23 July 2007
The popularity of self-invested personal pensions (Sipps) is growing as Britons become increasingly aware about the investment option.
Justin Modray of independent advice firm Bestinvest explained that while Sipps used to be “the preserve of the rich”, they are now more accessible.
While more providers are now offering Sipps, charges have dropped “significantly”, according to Mr Modray.
Three years ago annual charges for Sipps would run into hundreds of pounds, which meant they were only cost-effective for investments upwards of £1,000, he explained.
However, now supermarket platforms also offer Sipps, meaning they are “more mainstream”.
Mr Modray said that if an individual has an Isa on a particular platform, it would be “a logical progression” to take out a Sipp on the same platform.
“Supermarkets help to drive down costs,” he commented. “It’s created a lot of competition, but that’s a good thing.”
Pensions Management magazine claims that more than £29 billion is contained in Sipps, with some 244,250 already opened this year.
This is significantly higher than the 148,000 opened in 2006, according to the magazine.
Find out more about self-invested personal pensions