SIPPs which offer access to cash deposit accounts

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  • dunstonh
    dunstonh Posts: 116,038
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    Remember that the SIPP fees may exceed the cash deposit terms. Does it have to be a SIPP? You can get some cash accounts on stakeholders and PPPs which will have lower charges and allow UFPLS. The net return on those may be better overall.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • peterg1965
    peterg1965 Posts: 2,152
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    dunstonh wrote: »
    Remember that the SIPP fees may exceed the cash deposit terms. Does it have to be a SIPP? You can get some cash accounts on stakeholders and PPPs which will have lower charges and allow UFPLS. The net return on those may be better overall.


    No it doesn't have to be a SIPP at all, its the charges (minimum) and interest rate (maximum)on the cash that is the priority, I don't really care about the wrapper. My intent is to crystallise in 2 years, take the tax free money and then probably reinvest in a cautious income portfolio in readiness to start drawdown in about 5 years from now. If I have to transfer again in two years, so be it.


    It's just that I am keen to preserve the current value plus the next two years contributions and to take out all risk. I cannot afford to loose value in the next couple of years, for good reason.


    Can you please tell me who the SH/PPP providers are that you are thinking about Dunstonh
  • hyperhypo
    hyperhypo Posts: 179
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    very interesting to hear reasons for wanting to do this ...i have been dithering over when / how to transfer / create a cash pot of £50k within my current (150k) Sipp over next two years ...in readiness to spend the 50k over thewo years after that , prior to a DB scheme kicking in.
    Something's holding me back from doing it ...a siren voice saying keep it invested in your current mix of cautious/balanced MA type funds.

    So hearing what you're planning to do has encouraged me to do something ..i need to retain / cement of current value and only way to do so is to sell down assets now into cash. Did you ever consider cash like alterntives ...bonds ?
  • Thrugelmir
    Thrugelmir Posts: 89,546
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    hyperhypo wrote: »
    Something's holding me back from doing it ...a siren voice saying keep it invested in your current mix of cautious/balanced MA type funds.

    A fear of missing out? Rather than being happy with what you've got possibly.
  • Gatser
    Gatser Posts: 624
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    peterg1965 wrote: »
    Can you please tell me who the SH/PPP providers are that you are thinking about Dunstonh


    Yes... Can we please name names....

    This is something I have done with part of my pension pot.
    I have used a MINERVA SIPP with INVESTACC Pensions Admin.
    The admin charge is £480 but on £212k this is only 0.23% and it gives access to cash deposits paying 1.85% over 2 years so you still make 1.6% net.... far better than those cash accounts paying a mere 0.25%!
    THE NUMBER is how much you need to live comfortably: very IMPORTANT as part 1 of Retirement Planning. (Average response to my thread is £26k pa)
  • Thrugelmir...possibly that , but certainly a need to sort out the cash / liquidity absence within the current plan....

    Gatser...my aegon sipp charges 0.23% plus funds up to £250k but £75 each year for drawdown , so perhaps i should consider a transfer too..
  • peterg1965
    peterg1965 Posts: 2,152
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    hyperhypo wrote: »
    very interesting to hear reasons for wanting to do this ...i have been dithering over when / how to transfer / create a cash pot of £50k within my current (150k) Sipp over next two years ...in readiness to spend the 50k over thewo years after that , prior to a DB scheme kicking in.
    Something's holding me back from doing it ...a siren voice saying keep it invested in your current mix of cautious/balanced MA type funds.

    So hearing what you're planning to do has encouraged me to do something ..i need to retain / cement of current value and only way to do so is to sell down assets now into cash. Did you ever consider cash like alterntives ...bonds ?

    The reason I am looking to do this is to minimise the risk in my SIPP between now and Sept 2020. I have a resonably complicated pension situation, the SIPP only being a relatively small portion of my pensions. In 2020, I need to pay off the mortgage of a second property with the PCLS from the SIPP and that will be a specific amount - £63500 and I am carefully managing the SIPP to ensure it doesn’t go above c£265000 in Sept 2020 for LTA reasons. I have a further c £42000 to add to the SIPP (inc reliefs) over the next two years and need to do this for income tax/ personal allowance reasons.

    If I can get a guaranteed 1.8% interest on the SIPP with a cash savings account that will work out perfectly. I can them revert back to investing the drawdown fund post crystallisation, and I would consider a transfer into a simple low cost PPP or SIPP at that stage to do this.


    Gatser wrote: »
    Yes... Can we please name names....

    This is something I have done with part of my pension pot.
    I have used a MINERVA SIPP with INVESTACC Pensions Admin.
    The admin charge is £480 but on £212k this is only 0.23% and it gives access to cash deposits paying 1.85% over 2 years so you still make 1.6% net.... far better than those cash accounts paying a mere 0.25%!

    Gatser, that looks like it could be a good call, I have had a quick look at Minerva SIPP website and will be calling to discuss with them on Monday. £480/years isn’t so bad if I am getting 1.8% interest but I want to ensure there are no additional charges for holding cash. I also need to find out if I can still contribute over the next two years and not incur additional charge based on that.

    The website doesn’t list specific savings accounts from third party banks/building society, so hopefully that means that any ‘SIPPable’ saving account is permissible investment.

    I feel I’m potentially getting somewhere now!
  • Gatser
    Gatser Posts: 624
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    xylophone wrote: »

    The Close Bros offering appears ok if you are happy to have just their cash deposit account and the interest rate attached.
    I prefer a SIPP that allows choice from all available cash deposits
    THE NUMBER is how much you need to live comfortably: very IMPORTANT as part 1 of Retirement Planning. (Average response to my thread is £26k pa)
  • Gatser
    Gatser Posts: 624
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    PeterG: Investacc do not list any cash accounts because you can choose any SIPPable deposits you want.
    They provide a great service with the form filling cash deposits set up too.
    The other charge you will find is once you commence DD, £100 to cover payment processing and HMRC reporting etc which seems reasonable...
    THE NUMBER is how much you need to live comfortably: very IMPORTANT as part 1 of Retirement Planning. (Average response to my thread is £26k pa)
  • peterg1965
    peterg1965 Posts: 2,152
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    Thanks all.


    I contacted InvestecAcc pensions todays and I am impressed with their relatively simple SIPP model. I am setting up a Minerva SIPP with them and transferring my HL SIPP, c£212,000. I need to sell all of the current OEICs first, so that will be the longest part of the process.


    There are no charges for a transfer in and a flat rate of £480(inc VAT) per year, and no other charges which sounds reasonable. Once the SIPP is up and running I am applying to open three fixed rate savings accounts and will take out 3 x two year fixed rates bonds as follows:


    Investec @ 1.85% gross pa (£80,000)
    Close Brothers Savings @ 1.8% (£66,000)
    United Trust Bank @ 1.8% (£66,000)
    (All FCSC protected)


    Then I will continue to contribute £1275/net a month and trickle all those contributions into a Mansfield Building Society 90 day SIPP Trust notice account @ 1% pa. Plus I will probably make an additional £2k lump sum addition.


    So, in 2 years (provided tax relief rules are not changed) I will have approx. £262,500 at the point I wish to crystallise and take the 25%PCLS. Which is where I wanted to be and at absolute minimal risk. This will take up a further c24.5% of my LTA, leaving me with 14% left, and once that is used up its probably time to retire!
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