Would I be better in moving my deferred DC pensions into a SIPP chasing funds where I can reinvest dividends?

[Silvaspoon]

I've a couple of DC pensions which are currently worth about 400k and until recently I haven’t really actively managed and monitored the funds within each pension plan. I’ve only really doing so since 2016. I’ve started looking at SIPPS and different funds and some of these make the same type of growth whilst paying out dividends. This being said it all seems a bit of a minefield for a novice like myself and I'm finding the more I read the more I need to know

I have done some preliminary checks and there are no specials on any of my pensions so I'm thinking I'll not lose that much when moving them - I think they'll have to moved as cash and not in specie but I may be wrong but I'll know when/if it's more viable to move them.

Any thoughts/ideas/advice would be most grateful

Thanks
New to Lemonfool

[tjh290633]

I think that your first step should be to look at the charging structure of the funds in your DC pension. Then look at the potential costs of your proposed SIPP and of the funds, ITs or shares which you might use.

Reinvesting dividends does not come without expense, unless you choose accumulation units.

TJH

[Silvaspoon]

Thanks very much TJH.

Yes I was thinking of accumulation Units. I will need to look at the cost of moving.
Just for info, I will have to move the pots when I want to take my pension

With the current pots,
The 1st pot the cost is very cheap. The downside is that there is much variety in the funds offered.

The 2nd pot there is much variety but the cost associated with these funds is more expensive - SW Series 2

The 3rd pot - these funds are being moved from the Pru series 1 to 3 and I am awaiting information on the charging structure for the larger range of funds in that series

SP

[Alaric]

I think that your first step should be to look at the charging structure of the funds in your DC pension. Then look at the potential costs of your proposed SIPP and of the funds, ITs or shares which you might use.

If you wanted a more hands on approach to managing the funds, a SIPP is going to give you a wider choice. It might even be cheaper, but that's going to depend on platform fees and other charges in the SIPP and the charges in whatever you choose to invest.

Your decision might be easier if the pension schemes are those of your ex-employers rather than your current employer.

[Silvaspoon]

Thanks Alaric,

Yes these are ex-employer schemes and therefore the only thing I'm allowed to do manage the distribution of the pot within each scheme

[JohnB]

A 400k SIPP is likely to cost you £100-200 pa to run with index trackers, more if you are an active investor who likes to deal and chose active funds, on top of the fund fees. It would allow you to make additional contributions which might be better than trying to deal with your current companies scheme. I quickly moved all my old employer schemes, as the index funds I had with them cost much more than the 0.1% standard on the open market.

[xxd09]

It’s a minefield alright
Ive managed my Pension in a SIPP for 18 years and I am still learning especially as the rules constantly change-I am now in Withdrawal mode.
You have to read and educate yourself and really want to do it
Financially it’s worth it but not everybody wants to put in the work
This website is good,try Monevator also
Take a year before you do anything major and learn
Ask questions here
Good luck
xxd09

[Silvaspoon]

Thanks for the advice JohnB and xxd09

JohnB
Thanks for the info on costs etc.

xxd09
Thanks, yes, I'm trying to educate myself so that I'd be able run my pension too - I started looking at this site and am finding it to be very informative I will have a look at Monevator.

SP