I want to start a private pension. Is a SIPP right for me or is there a private pension that does the work for you?

07 April 2021

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Question by Amanda

Hi, this may be way too basic a question for your site. I’m completely new to financial planning. I have been working part time since I had my kids, but the last two years I’ve had to give up work to look after my disabled daughter. I’ve been in receipt of carer's allowance, which is taxable income, since she was born, 9 years ago, as well as receiving part time wages. I have a very small occupational pension that I think I could consolidate. I now want to start a private pension and just need to know whether a SIPP is right for me or is there a private pension that does the work for you? I’m looking at pension bee, AJ Bell, Fidelity and Vanguard as possible providers. Thank you.


Answered by Kenny Stevenson

Hi Amanda, a SIPP and a private pension are in essence the same thing, a SIPP can be useful for holding commercial property but for your needs a personal pension is fine.

Yes, there are options where you can have a pension that does the underlying investing for you, in fact most providers will have some form of model portfolio or fund based investing which does the work underneath for you.

It may still be worth setting this up on an advised basis as an adviser will help you to determine what risk level is appropriate, how much to put in and be an access point for the future. This will be particularly helpful if you are considering a consolidation too. Review the pension providers on this site and pick out two or three that match the level of support you would need then contact them to find out more about the service they offer and the costs for it. There is always a balance between low cost and what advice you need so if you are looking for a bit more guidance on what is happening then pick the provider that works for you on that basis.

Answered by

Kenny Stevenson

Financial Planner

Kenny is a Chartered Financial planner and Fellow of The Personal Finance society. He started his career in 2008 in the middle of the Financial Crisis – a baptism of fire some might say but a good experience. He advises a broad range of people; from private clients to business owners and has guided many clients through the journey to retirement. He received the Insurance Society of Edinburgh Award for highest exam grade in Edinburgh at both Diploma and Advanced Diploma levels.