SIPP investors could benefit from an additional safety net by becoming a co-trustee of their pension fund, according to Hornbuckle Mitchell.
The firms claims that investors who become a co-trustee benefit from added protection in the event of their SIPP provider running into financial difficulty, and also have a greater say on how their pension is invested.
Mary Stewart, marketing director at Hornbuckle Mitchell, says most SIPP providers remain the sole owner of a customer's assets, despite the client making all the investment decisions.
"We take the view that the owner of the pension should be allowed to be the owner of its assets," she says. "It sounds obvious but is quite rare in the industry."
By becoming a co-trustee, SIPP investors can appoint a different trustee if their product provider gets into difficulty, Hornbuckle says, and they will be able to recover their assets without having to submit a claim to administrators, which could take months.
"This kind of detail becomes more important when the future of financial companies comes under scrutiny," adds Stewart.
"It is not just the investment performance that needs to be considered, but whether the underlying structure of the scheme has additional security and control built-in."
Becoming a co-trustee also prevents a SIPP provider from blocking any changes to the investment allocation, according to Hornbuckle, even if the provider trustees decide the investment is not in a member's best interests.
Contact: John Bakie, Tel: 020 7484 9805, e-mail: [email protected]IFAonline
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