Cash SIPP - HL still best option?

masca

Apologies if this has been discussed elsewhere recently, but a search didn't turn anything up.

I wish to open a SIPP before the end of the financial year to deposit £2,880 pa in until I'm 55. I don't plan to trade, and will just hold as cash for a few years. Is HL still considered to be the preferred platform for this? Or is there perhaps a better deal out there in terms of referrals, bonuses and/or interest? TIA!

dunstonh

Are you aware the normal minimum pension age is due to increase from 55 to 57 on 6 April 2028? For anyone born on or after 6 April 1973, access will generally be from 57 (unless they have a protected lower pension age - but that only applies to some existing plans - not one you intend to open), so if you are “a few years” away and expecting to take benefits at 55 you may actually be looking at 57 instead.

masca

https://forums.moneysavingexpert.com/discussion/comment/81936671#Comment_81936671

Yes, I am aware... Yes, I had forgotten!!!! 🙄 Thank you very much for the reminder!

masca

Based on the above, I'll have made 7 annual deposits before I can withdraw anything... and I'll have to withdraw over 2 tax years in order to avoid paying tax. At the risk of drifting my own thread, is this still the time to start depositing £2,880 annually? 🤔 The maths is hurting my head!

LHW99

Why not? You'll get it topped up to £3600 each time - what's not to like?

For seven / eight years, you could even think of a low(er) equity fund like VLS 20 for at least some of it.

kipsterno1

HL have recently changed their fee structure so it maybe worth comparing the charges against other platforms. There is quite a lengthy and useful thread on the new fees.

SacredStephan

HL and Fidelity do not charge for uninvested cash in a SIPP.

OldScientist

HL (and Fidelity) currently pay about 2.2% interest on uninvested cash in a SIPP, while short term money market funds/ETFs are currently paying about 3.75% before fees (fund and platform). You will have to calculate whether the difference in interest rate offsets the fees. For example, with Fidelity if you set up a regular savings plan, the fee of 0.35% would reduce the MMF return to roughly 3.4%. Without the regular savings plan, the fee of £7.50 per month would be 2.5% of the first years contribution (1.25% after two annual contributions, etc.) and reduce the return to 1.25% in the first instance.

Veloflyer

I too am with HL - with 100K plus (uncrystallized) invested in global trackers. I intend to leave it as is for @ 5 years, the possibly drawdown from it. I have also seen various negative comments ref. fees, length of time it takes to transfer out, poor service in general when it comes to drawdown, length of time taken for TFLS to hit current account etc.

Opinion welcome as to whether I should remain with them or transfer it all to (say) Bell, or are all platform providers pretty much the same and thus there is little to gain?

Have to say HL have been OK so far, but then again, they have had little to do.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81938332#Comment_81938332

The threads about poor service with HL have been mainly in more recent times, so something seems to have happened. Could be new owners? I think all the stuff about people withdrawing tax free cash and wanting to put it back again due to budget speculation caused issues. Then recently their tweaking of their fees, seems to have prompted an increase in transfers out, and has put pressure on their admin.

Maybe they will revert back to normal at some point.

QrizB

The threads about poor service with HL have been mainly in more recent times, so something seems to have happened. Could be new owners?

They were bought out by a private equity firm last year, so you might reasonably expect fees to rise and service to get worse (which is what seems to happen in those circumstances).

https://moneyweek.com/investments/hargreaves-lansdown-takeover-what-it-means-for-your-money