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    • Sue S
    • By Sue S 17th Apr 18, 9:38 AM
    • 254Posts
    • 180Thanks
    Sue S
    SIPP and investments on different platforms?
    • #1
    • 17th Apr 18, 9:38 AM
    SIPP and investments on different platforms? 17th Apr 18 at 9:38 AM
    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. Iím 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 (Iím 62 and not working but with a good income).
Page 1
    • Linton
    • By Linton 17th Apr 18, 9:54 AM
    • 9,378 Posts
    • 9,508 Thanks
    Linton
    • #2
    • 17th Apr 18, 9:54 AM
    • #2
    • 17th Apr 18, 9:54 AM
    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.
    • cloud_dog
    • By cloud_dog 17th Apr 18, 9:58 AM
    • 3,686 Posts
    • 2,185 Thanks
    cloud_dog
    • #3
    • 17th Apr 18, 9:58 AM
    • #3
    • 17th Apr 18, 9:58 AM
    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. Iím 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 (Iím 62 and not working but with a good income).
    Originally posted by Sue S
    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.
    Personal Responsibility - Sad but True

    Sometimes.... I am like a dog with a bone
    • Alexland
    • By Alexland 17th Apr 18, 10:38 AM
    • 2,388 Posts
    • 1,789 Thanks
    Alexland
    • #4
    • 17th Apr 18, 10:38 AM
    • #4
    • 17th Apr 18, 10:38 AM
    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.
    Last edited by Alexland; 17-04-2018 at 10:53 AM.
    • zagfles
    • By zagfles 17th Apr 18, 10:47 AM
    • 13,009 Posts
    • 11,048 Thanks
    zagfles
    • #5
    • 17th Apr 18, 10:47 AM
    • #5
    • 17th Apr 18, 10:47 AM
    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.
    • coyrls
    • By coyrls 17th Apr 18, 11:00 AM
    • 971 Posts
    • 1,033 Thanks
    coyrls
    • #6
    • 17th Apr 18, 11:00 AM
    • #6
    • 17th Apr 18, 11:00 AM
    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.
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