Self Invested Personal Pension Schemes

Back in days long gone, one’s only option for retirement savings was to hand off the responsibility to those we call the professionals, and pay them hefty sums for the privilege. In the nineties however, Self invested personal pension schemes started to flood the market. And they have gained recognition for the flexibility and a certain level of independence that they offer to the small businesses especially. What more, it has become easier to use as time goes by. Most people use SIPPs in combination with a company pension which allows the saver to maximize employer contributions while keeping a separate pot with greater freedom for self management.

What is SIPP

Self Invested Personal Pension abbreviated SIPP is a personal pension scheme that’s been approved by the government of the United Kingdom. Acting as a sort of a ‘wrapper’ for pension investments, SIPP allows investors to have the freedom to use a wider range of investments and products in order to grow their pension fund. SIPP can offer up to 45% tax relief on contributions and no capital gains tax or additional income tax to pay in the UK.  Apart from the tax relief advantage, SIPPs can offer a wide range of investments which an investor can choose from variety of sources even those overseas. The opportunity presented by investments in a SIPP has meant that a lot of people get advised by financial products company to transfer their pensions into a SIPP some of which results in mis-sells. It has also presented some opportunities for scammers to make a lot of hay on the backs of ill-informed consumers.

How does it work

So how is this SIPP differ from standard personal pension schemes? Well, with standard personal pension schemes, it is others who manage your investments for you within the pooled fund you choose to work with. SIPPs on the other hand, gives you the freedom to choose and manage your own investments. Of course even within the SIPP system, you can still pay an authorized investment manager to make the investment decisions on your behalf. By design, SIPP allows you to manage your own funds by dealing with and when you need to, switch your investments when you have to. With all its advantages, SIPPs usually has higher charges than other personal pensions and because of this reason, SIPPs are considered more suitable for large funds or very experience investors. And for self-employed and those with inadequate pension schemes, SIPP presents a better alternative for retirement savings.

A great tool to help consumers gain control of their investments, mis-sells has plagued the industry over the years resulting in thousands of people making daily complaints and trying to make claims to recover their monies. Goodwin Barrett has extensive experience helping such investors claim back their losses from a wide range of these individual SIPP investment schemes. You can find out more about them from their website on GoodwinBarrett.co.uk. They will be at your service promptly.