Moving SIPP to ii

[red_slr]

I am considering moving my SIPP to ii.

Does anyone use them? I am a bit confused with their charges. I can see the SIPP charge is £10 a month. But it also says you have a monthly "plan fee". I cant seem to find what that is.

Then how is the account managed? Say I pay in £100 a month does this land as cash and then I have to make a trade (using the free trade?) or is there some way to automatically set up so it buys say for example VLS60 with your £100.

I assume when I transfer it over the current balance will land as cash then I will have to buy what ever allocations I want and pay the appropriate fees.

Any one got any first hand experience?

[Mr Pointy]

I was looking at II as well & it does seem quite complicated. As you say the SIPP is £10 a month & then you have to pick one of the three plans (Investor/Funds Fan/Super Investor) at £9.99/£13.99/19.99 a month. So that's £19.99 a month at least for the SIPP. Each of these has £7.99/mo trading credit.

If you make regular payment transactions these cost £0.99 each, which can come off your trading credit so you can make regular payments into 8 funds a month before you pay any more fees. So you can set up to pay £100 to buy Lifestrategy & £100 to buy Fundsmith every month at no extra cost.

https://www.ii.co.uk/investing-with-ii/regular-inv...

Fees are paid by DD on the 10th of each month. Regular investments sit in your account as cash between the 12th (when the DD is taken) & the third Wednesday of the month.

Edited by Mr Pointy on Sunday 28th July 12:29

[JulianPH]

If I have this right, but on £100 a month you are effectively paying an initial charge of 20% to 30% on every contribution you make (on top of the fees for the underlying investments).

That sounds pretty horrific!

[red_slr]

Obviously pension costs tend to be higher towards the later stages for most people. My SIPP is 20+ years old so £100 was just an example.

One of the reasons I am considering ii is that I plan to stop paying into my SIPP in the next couple of years (but not drawing).

Assuming I have my maths correct I will save about £20k between when I stop paying in and drawing down on my SIPP..

[red_slr]

Mr Pointy said:

I was looking at II as well & it does seem quite complicated. As you say the SIPP is £10 a month & then you have to pick one of the three plans (Investor/Funds Fan/Super Investor) at £9.99/£13.99/19.99 a month. So that's £19.99 a month at least for the SIPP. Each of these has £7.99/mo trading credit.

If you make regular payment transactions these cost £0.99 each, which can come off your trading credit so you can make regular payments into 8 funds a month before you pay any more fees. So you can set up to pay £100 to buy Lifestrategy & £100 to buy Fundsmith every month at no extra cost.

https://www.ii.co.uk/investing-with-ii/regular-inv...

Fees are paid by DD on the 10th of each month. Regular investments sit in your account as cash between the 12th (when the DD is taken) & the third Wednesday of the month.

Edited by Mr Pointy on Sunday 28th July 12:29

Thanks that's some great info.

[Mr Pointy]

JulianPH said:

If I have this right, but on £100 a month you are effectively paying an initial charge of 20% to 30% on every contribution you make (on top of the fees for the underlying investments).

That sounds pretty horrific!

Well you'd have to allow the construct that the monthly charge is not part of the dealing charge & is allocated to account maintenance. If so there's no dealing charge as such as the £0.99 charge is covered by your trading allowance.

In effect the SIPP has an annual charge of £239.88 all up including up to 72 regular investment deals per year.

[JulianPH]

Mr Pointy said:

JulianPH said:

If I have this right, but on £100 a month you are effectively paying an initial charge of 20% to 30% on every contribution you make (on top of the fees for the underlying investments).

That sounds pretty horrific!

Well you'd have to allow the construct that the monthly charge is not part of the dealing charge & is allocated to account maintenance. If so there's no dealing charge as such as the £0.99 charge is covered by your trading allowance.

In effect the SIPP has an annual charge of £239.88 all up including up to 72 regular investment deals per year.

I hadn't factored in any dealing charges, just the SIPP monthly fee and the account/plan fees you stated.

Obviously fees are relative to the overall size of the pot, I was just looking at the £100 a month contribution element.

If there is, just to use a round number, £100,000 in total then depending upon the account/plan selected then the SIPP/platform fee would be between c. 0.24% to 0.36% a year, which is decent value. Obviously there will be the fund costs on top of this.

It is also worth highlighting that there is an additional £10 a month charge (so 0.12% in my example above) when the OP wants to take benefits (even if that is just the tax free lump sum with no income actually being draw down).

So, on the £100k example this is now 0.36% to 0.48% a year (before fund charges), or £360 a year to £480 a year.

I certainly agree that their charges are quite complicated!

Cheers


Edited to change "not" into "now"! )

Edited by JulianPH on Sunday 28th July 14:14