Starting a SIPP - need basic advice on options...
Discussion
Hello all, basically, I'm looking to take a more "active" role in my own retirement planning.
Situation is thus:
47 years old - higher rate tax payer. would like to retire in ten years...
Pensions:
1. I have a DB pension from an old employer - this is, by my standards at least, the " big one "; 12+ years at (I think) 1/50th accrual rate.
According to the scheme administrators portal/site, this is currently worth ~ £1,000/month with retirement age of 57, I have no idea what that makes the pot worth, but I guess £250-300K ?, though it's largely irrelevant since DB pensions are (as I understand it) extremely hard to extract / move / combine / generally f
k with...? I see this one as staying put, and I guess both the pot, and thus the monthly, will continue to grow until crystallised ...?
2. I am also making maximum contributions into my current employer's DC scheme - with their matched contributions this is 22% of my gross in aggregate. On top of this, CURRENTLY, I am, for obvious reasons, ploughing all earnings above £50K into the employer pension via AVCs, and with bonus, all being well this can be as much as £35-45K/annum.
3 & 4 - I also have two other DC schemes which are not worth a lot since they are the product of contributions from two fairly short ( 1 and 2-year) periods of employment. One of these pot's values (Aviva) has gone down three years out of the last four, and the other (People's Pension) is treading water. These two small pots combined are probably worth £12K, so not much...
With Rachel from Accounts plans to remove much of the incentive / benefit to save for one's retirement in a couple or three years, I plan to keep on ploughing as much in whilst their is maximum benefit to be had from so doing... I see this as making more sense than paying down mortgage capital - am I right? - I am getting 40% relief on £40K/annum instead of paying down debt which attracts about 4% interest?
What I would like to do is combine / roll the Aviva and PP pots into one SIPP. I would then like to consider making the additional contributions I am making into my present employer DC scheme into my new SIPP too. meaning I could have, say a £12K starting point, and then £35K+/annum in ongoing annual contributions, and still 22% going into my current employer DC scheme.
Problem is, whilst I consider myself fairly financially savvy, I don't know where to start with the above approach - I am sure there is a very competitive marketplace for the kind of SIPP platform I am looking for, and I guess fees are much of a muchness, though are (from what I read on here...) still a factor and not to be disregarded.
What is the first step here? - do I just call AJ Bell / HL / ii and tell them I want to open a SIPP and transfer the two small DC pots into it, and go from there? would they contact Aviva / PP for me?
Once the SIPP is up-and-running, I would like to take a more active approach to choosing the investments (but I doubt I will be particularly brave....) - How do I know which provider will have the lowest fees for a particular (say) global equities tracking fund?
As an aside, I may well be interested in buying commercial property as part of a SIPP (mainly to avail myself of roll-over relief on CGT on a planned disposal...) do the above sort of SIPP providers entertain holding CommProp in a SIPP, or do I need specialist provider?
Sorry for all the questions, but I feel like PH is usually the best place to start....
Thanks in advance all.
Situation is thus:
47 years old - higher rate tax payer. would like to retire in ten years...
Pensions:
1. I have a DB pension from an old employer - this is, by my standards at least, the " big one "; 12+ years at (I think) 1/50th accrual rate.
According to the scheme administrators portal/site, this is currently worth ~ £1,000/month with retirement age of 57, I have no idea what that makes the pot worth, but I guess £250-300K ?, though it's largely irrelevant since DB pensions are (as I understand it) extremely hard to extract / move / combine / generally f
k with...? I see this one as staying put, and I guess both the pot, and thus the monthly, will continue to grow until crystallised ...?2. I am also making maximum contributions into my current employer's DC scheme - with their matched contributions this is 22% of my gross in aggregate. On top of this, CURRENTLY, I am, for obvious reasons, ploughing all earnings above £50K into the employer pension via AVCs, and with bonus, all being well this can be as much as £35-45K/annum.
3 & 4 - I also have two other DC schemes which are not worth a lot since they are the product of contributions from two fairly short ( 1 and 2-year) periods of employment. One of these pot's values (Aviva) has gone down three years out of the last four, and the other (People's Pension) is treading water. These two small pots combined are probably worth £12K, so not much...
With Rachel from Accounts plans to remove much of the incentive / benefit to save for one's retirement in a couple or three years, I plan to keep on ploughing as much in whilst their is maximum benefit to be had from so doing... I see this as making more sense than paying down mortgage capital - am I right? - I am getting 40% relief on £40K/annum instead of paying down debt which attracts about 4% interest?
