With a SIPP in drawdown would a company like Netw

06 May 2021

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Question by Steve

With a SIPP in drawdown would a company like Netwealth whose investment management fees are of the order of .66% of the value of the portfolio, be a better option compared to companies like Hargreaves Lansdown or Investec? What are the relative benefits of Netwealth over the more traditional wealth managers?

Answered by Helena Wardle

Good question.

When you are comparing charges of providers it is important to look at your objectives and think about whether the provider can facilitate them.

Consider what facilities you need and want and if you are prepared to pay extra to have those.

You are mentioning a SIPP in drawdown, so I take it that you are drawing on your pension?

There's therefore a few factors that you need to think of when assessing which provider is best for you;

  • How often do you need to withdraw from the pension?

  • Will it be regular withdrawals or as and when?

  • Have you already drawn tax free cash or will it be more efficient for you to take the tax free cash in stages?

  • Do you need a fund manager to help you decide on how to invest the funds within your pension? Or are you happy to research and make your own investment decisions?

  • Can these providers facilitate your pension needs in the way that you would ideally like, and if not, are you prepared to compromise to work within what their pension contract would allow?

It is worth looking at and comparing the drawdown facilities of the providers you have in mind, in addition to the investment funds.

It is also important to consider if what you are taking from your pension is sustainable to ensure your pension doesn’t run out before you!

Answered by

Helena Wardle

Chartered Financial Planner

I am passionate about helping people get more clarity, confidence and reassurance with their money matters. I feel it is important to understand our client’s stories and to help connect their money with what matters to them.