Let us de-jargon and explain the benefits.
If you have looked into a pension product before, you have probably come across horrible terms such as robo advice, DB pension, GAR, and many more. A SIPP (Self Invested Personal Pension) is one of them. Let me explain what it is and how it works.
So what is it?
A Self Invested Personal Pension (SIPP) is a type of plan that gives you the freedom to invest in a wide range of assets. You can usually pick from options including stocks and bonds, several types of funds, policies and trusts. A SIPP puts you in the investor driving seat. You will make all the investment decisions.
A SIPP is flexible and portable: you can keep paying into it even if you change jobs or stop working. Your employer can also choose to contribute to your SIPP.
Some questions to ask potential providers:
- Is there a minimum contribution amount, and will I have to commit to regular payments?
- What charges apply to the plan, such as management fees and exit penalties?
- How will my money be invested and which investment funds will I have access to?
- Can I make lump sum payments as well as regular contributions?
- What kind of investment and retirement advice will I be offered?
Beware of outrageous fees
All pension plans will carry some costs to cover the management and administration. Unfortunately, many providers will make the process of finding out how much you’re being charged very complicated, offering you hundreds of funds to choose from with a multitude of fee types. The charges can really add up. Read more about 5 outrageous pension fees SIPP providers will charge you.
Try the PensionBee option
PensionBee offers just a few plans (not hundreds) to give you some of the best options to save for your retirement. Find out more about PensionBee plans.
As always with investments, your capital is at risk