SIPP and investments on different platforms?
Sue_S
Posts: 302 Forumite
Some people seem to advise using different platforms for safety/security reasons. Is this really something I need to be concerned about?
Currently I have a S&S ISA with IWeb, invested in Vanguard LifeStrategy. I’m looking to combine 2 pension pots, about £250k, into a SIPP, again using LifeStrategy funds. I only need the tax free lump sum and plan to leave the rest for the foreseeable future (I’m 62 and not working but with a good income).
Currently I have a S&S ISA with IWeb, invested in Vanguard LifeStrategy. I’m looking to combine 2 pension pots, about £250k, into a SIPP, again using LifeStrategy funds. I only need the tax free lump sum and plan to leave the rest for the foreseeable future (I’m 62 and not working but with a good income).
0
Comments
-
I do not think a platform going bust and lossing all your investments is a significant risk. However an extended computer failaure may be more likely so you could consider different platforms for your SIPP and ISA since there are no advantages in both being on the same platform. Any transfers between the two would almost certainly have to go via your bank current account anyway.0
-
I think it is a personal preference due to the compensation limit of £50k for investments. As Linton says, the likelihood of something occurring is very, very low.Some people seem to advise using different platforms for safety/security reasons. Is this really something I need to be concerned about?
Currently I have a S&S ISA with IWeb, invested in Vanguard LifeStrategy. I’m looking to combine 2 pension pots, about £250k, into a SIPP, again using LifeStrategy funds. I only need the tax free lump sum and plan to leave the rest for the foreseeable future (I’m 62 and not working but with a good income).Personal Responsibility - Sad but True
Sometimes.... I am like a dog with a bone0 -
It's a low probability, high impact risk.
I don't see why anyone would take the risk of putting everything (ISAs and SIPPs) into Vanguard LS given there are similar low cost fund series such as HSBC Global Strategy and Blackrock Consensus.
We have 3 accounts over the FSCS limit (2 of them are a result of me splitting my similar sized pension to reduce this exposure) but if we suffered losses with any individual platform or fund manager as a result of fraud, etc and were only compensated £50k it would be extremely annoying but not the end of the world.
Alex.0 -
Remember that investments held on a platform are not subject to the same main risk as money held in a bank. Investments held on the platform will be beneficially owned by you, so if the platform provider goes bust, they can't use your investments to pay their debts. The platform provider does not lend your investments to others, like banks do with cash, so aren't subject to the same risk.
They would be subject to a risk like a massive fraud where someone hacks into the platform and transfers all the investments away. But I think it's highly unlikely it could happen on a scale large enough to make a big platform go bust without someone noticing. Maybe possible, but IMO there are far more important things to worry about in life.
FSCS protection is far more important for bank deposits than it is for investments.0 -
[FONT="]Having transferred more than once from platforms as a result of pricing changes, I can add one advantage with having a SIPP and an ISA on different platforms which is that at least you will only have one transfer to deal with if one of your platforms makes a radical change to their pricing.[/FONT]0
This discussion has been closed.
Categories
- All Categories
- 343.2K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608K Mortgages, Homes & Bills
- 173.1K Life & Family
- 247.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards