Britons using SIPPs to save for retirement

Britons using SIPPs to save for retirement

Britons are often using SIPPs to save up for their retirement as they want more flexibility in how their pensions work. In general, there is a growing awareness that the state pension will not be enough to finance a comfortable retirement, which, along with success of workplace pension auto-enrolment, is encouraging people to take control of their pension prospects, said Rajan Lakhani, a financial expert at Plum. If you're a pension saver, you can choose how much you save and how often you can contribute, or you can contribute a lump sum. The individual can choose which funds they invest in, either by themselves or through a financial advisor.

The key driver of the trend is changes to technology, as people can now manage a SIPP on their own with DIY investment apps, he said. The process of creating a SIPP depends on the provider, he said. s similar to opening up a regular investment account, but there are a few extra steps, he said. As you age, you can choose from a range of funds to invest in based on your risk tolerance.

A person can transfer over other pensions into their SIPP. Lakhani appealed for people to read the terms and conditions and legal information of a SIPP before setting up one. A SIMP retirement can encompass a variety of investments, such as listed or unlisted stocks and shares, gold bullion or commercial property.