Type: Full Sipp
Minimum investment: Lump sum/transfer £1,000, £100 a month, £1,000 a year, lump sum £25,000 for a personal fund
Investment choice: Pinnacle range of 99 funds from 22 fund management groups, customized fund selection including all permitted Sipp investments, commercial property
Options: Discretionary fund management, income withdrawal
Charges: Initial £350, annual 0.25% subject to £36 a month minimum
Additional contributions £50, transfers £75, establishment of income withdrawals, withdrawal admin costs £180 a year, income withdrawal reviews £150, paper-based investment transactions £35 each, panel discretionary manager £250 a year, additional charges for property investments
Commission: Initial up to 5%, fund-based renewal up to 1.4%
Tel: 0117 975 2355
Merchant Investors, has relaunched its self-invested personal pension, having revamped its range of fund links and changed the charging structure to ensure investors only pay for the services they use.
Informed Choice director Martin Bamford regards this a well thought through and comprehensive pension product. “It is good to see a standard commission remuneration option in addition to the typical funded commission option we come to expect from a life assurance company,” he says.
He feels the ability to invest protected rights funds in commercial property is a nice touch, but observes that the novelty factor of this option could wear off if and when protected rights become permitted within Sipps.
Discussing the potential drawbacks Bamford says: “While the initial charge is comparable with trustee Sipps, the annual charge is expressed as a percentage, which would deter higher value pension funds. We would prefer to see explicit charges for all fees associated with self-invested pensions.”
He adds that when Informed Choice establishes Sipps for its clients, it prefers to have them acting as a co-trustee and as a signatory on the trustee bank account. He complains that neither of these options are available through a personalised insurance company fund.
Scanning the market for possible competitors Bamford says: “The Prudential flexible retirement plan also has a self-invested fund option. A full range of trustee and insurance company Sipps will provide the main competition, particularly for investors who are not precious about the self-investment of their protected rights funds.”
He concludes: “While well established in the UK market, and with significant financial backing from South Africa, Merchant Investors remain in my mind as a very niche pension provider. I do not feel that it has acquired brand awareness among UK investors, which could make this recommendation harder to justify in comparison to a mainstream life and pensions provider.”
Suitability to market: Average
Investment choice: Good
Adviser remuneration: Average