spending 20 or 25% with all the above in mind.

I have a S&S and a cash ISA that will cater for any big spending that I likely need and can't see me even using much of these unless I buy a couple of Ferrari type cars or have lots of holidays & travel etc.

My dilemma is I also have a SIPP that just sits in the background and thankfully don't have any needs or plans to use any unless I buy cars or do more holidays etc.

I'm unphased by IHT for information and partner is fully self finianced, so I'm like a single person reference financial planning. 

Finally to my question. 

I would like my SIPP value to start making payments to me monthly as I settled in a non working lifestyle. 

I guess I could just use a low cost SIPP and maybe pick a Vanguard Life Stratagy fund that is income that pays out say 2% PA, lets say approximate income is 2% or say 10 to 12K PA.

With all the above in mind, I'm thinking I could just set a monthly payment of say 1K PM and get the platform to make payments outa the cash or hoping the cash would be in Money Market Funds. 

I'm guessing the above would be simple, set & forget. 

If later on I needed more monthly income, I could just convert X amount of the Life Stratagy and put in the cash/MMFs to allow bigger monthly withdrawals.

***

I was originally looking for a platform/fund that would say keep 3 or 4 years of withdrawals in cash/MMFs and the rest in typically high risk/reward units like risk 6 out of a risk index of 7 being the maximum and the platform would just sell units during markets highs to keep the cash/MMFs at least 2 years or even up to 6 or 7 years if highs were indeed very high.

I probably haven't explained it well. 

I think I want a unicorn plan, totally or 99% hands off and just keep 3, 4, 5 or 6 years of PA withdrawls in liquid cash and avoid selling units in any market dips.

An annuity or two could work, but like the idea of long term market returns incase I live long and my spending goes up silly ref care fees etc. 

Any views, pointers most welcome. 

Think I'm looking for a utopian plan or system that doesn't exist in a low cost platform with me or another person being involved. 

Cheers Roger.

I think what you really want is something that needs your input.  Not on a day to day basis but it doesn't sound like something that is a mass market SIPP option.

But maybe cutting out a lot of the waffle/unnecessary detail would make it easier for people to understand?

Marcon

How about a non-SIPP personal pension?

Triumph13

It would seem like the obvious thing to do would be to use half the SIPP to buy an annuity at the income level you desire, and simply leave the other half invested for growth to cover future care costs.  Gets what you want with a minimum of ongoing hassle.

QrizB

Triumph13 said:

It would seem like the obvious thing to do would be to use half the SIPP to buy an annuity at the income level you desire, and simply leave the other half invested for growth to cover future care costs.  Gets what you want with a minimum of ongoing hassle.

 I was going to suggest something along these lines, too.

badmemory

I wondered if what would be more use to you would be to use the SIPP now & not take the DB pension yet.  What would concern me is the max increase on the DB of 5%.

RogerPensionGuy

badmemory said:

I wondered if what would be more use to you would be to use the SIPP now & not take the DB pension yet.  What would concern me is the max increase on the DB of 5%.

A good point and that was certainly an option in my little head. 

Unfortunately, at about 60 years old, my DB(already deferred) commutation rate was elevated to a pretty high factor, plus the LTA was fully gone by April 2024 and I pulled that lever. 

Another factor I activated the DB and took max poss tax free was I was concerned the government could just possibly reduce that 268K figure possibility, I was aware when governments reduced LTA previous, they put in place various protections, but I had no confidence they would do the same in future, so I activated and thus removed myself from wanting employment, so another person jumping out of the workforce. 

Thankfully I'm totally unphased by the SIPP IHT changes a-coming, but would like the SIPP to be fully(80%) invested and just draining out a bit as I like and not wanting the SIPP to sell units in a big old dip. 

I'm feeling a fair option for me is to just use a Vanguard LS% income unit and put income in to MMF/cash and just get the platform to use cash/MMFs, I could set the PA withdrawals to about the income and probably ensure the MMF/cash had a good few years finding at the start. 

I think the above gives a pretty hands off approach and very minimal input from me. 

Also getting an annuity or 2 could further make it hands off, load lock & forget. 

Cheers Roger. 

hara____

If you don't want to commit to Triumph13's helpful suggestion, you could put half the SIPP into a gilt with a chunky coupon (and the right maturity date for you) and the rest into an equity fund. The gilt gives you your regular income and the equity fund can grow in the background.

Could work with either an index linked gilt or a nominal.

DRS1

It sounds like you want what I have with my HL GIA.  I have it set so that the income is paid out once a month.  If they can do it for a GIA could they not do it for a SIPP?  I know there would be tax to deduct and questions about whether any bit of it was a TFLS but if you confirmed you had used up all your LSA then it could be just like drawdown from a crystallised pot where everything is taxable.

Albermarle

DRS1 said:

It sounds like you want what I have with my HL GIA.  I have it set so that the income is paid out once a month.  If they can do it for a GIA could they not do it for a SIPP?  I know there would be tax to deduct and questions about whether any bit of it was a TFLS but if you confirmed you had used up all your LSA then it could be just like drawdown from a crystallised pot where everything is taxable.

I think the OP has not taken into account, that decisions have to be made about how to take the tax free part and the taxable part. 
You can not just say to the pension provider, pay me the annual income from the fund, without first deciding how to handle the tax free/taxable split ( and if the provider can do what you want).

ColdIron

DRS1 said:

It sounds like you want what I have with my HL GIA.  I have it set so that the income is paid out once a month.  If they can do it for a GIA could they not do it for a SIPP?  I know there would be tax to deduct and questions about whether any bit of it was a TFLS but if you confirmed you had used up all your LSA then it could be just like drawdown from a crystallised pot where everything is taxable.

The GIA pays out dividends on or around the 14th. The amounts vary with your dividends, no dividend no payout. The SIPP works differently as it uses PAYE. It pays out on or about the 28th and will be the amount that you instructed even if there are no dividends, e.g. £1,000 or whatever. I keep a year or two cash float to ensure I have sufficient cash available for peace of mind and to avoid being a forced seller. Ideally your annual withdrawals would more or less match your average dividends