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Introduction to your SIPP 'default option'

We have introduced something called a 'default option' for your Self-invested Personal Pension (SIPP), which we explain in more detail below.

What is a default option?

  • A default option is a target retirement fund we offer to clients based solely on the length of time until your planned retirement date
  • The aim of a default option is to meet the needs, objectives and characteristics of a typical SIPP client who has not taken advice, but is not tailored to the specific needs, objectives or characteristics of each retail client
  • This is something the Financial Conduct Authority (FCA) has asked all business like ours to do, so that you have a default investment option when you open a new Self-invested Personal Pension with us, or if you already have a SIPP with us but it’s currently only holding cash

What a default option is not

  • It’s not an investment recommendation; it’s an option that is based on your target retirement age and may not be appropriate to your individual circumstances
  • However, it can be useful if you’re not sure what to invest in and have not yet taken any advice
  • We encourage you to fully consider your own personal circumstances and speak to a Bestinvest Coach about your plans or choose one of our cost-effective advice packages if you would like personalised investment advice.

What is the default option Bestinvest offers and why have you selected it?

At Bestinvest, we use the Vanguard Target Retirement fund range as our default option.

These funds use a technique called ‘lifestyling’, which means that your savings are automatically gradually moved out of higher risk investments (such as shares) into lower risk investments (such as bonds and cash) as you get closer to your retirement date, without you needing to do anything.

This range of funds is predominately invested in other funds with some direct investment in shares; the majority of the funds that are used are passive funds that aim to track an index, such as the FTSE 100.

We chose this range for the following reasons:

  • We believe it has been designed to meet the needs, objectives and characteristics of a typical SIPP client who has not taken advice
  • We consider that a typical SIPP client wants to both grow and preserve a retirement pot over time, with the focus shifting towards preserving capital as retirement begins and clients might need to drawdown from their SIPP
  • A typical client with this objective wants to take a more ‘hands off’ approach to their SIPP investment

This lifestyling approach is suited to the needs of a typical “hands-off” SIPP client as it reduces the risk of an investment as they get closer to retirement.

If for any reason you think your needs are not well-matched to the aims of the SIPP default option, please consider other options and/or speak to a Bestinvest coach.

The value of the higher risk investments in the earlier stage of investing can fall as well as rise. The value of your pension pot when you come to take benefits may be less than has been paid in.

Who will be presented with a default fund?

If you open a SIPP with us we will offer you a fund option based on your target retirement date.

If you’re already a client with a SIPP we will also offer you a default fund option if your entire SIPP is still in cash rather than being invested, or if you currently have £0 balance in your SIPP.

If you’re an existing SIPP customer and your SIPP is invested, we will not offer you a default fund, although you can choose to invest in one of these funds. You can always call to ask us what the default option would be for your SIPP – just remember that this is not a personalised investment recommendation and you might prefer to speak to a Coach or take advice.

How do I choose which default fund is right for me?

We will offer you an appropriate fund based on the target retirement date you told us when you opened your SIPP.

The year in the fund range (e.g. “2055”) will be the year you are intending to retire or the nearest year before this. For example, we will offer you the Vanguard Target Retirement 2055 fund if you are looking to retire between 2055 and 2059.

Tip: most people retire between the ages of 63 and 68 and remember that you typically won’t be able to withdraw any money from your pension until at least the age of 55.

Which Vanguard Target Retirement fund will I be offered?

The table below provides a breakdown of the fund we will present to you based on your retirement year. Click on the fund name to view the factsheet.

Retirement year Your Target retirement fund
2024 and earlier Vanguard Target Retirement 2020 A
2025-2029 Vanguard Target Retirement 2025 A
2030-2034 Vanguard Target Retirement 2030 A
2035-2039 Vanguard Target Retirement 2035 A
2040-2044 Vanguard Target Retirement 2040 A
2045-2049 Vanguard Target Retirement 2045 A
2050-2054 Vanguard Target Retirement 2050 A
2055-2059 Vanguard Target Retirement 2055 A
2060-2064 Vanguard Target Retirement 2060 A
2065+ Vanguard Target Retirement 2065 A

Should I invest in my default option?

Selecting your choice of investment(s) for your SIPP, as with any other account, is a personal choice.

We encourage you to consider a variety of factors when making investment decisions, including how long it is until you need to access you pension, your attitude to risk, your need for growth and your capacity for loss. See more on what we call “the pillars of risk” here.

The SIPP default option is an option that could be right for you, but it has not been tailored to your individual needs and this is your decision.

If for any reason you think your needs are not well-matched to the aims of the SIPP default option, please consider other options and/or speak to a Bestinvest coach.

If I invest my pension in a default fund, what happens when I get closer to retirement?

You do not need to do anything; the Target Retirement range of funds is designed to automatically reduce risk in your portfolio as you approach and enter retirement to protect your savings from greater losses.

However, we encourage all clients to regularly review their investment portfolio and planned retirement age and consider whether it is still best suited to their needs and goals for their money.


Reminder: the default fund option presented to you does not constitute a tailored investment recommendation.

If you want to discuss your investments or have any questions about planning for and structuring an income during retirement please speak to a Coach or book an advice call with us.

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