What I would like to do is combine / roll the Aviva and PP pots into one SIPP. I would then like to consider making the additional contributions I am making into my present employer DC scheme into my new SIPP too. meaning I could have, say a £12K starting point, and then £35K+/annum in ongoing annual contributions, and still 22% going into my current employer DC scheme.
Problem is, whilst I consider myself fairly financially savvy, I don't know where to start with the above approach - I am sure there is a very competitive marketplace for the kind of SIPP platform I am looking for, and I guess fees are much of a muchness, though are (from what I read on here...) still a factor and not to be disregarded.
What is the first step here? - do I just call AJ Bell / HL / ii and tell them I want to open a SIPP and transfer the two small DC pots into it, and go from there? would they contact Aviva / PP for me?
Once the SIPP is up-and-running, I would like to take a more active approach to choosing the investments (but I doubt I will be particularly brave....) - How do I know which provider will have the lowest fees for a particular (say) global equities tracking fund?
As an aside, I may well be interested in buying commercial property as part of a SIPP (mainly to avail myself of roll-over relief on CGT on a planned disposal...) do the above sort of SIPP providers entertain holding CommProp in a SIPP, or do I need specialist provider?
Sorry for all the questions, but I feel like PH is usually the best place to start....
Thanks in advance all.
You're doing all the right stuff imo, especially if you are getting effective tax relief of 42% (inc NI savings) on the AVCs.
I've moved old employer DC pension pots from Aviva to H-L a couple of times, initiated by H-L online and it has only taken a couple of weeks or so with no need to even speak to Aviva, or in fact anyone.
Due to the fee cap for anything exchange traded I don't even think their fees are that bad at all if you have a reasonable sized pot invested just in ETFs and Investment Trusts it makes a lot of sense, and no fees for drawing down.
I've moved old employer DC pension pots from Aviva to H-L a couple of times, initiated by H-L online and it has only taken a couple of weeks or so with no need to even speak to Aviva, or in fact anyone.
Due to the fee cap for anything exchange traded I don't even think their fees are that bad at all if you have a reasonable sized pot invested just in ETFs and Investment Trusts it makes a lot of sense, and no fees for drawing down.
My suggestion would be to open a sipp with Interactive Investor
https://www.ii.co.uk/ii-accounts/sipp/sipp-charges
I like it because it's £12.99 pm, regardless of pot size. As It's a SIPP I am not jumping in and out of funds/stocks (ie trading) on a regular basis, so it works well for me.
You can start here https://www.ii.co.uk/ii-accounts/sipp/transfer-my-... and that should help you start up a SIPP and begin the transfer of any existing pension(s) into it. (Obviously, you will need details of those existing pensions).
Re: Commercial Property - I believe currently you cannot buy commercial property, but you can hold REIT funds. (this might have changed so I would suggest you speak directly with ii to confirm)
https://www.ii.co.uk/help/investment-accounts/sipp...
I went through the process of consolidating other pots into my ii sipp several years ago - it was a painless process (a lot of that will depend on the scheme administrator).
When I retire I'll also move my Aviva work pension into my ii SIPP, to save platform fees.
Before transferring any old Pension check that they aren't age protected, you may be able to get access to it from age 55 instead of 57 (in 2028).
My wife has a current Aviva workplace DC pension she started in 2019 and it is age protected at 55 so we are funding it more heavily than before (via work payment (her work only contribute the minimum) and separate payments into it via debit card).
Her SIPP with Vanguard will be accessed later as that's from 57 (maybe even 58/59 if the goalposts get moved! She is 46).
My wife has a current Aviva workplace DC pension she started in 2019 and it is age protected at 55 so we are funding it more heavily than before (via work payment (her work only contribute the minimum) and separate payments into it via debit card).
Her SIPP with Vanguard will be accessed later as that's from 57 (maybe even 58/59 if the goalposts get moved! She is 46).
ukwill said:
My suggestion would be to open a sipp with Interactive Investor
https://www.ii.co.uk/ii-accounts/sipp/sipp-charges
I like it because it's £12.99 pm, regardless of pot size. As It's a SIPP I am not jumping in and out of funds/stocks (ie trading) on a regular basis, so it works well for me.
II fees are changing in Feb I believe - and in some cases would be cheaper - https://www.ii.co.uk/our-charges/new-pricinghttps://www.ii.co.uk/ii-accounts/sipp/sipp-charges
I like it because it's £12.99 pm, regardless of pot size. As It's a SIPP I am not jumping in and out of funds/stocks (ie trading) on a regular basis, so it works well for me.
It looks like both my wife & I will be paying less.
ETA: I've been with II.com for a good few years and can recommend them.
