Those scrutinising the available products in today’s Sipp market will notice that providers have started to offer wrappers that incorporate multiple savings pots or can provide a full look-through of an individual’s total net worth.
Anthony Carty, group financial planning and business development director at Clifton Asset Management, says innovation is happening and clients are benefiting from more choice than ever before.
“From our own experience, the launch of our Morgan Lloyd Viewpoint Portfolio, gives clients the ability to, not only hold and trade traditional investment assets, but also to include personal bank accounts, and property assets,” he says.
Andrew Gilbert, head of retirement products and proposition at LV=, agrees that providers are beginning to get more creative in the innovations they bring to market.
“We’ve seen some really impressive innovations,” he says.
“Sipp products have emerged that include multi-asset fund blends, or investments that allow full flexibility, or can flex with changing income needs or lifestyle choices during decumulation and take inheritance tax into account.”
Decumulation caution
When it comes to the decumulation phase, product innovation has been slower to arrive.
After the global financial crisis, advisers had initially been wary of retirement products that cost more but offered some form of drawdown guarantee.
So-called ‘third way’ annuities – labelled because they were a third option to annuitisation or income drawdown – were launched into the market during the crisis but they never achieved mass appeal, as advisers were suspicious of the charges and the providers’ use of derivatives to deliver the guaranteed income element.
Fast forward a decade, though, and a new type of Sipp product has been launched.
In February, Just Group announced it had entered a partnership with Novia Financial to offer a guaranteed income product.
At the time, Bill Vasilieff, chief executive officer at Novia said investors increasingly “want a degree of certainty, but do not want to purchase a more restrictive annuity.”
Advisers have recognised the appeal of this type of product, but underscore that it will never become the default for every client.
Adam Wing, financial adviser at UHY Hacker Young, says: “This type of innovation is likely to suit some clients more than others, and people must remember to consider the cost of the Sipp wrapper before undertaking this type of arrangement.”
