A nine out of 10 for the TD Sipp
T D Waterhouse - TD Sipp
Type: Full Sipp
Minimum investment: £400, £40 a month for individuals, £50 a month for employers, transfers in lump sum £1,000
Minimum-maximum ages: 18 to 74
Investment choice: All investment funds, exchange traded funds, bonds, gilts, UK and international equities Reits and other assets approved for investment by HM Revenue & Customs excluding commercial property, with ability to hold cash in nine major currencies
Options: Unsecured pension, alternatively secured pension
Charges: Half-yearly 0.25% administration charge subject to a £40 minimum and £100 maximum plus VAT, transfer out of stock £35 plus VAT, plan transfer out fee £75 plus VAT, Unsecured Pension £150 a year plus VAT, alternatively secured pension £250 a year plus VAT, additional income withdrawals £75 plus VAT, annuity purchase £75 plus VAT, additional charges for insufficient funds to pay benefits and for death benefit payments.
Commission: Agreed between adviser and client
This self-invested personal pension allows investment in a range of permitted investments but not commercial property.
Informed choice managing director Martin Bamford says: “This is a low-cost Sipp with access to a comprehensive range of investment options, including exchange-traded funds and Reits. It comes with a number of useful market information and research tools, enabling investors to make their own investment decisions if they do not use an adviser.”
Bamford observes that the plan has no set-up fee or transfer in charge, and feels its half-yearly administration charge of 0.25 per cent, is competitive. “There is access to 780 funds with no initial charge payable. More sophisticated investors will appreciate the ability to invest in any of nine major currencies,” he says.
The scheme administrator for this Sipp is A J Bell, which has an excellent reputation in the Sipp market in Bamford’s view.
Turning to the potential drawbacks of the product Bamford says: “There is very little not to like about this Sipp. The cash deposit account is not currently paying any interest, as it only offers interest at 1 per cent below the Bank of England base rate.” He adds that if investors transfer away from this Sipp, there is a £75 plus VAT charge. However, he says this sort of charge is increasingly common in the Sipp market.
Discussing the main competitors, Bamford says: “Sipp Deal, also administered by A J Bell, is a clear competitor. It has no setup charge and a wide range of available investment funds, with over 1,500 having no initial charge.” He also expects the Vantage Sipp from Hargreaves Lansdown to provide competition.
Summing up Bamford says: The ability for investors to instruct the Sipp to pay advice charges to a third-party adviser is a nice feature that will make this Sipp suitable for execution-only customers and advised clients.”
Suitability to market: Good
Adviser remuneration: Good