Are there any low cost providers who accept SIPPs in drawdown?

I am 70 but - apart from the tax free content - have not yet drawn down on my SIPP. My current adviser charges 2% per annum which will be a noticeable chunk of my future income so I am thinking of transferring to a lower cost provider. It seems the robo-investors don't accept SIPPs in drawdown and I don't want to advise myself. Are there low cost providers who accept SIPPs in drawdown?

Hi Charles

There are certainly lower-cost providers who accept SIPPs in drawdown, with Netwealth being one example.

Most pension schemes should, in fact, be able to accept transfers-in from SIPPs that are in drawdown, although once a pension is in drawdown, it can no longer be transferred partially. You will therefore have to transfer the SIPP in its entirety if you do decide to move.

You are right to look carefully at the level of fees you are paying and 2% per annum is certainly an expensive annual cost, even higher than the industry average of 1.9% a year, according to FCA research that you can read here: https://www.fca.org.uk/publication/corporate/evaluation-of-the-impact-of-the-rdr-and-famr.pdf

This fee is also significantly higher than that which you would pay at a modern wealth manager like Netwealth. Assuming a pension value of £500k, and a medium level of risk, a fully managed Netwealth pension portfolio currently costs 0.57% per annum if financial planning advice is included. This fee includes the Netwealth management fees, underlying fund costs, a pension annual charge, and costs of trading. Should you wish to take financial advice, it is also available and can be paid for by the hour, or annually, depending on your needs.

Should you have any questions, or if you would like to discuss further, please let me know.

Best regards,
Tom