DIY Pensions with SIPPs
If you prefer a ‘do it yourself’ approach to your pension pot, we’re here to help you navigate the complexities of Self Invested Personal Pensions (SIPPs).
Unlike traditional personal pensions which limit your investment choice and capability, a SIPP is ideal for investors who wish to diversify their options for greater returns. They are flexible and tax efficient way to save for retirement.
A quick guide to SIPPs
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What is a SIPP?
A Self-Invested Personal Pension is a scheme that offers a greater level of flexibility and greater investment choices compared to conventional pensions. A SIPP may also be referred to as a ‘wrapper’ due to the fact that any investments you have placed within this ‘wrapper’ are dealt with in a certain manner.
- How does it work?
With a SIPP, you can choose to invest in a range of assets, where your money is then pooled and managed for you.
If you prefer a managed approach rather than choosing your funds, you can elect an investment manager to take care of your fund for you.
- Who qualifies?
Most people from the UK under the age of 75 are eligible to apply for a SIPP, but it is important you seek advice from a financial adviser if you are not a seasoned investor.
- What can I invest in?
There are a range of investments you can select for your SIPP, including: stocks and shares, commercial property, deposit accounts, unit trusts, government securities, insurance company funds and more
- What are the costs?
The charging structure depends on the SIPP and the investments that you choose. The annual charges applied to SIPPs usually start from around £250 + VAT or can be 1% of the transfer value, making it even more cost-effective. Also, there may be an additional one-off payment which starts from around £250 + VAT to set up the policy. You should note that the above figures are the approximate minimum charges only.
