Question
I've got ISA (FundsNetwork/Cofunds) and a SIPP (FundsNetwork/Std Life - £100k) through BestInvest and a SIPP (ex Prot Rights - £50k) with HL. Didn't want to put everything in one pot! I've received a letter from BI saying that from 15/04 following RDR, Std Life has decided not to deal execution only or with self directed clients such as BI.
BI has been making me aware of their Select SIPP / ISA offerings - it looks too good to be true - and there must be some negatives to balance the positives when comparing FN with the Select products - possibly some of the charges outlined here: http://www.candidmoney.com/articles/268/beware-fund-platform-exit-charges
I've been with BI for many years and do like their approach /research. HL is OK, but I've had to move out of trackers to avoid platform charges. I only hold funds.
What do I do with my SIPPs? Just stay with FN without BI? Merge them both in the BI Select SIPP? Move one or more to another provider and forgo the research and guidance BI provides to build a balanced portfolio? It would be great if there was a website that allowed asset allocation, geo split etc to be defined and then from a list of user specified funds it would say "You can achieve this by X% of fund Y " but I've not found any. Answer
In general the Bestinvest Select SIPP costs less overall than Hargreaves Lansdown (HL) Vantage SIPP for a typical portfolio, although this does obviously depend on the specific funds held and amounts involved. This is thanks to Bestinvest giving, on average, slightly higher trail commission rebates than HL (as well as lower share dealing charges)..
Unfortunately, I can't include HL on my comparefundplatforms website as they refuse to send me the required data (including rebate percentages for each fund), otherwise it would be very easy for you run a quick comparison based on the investments you hold.
The main difference between the Bestinvest Select SIPP and FundsNetwork SIPP via Bestinvest is trail commission rebates, Bestinvest pays them on its SIPP but not FudnssNetwork's. But you're right to point out that exit charges on the Bestinvest SIPP are usually higher than FundsNetwork's if you want to transfer funds 'as is' to another platform in future.
If there's a flaw with the Bestinvest Select SIPP it's simply that there are lower cost SIPPs in the marketplace, especially if you hold funds. For example, Interactive Investor, Sippdeal and Alliance Trust Savings should all likely prove cheaper in your scenario. However, none of these companies has independent research or tools to match Bestinvest's, so it's a case of judging whether such factors are worth the extra cost.
The usual rationale for splitting a SIPP between more than one provider is to ensure greater coverage under the Financial Services Compensation Scheme (FSCS), which only provides up to £50,000 cover per provider (although underlying investments might be separately covered). However, given your SIPP monies are ring-fenced from the provider itself the main risk is fraud, which is unlikely. So I wouldn't lose too much sleep over combining both pots with one reputable provider.
Your asset allocation website is a good idea and certainly possible. I hope one day to put something together along those lines, but since it requires buying in a lot of expensive data (i.e. fund holdings) and would take a considerable amount of my time to build I'm afraid it'll likely remain on the backburner for some time yet.
I've got ISA (FundsNetwork/Cofunds) and a SIPP (FundsNetwork/Std Life - £100k) through BestInvest and a SIPP (ex Prot Rights - £50k) with HL. Didn't want to put everything in one pot! I've received a letter from BI saying that from 15/04 following RDR, Std Life has decided not to deal execution only or with self directed clients such as BI.
BI has been making me aware of their Select SIPP / ISA offerings - it looks too good to be true - and there must be some negatives to balance the positives when comparing FN with the Select products - possibly some of the charges outlined here: http://www.candidmoney.com/articles/268/beware-fund-platform-exit-charges
I've been with BI for many years and do like their approach /research. HL is OK, but I've had to move out of trackers to avoid platform charges. I only hold funds.
What do I do with my SIPPs? Just stay with FN without BI? Merge them both in the BI Select SIPP? Move one or more to another provider and forgo the research and guidance BI provides to build a balanced portfolio? It would be great if there was a website that allowed asset allocation, geo split etc to be defined and then from a list of user specified funds it would say "You can achieve this by X% of fund Y " but I've not found any. Answer
In general the Bestinvest Select SIPP costs less overall than Hargreaves Lansdown (HL) Vantage SIPP for a typical portfolio, although this does obviously depend on the specific funds held and amounts involved. This is thanks to Bestinvest giving, on average, slightly higher trail commission rebates than HL (as well as lower share dealing charges)..
Unfortunately, I can't include HL on my comparefundplatforms website as they refuse to send me the required data (including rebate percentages for each fund), otherwise it would be very easy for you run a quick comparison based on the investments you hold.
The main difference between the Bestinvest Select SIPP and FundsNetwork SIPP via Bestinvest is trail commission rebates, Bestinvest pays them on its SIPP but not FudnssNetwork's. But you're right to point out that exit charges on the Bestinvest SIPP are usually higher than FundsNetwork's if you want to transfer funds 'as is' to another platform in future.
If there's a flaw with the Bestinvest Select SIPP it's simply that there are lower cost SIPPs in the marketplace, especially if you hold funds. For example, Interactive Investor, Sippdeal and Alliance Trust Savings should all likely prove cheaper in your scenario. However, none of these companies has independent research or tools to match Bestinvest's, so it's a case of judging whether such factors are worth the extra cost.
The usual rationale for splitting a SIPP between more than one provider is to ensure greater coverage under the Financial Services Compensation Scheme (FSCS), which only provides up to £50,000 cover per provider (although underlying investments might be separately covered). However, given your SIPP monies are ring-fenced from the provider itself the main risk is fraud, which is unlikely. So I wouldn't lose too much sleep over combining both pots with one reputable provider.
Your asset allocation website is a good idea and certainly possible. I hope one day to put something together along those lines, but since it requires buying in a lot of expensive data (i.e. fund holdings) and would take a considerable amount of my time to build I'm afraid it'll likely remain on the backburner for some time yet.
Read this Q and A at http://www.candidmoney.com/askjustin/870/shold-i-use-bestinvest-select-sipp-or-other
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