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What is a SIPP?

Self-invested Personal Pensions (SIPPs) explained

Many people are unsure about what a SIPP is and how they differ from other pensions. SIPPs (Self-invested Personal Pensions) are designed to provide an income later in life, and they give you tax relief on your contributions like any other pension. The key difference is the greater control that a SIPP gives you over your retirement savings, as you have the freedom to choose from a wide range of investments and manage them for yourself.

Why choose a SIPP?

There are many reasons people choose to save for retirement with a SIPP:

  • Choice
    You get access to the same quality investments you may already have in your ISA, including a wide range of funds, investment trusts, ETFs and shares.
  • Flexibility
    It is easy to review and switch between investments, so you can make sure your pension is always working as hard for you as it should.
  • Price
    You won’t waste unnecessary money through fees if you choose a low-cost SIPP from the right provider.
  • Consolidation
    As you can bring your existing pensions together in a SIPP, it is simple to keep track of what you have already saved and make any changes.

Video – What is a SIPP?

The different types of SIPP

There are different types of Self-invested Personal Pension available:

  • Low-cost SIPPs – Often referred to as lite or vanilla SIPPs, low-cost SIPPs give you greater control over what you can invest in than other pensions. As their name suggests, low-cost SIPPs such as our Best SIPP are cheaper than full SIPPs.
  • Full SIPPs – A full SIPP gives you access to a wider range of investments than a low-cost SIPP, including structured products and commercial property. However, they generally have higher fees and are more suited to sophisticated investors.

What is the Best SIPP?

Our award-winning Best SIPP has market-leading pricing and gives you access to a wide range of investments, free investment research and a number of useful online tools. And if you’d prefer not to manage your own investments, there are several cost-effective ways that we can do it for you. Exit and drawdown fees apply.

Your Money readers voted us Best Direct SIPP Provider in 2015

Find out more about the Best SIPP

Who can have a SIPP?

Self-invested Personal Pensions are available to almost any UK resident who is under the age of 75, including children. You can also open a SIPP for someone else, for example a grandchild or partner. However, SIPPs are not suitable for everyone. If you don’t want to invest across different asset classes or don’t think you will make use of the investment choices that SIPPs give you then a SIPP might not be right for you. Self-directed investors should regularly review their SIPP portfolio, or seek professional advice, to ensure that the underlying investments remain in line with their pension objectives.

Important Information

SIPPs are not suitable for everyone. If you don’t want to invest across different asset classes or don’t think you will make use of the investment choices that SIPPs give you then a SIPP might not be right for you. Self-directed investors should regularly review their SIPP portfolio, or seek professional advice, to ensure that the underlying investments remain in line with their pension objectives. Prevailing tax rates and the availability of tax reliefs are dependent on your individual circumstances and are subject to change. Please note the term Best is a brand name of the Bestinvest SIPP.

OUR AWARDS

Past performance is not a reliable indicator of future returns

The value of your investment can go down as well as up, and you can get back less than you originally invested.

The Bestinvest Online Investment Service, including any account analysis and investment reports provided by our guidance services, is an online execution-only dealing service for investors who want to make their own investment decisions. It does not provide advice on the suitability of products and investments; if you are unsure about the suitability of any investment you should seek professional advice. Clients of our Investment Advisory Service and Managed Portfolio Service can use the website to obtain current valuations of their investments but cannot trade on these accounts online and should call their adviser if they wish to discuss changes to their investments.

Past performance or any yields quoted should not be considered reliable indicators of future returns. Restricted advice can be provided as part of other services offered by Bestinvest, upon request and on a fee basis. Before investing in funds please check the specific risk factors on the key features document or refer to our risk warning notice as some funds can be high risk or complex; they may also have risks relating to the geographical area, industry sector and/or underlying assets in which they invest. Prevailing tax rates and relief are dependent on your individual circumstances and are subject to change.

Issued by Bestinvest (Brokers) Limited (Reg. No. 2830297), which is authorised and regulated by the Financial Conduct Authority. Financial services are provided by Bestinvest (Brokers) Limited and other companies in the Tilney Bestinvest Group, further details of which are available here. This site is for UK investors only.
© Tilney Bestinvest Group Ltd 2016.

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