Warning over 'inappropriate Sipp investments'
An increasing number of Britons could be saving for retirement with a self invested personal pension (Sipp) that is not appropriate to their financial circumstances, it has been suggested.
James Hay, one of the foremost Sipps providers in the UK, warns that an increasing number of people are investing in a Sipp without having received advice from an independent source.
Indeed, the financial services firm reports that one in eight Sipps providers now attract a quarter of their customers directly, which could leave some people with an inappropriate retirement savings vehicle.
"Since A-Day, the rise in commoditised Sipps has lead to the proliferation of 'Diet Sipps' - Sipps with low charges offering limited functionality," said Chris Smeaton, propositions and e-commerce manager at James Hay.
"While these can be appropriate for many investors, 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."
James Hay suggested recently that so-called deferred Sipps, whereby consumers retain the option of opening a personal pension, are being used by financial services firms to inflate their Sipps' sales figures.
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