James Hay warns of rise in ‘off the page’ SIPPS

James Hay, UK SIPP provider, today warns on the rise of “off the page” SIPPs, following recent research. The research in conjunction with Pensions Management into declared sources of business from registered SIPP providers, shows the rise in direct sale SIPPs. Traditionally SIPPs, the reserve of sophisticated and mass affluent investors, have been recommended through IFAs or other professional intermediaries (solicitors, accountants or wealth managers).

The research shows that one in eight providers does over a quarter of its SIPP business directly with consumers, raising the possibility of a rise in non-advised pensions investment decisions. This reflects the growing commoditisation of the SIPP market, which raises fears that people who don’t need SIPPs are taking them out as a result of aggressive marketing.

Chris Smeaton, Propositions and E-Commerce Manager, James Hay, said, “Concerns remain that people are investing into SIPPs inappropriately. Since A-Day, the rise in commoditised SIPPs has lead to the proliferation of ‘Diet SIPPs’ – SIPPs with low charges offering limited functionality.

“While these can be appropriate for many investors(2), these types of SIPP are frequently sold directly. This raises the possibility that people are investing for their retirement without taking advice from a suitably qualified professional adviser.

“As the largest SIPP provider, over 90 per cent of our business comes through IFAs and professional intermediaries. We would urge investors to seek out professional advice before committing to purchasing a SIPP directly.”

James Hay has over £11 billion assets under management with 38,000 investors.
James Hay SIPP is backed by Grupo Santander, the seventh largest bank in the world. James Hay has won over 22 awards for its SIPP product and service in the last six years.