Type: Online self-invested personal pension
Minimum investment: No minimum
Minimum – maximum age: From birth to 74
Investment choice: Over 1,800 discounted funds through the James Hay Investment Centre trading platform comprising collect and select fund ranges, direct equity transactions via Selftrade, cash panel, discretionary fund management panel
Options: Unsecured pension/income drawdown, alternatively secured pension
Charges: Annual £180, annual income drawdown charge £150, transfers in £50, in specie transfers £50 each, contribution direct debit amendment £25, benefit calculation £100, review of income limits £100, setting up an investment management account £50, setting up cash deposit with James Hay Partnerships panel £15, arranging transfer out/annuity purchase £150, overseas transfer £400, select funds annual 0.75%, collect funds initial and annual charges dependent on fund, additional charges for Selftrade and DFM services
Commission: Initial up to 3%, renewal up to 3%, plus initial up to 3% on Collect fund range
This online self-invested personal pension from James Hay Partnership aims to provide the benefits of a Sipp at a lower cost. It has no set-up fee, no minimum investment and provides access to a range of investments through a fund supermarket, a share dealing service, a discretionary management service and a range of cash deposits.
Informed Choice managing director Martin Bamford sees this as a reasonably comprehensive and competitively priced online Sipp, available to both IFAs and direct to the public. “ It offers a clean pricing structure and access to a wide range of funds as well as the ability for investors to trade directly, delegate responsibility to a discretionary fund manager or access fixed-term deposit accounts,” says Bamford,
He points out that the James Hay Partnership website contains lots of clear information and provides access to a comprehensive range of literature.
Discussing the less appealing features of the Sipp, Bamford says: “The pricing structure looks competitive at first glance, but costs soon add up for various options. In addition to the £180 annual fee, there is a £50 charge for each transfer-in, £50 to establish contributions and £150 to transfer out or purchase an annuity.”
Bamford also finds the fixed-term deposit panel very limited at present, with six and 12-month term deposits on offer from only three providers. “The discretionary fund management panel is also quite limited, with only three managers currently available,” he says.
Scanning the market for potential competitors Bamford says: “A clear competitor is the Ascentric pension account, with similar charges but access to a more comprehensive range of investment funds, fixed term deposits and discretionary fund managers.”
Summing up, Bamford says: “This Sipp is based in Jersey, to achieve a VAT-exempt charging structure, which might concern advisers and investors in relation to investor protection until this is clarified by James Hay. The recent bold move by James Hay to reserve the right to apply their FSCS levy costs to individual Sipp accounts could also deter some advisers.
Referring to the creation of James Hay Partnership last month through the merger of James Hay and the IPS Partnership, Bamford concludes: “Merging together two companies will always create a degree of upheaval, so advisers will want to wait a while to make sure service standards are sufficiently good.”
Suitability to market: Good
Adviser remuneration: Average