Self-invested Pension Schemes, otherwise known as SIPPs, were introduced to fill a small gap in the market where a small number of pension investors wanted more control over their pension investments.
Previously, a person going into retirement was obliged to hand over their pension fund to a Life Insurance company in return for an income for life. This was called an annuity. Recently the Government changed the rules and now it is no longer necessary to buy an annuity.
All pension companies charge for their services. However, these can vary dramatically from company to company. We have discovered a number of companies and advisers who charge on-going commission on your pension even though you may not have seen your adviser since you started saving.
FSAVCs or free standing additional voluntary contributions are like a private pension bolted on to your existing occupational pension. In many cases, the best advice would be top up your scheme with in-house AVCs that have lower charges. If you have an FSAVC and would like some advice, contact us today.