Harnett Accountants Fulham Brings You This Report On SIPP’s

Two in three SIPP’s are being mismanaged or ignored according to this report from The Telegraph, brought to you by Harnett Accountants Fulham:

Self Invested Personal Pensions (Sipps) have been dubbed Self ‘Ignored’ Personal Pensions by Investec Wealth & Investment, after their new research showed that less than one in three investors feel they have the expertise to manage them properly.

Significant numbers of investors are failing to maximise the potential of their Sipps with only 37pc of people saying they had enough time to devote them.

The idea of managing one’s own pension can be initially appealing, but in reality, many people subsequently find they do not have the time or knowledge required to achieve maximum returns on their investments. As a result many are paying extra charges for the flexibility of a Sipp which they are not then using.

Chris Aitken, spokesperson for Investec Wealth & Investment, said: “Managing a Sipp properly requires time, expertise and a strong understanding of market risk and appropriate set allocation. Unfortunately, for many people this is simply too difficult. We’d advise anyone who is concerned about having a ‘Self-Ignored Personal Pension’ to take professional advice.”

The survey showed that just under half (45pc) of those self-managing their Sipps actually fully understand the charging structures from their providers., while 15pc of those who currently managed their own Sipp said they were likely to appoint an investment professional to do so within the next 12 months.

Mr Aitken said: “This is a poor reflection of some Sipp providers and it’s also a call to action for investors to better understand what they are paying for, and whether or not their current plan represents good value and is the right product for them. Many Self ‘Ignored’ Personal Pension holders probably don’t fully understand the flexibility and power that a Sipp can provide.”

Alternative and less costly choices to Sipps include company pension schemes and cheaper stakeholder or personal pension plans, both of which do not require investors to monitor holdings as frequently.

Pension experts said that anyone saving for retirement should first of all maximise workplace pension schemes, particularly if their employer also paid into the plan. Although Sipps offer greater flexibility, many personal pension now offer a wide range of funds, sometimes at a fraction of the cost of a “full-Sipp” which also allows investors hold property, direct shareholdings, investment trusts and exchange traded funds.




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