Edited by Chris Type R on Tuesday 6th January 19:47
duckson said:
Before transferring any old Pension check that they aren't age protected, you may be able to get access to it from age 55 instead of 57 (in 2028).
My wife has a current Aviva workplace DC pension she started in 2019 and it is age protected at 55 so we are funding it more heavily than before (via work payment (her work only contribute the minimum) and separate payments into it via debit card).
Her SIPP with Vanguard will be accessed later as that's from 57 (maybe even 58/59 if the goalposts get moved! She is 46).
This is interesting - and not something I even knew was a thing - "being able to still get to it at 55" - I though that was law...? Not that I am doubting you at all.My wife has a current Aviva workplace DC pension she started in 2019 and it is age protected at 55 so we are funding it more heavily than before (via work payment (her work only contribute the minimum) and separate payments into it via debit card).
Her SIPP with Vanguard will be accessed later as that's from 57 (maybe even 58/59 if the goalposts get moved! She is 46).
My Aviva pension is the smallest of the lot I think, but from what you and Butchstewie say this shouldn't necessarily be relevent, because I can boost it?
Maybe the sensible thing to do would be to transfer the PP into the Aviva scheme and then do a mixture of boosting that and a new SIPP, albeit the SIPP now starting from £Zero, but that wouldn't matter much with the level of contributions I am anticipating being able to make...
Thanks to you both (I don't know how to quote multiple people in reply...
Read this 
https://www.aviva.co.uk/retirement/pension-basics/...
Obviously confirm everything specific to yourself with Aviva.
https://www.aviva.co.uk/retirement/pension-basics/...
Obviously confirm everything specific to yourself with Aviva.
NicoG said:
This is interesting - and not something I even knew was a thing - "being able to still get to it at 55" - I though that was law...? Not that I am doubting you at all.
My Aviva pension is the smallest of the lot I think, but from what you and Butchstewie say this shouldn't necessarily be relevent, because I can boost it?
Maybe the sensible thing to do would be to transfer the PP into the Aviva scheme and then do a mixture of boosting that and a new SIPP, albeit the SIPP now starting from £Zero, but that wouldn't matter much with the level of contributions I am anticipating being able to make...
Thanks to you both (I don't know how to quote multiple people in reply...
You may find Aviva to be more expensive to keep your pot than somewhere like ii. I know it is more expensive for me to keep my workplace pension there.My Aviva pension is the smallest of the lot I think, but from what you and Butchstewie say this shouldn't necessarily be relevent, because I can boost it?
Maybe the sensible thing to do would be to transfer the PP into the Aviva scheme and then do a mixture of boosting that and a new SIPP, albeit the SIPP now starting from £Zero, but that wouldn't matter much with the level of contributions I am anticipating being able to make...
Thanks to you both (I don't know how to quote multiple people in reply...
Chris Type R said:
II fees are changing in Feb I believe - and in some cases would be cheaper - https://www.ii.co.uk/our-charges/new-pricing
It looks like both my wife & I will be paying less.
ETA: I've been with II.com for a good few years and can recommend them.
Thanks for the link. That means mines gone up £2 pm. Which is more than fine considering what HL was charging me years ago.It looks like both my wife & I will be paying less.
ETA: I've been with II.com for a good few years and can recommend them.
Edited by Chris Type R on Tuesday 6th January 19:47
Can a SIPP be started with just a lump sum, without any initial monthly contributions, but maybe start regular contributions at a later date?
I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
Edited by The Gauge on Wednesday 1st April 10:09
The Gauge said:
Can a SIPP be started with just a lump sum, without any initial monthly contributions, but maybe start regular contributions at a later date?
I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
I'd say 'yes' - and ideally open this this week to be in the 25/26 tax year. You should be able to open with £60k. Opening this week adds a carry over allowance. I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
Edited by The Gauge on Wednesday 1st April 10:09
Chris Type R said:
The Gauge said:
Can a SIPP be started with just a lump sum, without any initial monthly contributions, but maybe start regular contributions at a later date?
I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
I'd say 'yes' - and ideally open this this week to be in the 25/26 tax year. You should be able to open with £60k. Opening this week adds a carry over allowance. I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
Edited by The Gauge on Wednesday 1st April 10:09
Good shout above about doing it NOW in 25/26 tax year ..... if not the amount
PM3 said:
Chris Type R said:
The Gauge said:
Can a SIPP be started with just a lump sum, without any initial monthly contributions, but maybe start regular contributions at a later date?
I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
I'd say 'yes' - and ideally open this this week to be in the 25/26 tax year. You should be able to open with £60k. Opening this week adds a carry over allowance. I fancy starting one for my 19yr old son, maybe chucking £12k into it whilst he's young. (he earns £12k). Can he then add to it at a later date?
