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Sipp Spotlight: Standard Life under the lens

We examine the features of Standard Life’s Wrap Sipp, which gives access to risk-rated funds on its platform.

Business information

Number of Sipps 152,800

Total Sipp assets £19 billion

Average size of individual Sipp £125,000

Profit for latest financial year for which figures are available £346 million

Turnover for latest financial year for which figures are available £9.1 billion

Capital held in excess of regulatory requirement £3.1 billion

Who are the owners of the business?

Standard Life, which is listed on the London Stock Exchange and has around 1.5 million individual shareholders.

Available investments

• Quoted equities

• Exchange traded funds

• Futures and options

• Hedge funds

• Trustee investment plans

• Discretionary fund managers

• Open market deposit accounts

• Commercial property

• Offshore investment bonds

• Real estate investment trusts

• Unregulated collective investment schemes

How many funds can Sipp investors choose from?

• Wrap Sipp:

2,500 mutual funds

Charges

Establishment £339*

Annual administration £466*

* Waived if the client is 100% invested with Standard Life Wealth

Platform funds

Product charge 0.6% per annum

Wrap fund-based administration rebates

A scale from 0% for less than £100,000 to 0.35% for over £1 million

Fund manager rebates paid to client’s Sipp bank account or added as units for insured pension funds

Contributions

Cash nil

In specie £265

Drawdown

Flexible drawdown set-up charge £200 (waived until January 2013)

Flexible drawdown early depletion charge £300 (if below £20,000 in first three years)

Investment transaction charges £56 per transaction (capped at £350 a year)

Listed securities £11 per transaction (capped at £350 a year)

Property

Set-up charge £728

Administration charge £224

VAT administration charge £124

Mortgage administration charge £167

Sale charge £617

Syndicated properties£51 per member

(two to five members);

£102 per member (six or more)

Other features

Group Sipp Yes

Scheme pension No

Drawdown, flexible drawdown, capped drawdown, phased drawdown Yes

Phased retirement Yes

Platform links

Wrap Sipp sits on Standard Life’s Wrap platform.

Adrian Murphy

Associate partner, Murphy Financial

We use the Standard Life Wrap Sipp for any of our clients with £100,000 to £500,000 of assets. We do use other Sipps on a different platform but the Wrap Sipp is where the majority of our business goes.

We use the Nucleus platform Sipp for clients who, although using the platform to invest in collectives, are likely to need to go off-platform with some of their Sipp investments, for example an external discretionary manager to direct property investment. We also use this Sipp for our higher net-worth clients.

Straightforward needs

However, Standard Life sits nicely for the segment of clients we know will have more straightforward needs.

They use the MyFolio funds, which have had relatively low management charges, although they are a couple of basis points more expensive in that multi-manager asset space. The funds also come out well in terms of performance.

Commercial property can become expensive however: charges add up. But the clients we put in the Wrap Sipp are unlikely to need it.

We have around £30 million on the Standard Life platform and around 50% to 60% of that is Sipp assets. We have been using it for five years.

Several Sipp clients qualify for discounts because of the volume of assets they hold on the wrap.