I’m considering setting up an additional DIY SIPP pension. Do you see an issues with this?

07 July 2021

Question by Mike

I’m 57 and now not working but living off savings while I renovate my house. I will receive a reasonable final salary pension when I’m 60. I’m considering setting up an additional diy SIPP pension and paying in £2880 per year to benefit from the gov top-up of £720 to £3600. Apart from the chance of the funds invested in going down, I can’t see a downside to this investment - can anyone else? Thanks

Answered by

Hi Mike

Thanks for your question. I agree, there is no downside other than potential investment risk, although the tax relief does cushion you a bit so hopefully you loose the taxman's money and not your own.

However, unless you are going to self select direct share investments, you do not need a SIPP. You'll just be paying higher charges for functionality that you're not using. A simple off the shelf pension with Royal London, Aviva or Aegon in a multi asset fund should be fine.

If you need any further information, please contact me or another adviser on the website.

Rachel Efetha