(He's on an apprenticeship wage (less than minimum wage) and his employer are hopefully putting him into their Aviva employers pension when his wage rises).
I don't think I can backdate any previous years allowances as he isn't currently in a pension scheme. But could I start one for him now with just a lump sum, and forget about it for a while?
Edited by The Gauge on Wednesday 1st April 10:09
Good shout above about doing it NOW in 25/26 tax year ..... if not the amount
> Tax relief is limited to relief on contributions up to the higher of:
> 100% of your UK taxable earnings
> £3,600
@The Gauge - I've messaged you a referral link for ii.com which I use (and recommend), and this saves a bit of money.
I think I can only deposit up to his annual salary (£12k).
I wont be able to carry over any previous years allowances as I think that only applies for previous years when he was in pension scheme, and he hasn't been in one yet.
Not sure if I will get the funds together in time for this years allowance, they are in Premium Bonds and they wont be cashed in in time, considering the Bank Holidays over this weekend.
But is certainly something to do for the next financial year.
For his LISA I chose a Vanguard Global All Cap Index, and I may do the same for his SIPP next year.
I wont be able to carry over any previous years allowances as I think that only applies for previous years when he was in pension scheme, and he hasn't been in one yet.
Not sure if I will get the funds together in time for this years allowance, they are in Premium Bonds and they wont be cashed in in time, considering the Bank Holidays over this weekend.
But is certainly something to do for the next financial year.
For his LISA I chose a Vanguard Global All Cap Index, and I may do the same for his SIPP next year.
Edited by The Gauge on Wednesday 1st April 13:45
If a SIPP is opened right now with, say, £100 there are rules for carrying forward pension contributions. The main factor is likely to be his earnings in 2026/27.
Current Year First: You must fully use your annual allowance for the current tax year (e.g., £60,000 for 2025/26) before tapping into previous years' unused allowances.
Three-Year Limit: You can utilize unused allowances from the three previous tax years, starting with the earliest year first.
Membership Requirement: You must have been a member of a registered pension scheme during the years you are carrying forward from, even if you made no contributions.
Earnings Limit: Your total personal contributions (including carry forward) cannot exceed 100% of your earnings in the current tax year.
No Reporting Needed: You do not need to report to HMRC if you are within the limits, but you must keep records.
Current Year First: You must fully use your annual allowance for the current tax year (e.g., £60,000 for 2025/26) before tapping into previous years' unused allowances.
Three-Year Limit: You can utilize unused allowances from the three previous tax years, starting with the earliest year first.
Membership Requirement: You must have been a member of a registered pension scheme during the years you are carrying forward from, even if you made no contributions.
Earnings Limit: Your total personal contributions (including carry forward) cannot exceed 100% of your earnings in the current tax year.
No Reporting Needed: You do not need to report to HMRC if you are within the limits, but you must keep records.
Thank you for the info
So if I open a SIPP now with £100, I can add top it up next year using the carry forward rule? Is the fact he isn't currently in any pension relevant?
His employers pension won't start until later in April 2026, so he doesn't have a pension at all yet.
I won't get any lump sum funds liquid in time to be able to pay into a SIPP for this year, but I can do it with say £100 if the carry forward rules allow me to backdate a top up.
Also, once his employers pension is set up, will I have to find out how much he pays in each year to work out how much can be paid into his SIPP for next year?
Say his wage goes up to £15k, and he starts paying £1k annually into an employer's pension, does that mean I can put £11,200 (maximum to get full tax relief) into a SIPP for him for that year?
So if I open a SIPP now with £100, I can add top it up next year using the carry forward rule? Is the fact he isn't currently in any pension relevant?
His employers pension won't start until later in April 2026, so he doesn't have a pension at all yet.
I won't get any lump sum funds liquid in time to be able to pay into a SIPP for this year, but I can do it with say £100 if the carry forward rules allow me to backdate a top up.
Also, once his employers pension is set up, will I have to find out how much he pays in each year to work out how much can be paid into his SIPP for next year?
Say his wage goes up to £15k, and he starts paying £1k annually into an employer's pension, does that mean I can put £11,200 (maximum to get full tax relief) into a SIPP for him for that year?
Edited by The Gauge on Wednesday 1st April 18:13
Chris Type R said:
Once you open the SIPP he has a pension (Self-Invested Personal Pension).
Understood, thanks. So with a SIPP opened this year (today) with just a £500 one off contribution, could that be topped up sometime next year and still count for tax relief for this year? Can previous years unused allowances be retrospectively carried over into the following year? or does 5th April close all doors for that years benefits?
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