RDR raises the bar for Sipp providers

Advisers want flexibility, a high standard of service, prompt access to management information and value for money from Sipps, in response to the demands of the post-2012 era.

Advisers are demanding even more from their Sipp wrappers as the retail distribution review (RDR) emphasises the need for IFAs to look at a wider universe of investments.

A report by Defaqto found half of advisers prefer Sipps which permit full flexibility of investment choice versus those offering a more structured approach. This compared with just 10% who preferred Sipps which provide structured links to investment services.

Cheap and flexible

Phillip Owen, managing director of London-based RPG Wealth Management (pictured), said cost and flexibility are the two major issues to consider when choosing a Sipp for a client.

‘Open architecture is important, but it’s down to whether the adviser is trying to manage the portfolio himself or simply outsource it. I’m looking for a very simple, cost effective wrapper to be able to bring in my investment model,’ he said.

For Owen this means offering access to external investments, but not necessarily providing an exhaustive list of potential stocks and funds.

‘I’m not fussed whether there’s access to AIM-listed stocks or some odd investments. My model is very simple. I would be concerned, though, if it was a quasi-Sipp with no full access to third parties, as have been offered by some insurance companies. They call it a Sipp but it’s more of a platform.’

Owen uses Sippcentre from A J Bell as a wrapper and then outsources investment.