How SIPPs Works

I f you have heard of SIPPs, you likely want to know more about it and if it is the best choice for your personal retirement planning. This pension scheme, which is a UK only scheme, is known as SIPPs or Self-Invested Personal Pensions. As the name suggests, you determine how much you put into it and it does not have an employer matched component. However, you can still choose to have your contributions deducted directly from your pay packet at the beginning of each pay period. The pension is designed for people who want to manage their own funds, giving them the freedom to change around where investments are held with very little hassle. As such, you can choose between government securities, insurance company funds, various trusts, endowment policies, investment in commercial properties, UK or international stocks, and a number of other options as well. Once you have reached the age of 55, you can either choose to begin drawing upon this pension, or you can let it continue to accrue until you feel that you need it. This decision is best made by talking with an investment manager to determine your needs and expenses through retirement.