As an alternative to a traditional pension, a self-invested pension plan – or SIPP – offers a wider range of investment opportunities.
With a SIPP, you can invest in a variety of asset classes, from equities and unit trusts to commercial property and gilts. SIPPs allow you to save towards your pension in a tax-efficient manner while enabling you to benefit from more flexibility and personal choice when selecting your investments, although it’s important to note that tax treatment depends on individual circumstances and tax rules can change in the future. However, the costs associated with SIPPs are usually higher than with traditional pensions, and active management is required in order to make full use of their features. Because of this, they will not be suitable for everybody and generally only those who have a good amount of experience in actively managing their investment should consider this type of investment.
In common with many financial products, SIPPs are not the best choice for everyone, but if you have good experience of managing your own investments, you may find them to be an attractive choice for you. We can help you review the options, consider the pros and cons of this course of action, and decide whether selecting a SIPP is a decision you should take.
SIPPs will not be suitable for everybody, as they require investors to be happy in making their own investment decisions and may incur costs not usually associated with other types of pension schemes. Furthermore, it is important to note that as the value of investments can rise and fall, positive returns are more likely if you invest for the long term, but this is not guaranteed and you could get back less than you invest.
The investment growth within the fund is currently free from all UK Income Tax and Capital Gains Taxes.