In the latest of our ‘In the Spotlight’ articles we catch up with Nigel Bennett, Sales & Marketing Director at InvestAcc.
Investment Sense:
InvestAcc have been offering self-invested pensions for almost 20 years now, but it’s probably fair to say that you are not the most high profile of SIPP providers, can you start by telling us a bit more about InvestAcc’s history?
Nigel Bennett (right):
We started in 1992, primarily serving the retirement planning needs of local business owners who were often looking to utilise their pension funds more effectively. We were working from a small office in the Lake District, but relocated to Carlisle when we were in need of larger premises and more people to join our expanding team. We launched our first SIPP in 2003, and since then our customer base has increased steadily through referrals from advisers around the UK.
We have just reached our 3,000th active SIPP and was recently named Best SIPP Provider in the Investment Life & Pensions Moneyfacts Awards 2016. We believe this is because we offer a competitive and straightforward fee structure, whilst putting customer service at the heart of our business.
Investment Sense:
You have two SIPP products; can you explain the key differences?
Nigel Bennett:
The Minerva SIPP is our original full SIPP product – it allows a large range of investments, including purchase and development of commercial property and land with very low charges.
SIPP Lite is an even lower cost product. This allows one simple investment – an investment platform, Stockbroker account, Discretionary Fund Manager (DFM) account, Structured Product, Insurance Company Trustee Investment Bond or a deposit account – in addition to the default SIPP bank account. It can be upgraded to the full Minerva SIPP at any time, without charge.
Investment Sense:
So why did you decide to launch SIPP Lite? What gap does it fill?
Nigel Bennett:
We recognised that many of our new SIPPs were simpler to administer because they were invested in just one place. Behind the scenes, the client may actually be investing across lots of different assets or fund managers, for example, but if we’re only dealing with one “investment account” the reduced administration burden meant that we could charge less and still deliver great service. It fills the gap between full SIPP and less flexible pensions.
Investment Sense:
What are the key reasons why IFAs recommend InvestAcc to their clients?
Nigel Bennett:
First and foremost, it is the service we offer, followed closely by our very competitive charges, straightforward approach, and the fact that we’re very easy to deal with. Apparently that is not as common as it should be.
Also, with the capital adequacy rules now firmly in place, advisers and their clients are looking for that extra security and knowledge that the provider chosen at the end of what is naturally a hefty due diligence process will survive for the long term in a crowded and competitive marketplace.
Investment Sense:
You are one of the few SIPPs that allows joint venture purchase of commercial property, meaning that you will allow the SIPP to own a share of the property, with someone else owning the rest, why is this the case?
Nigel Bennett:
It is important to be clear here. When we talk about joint ventures, we mean property owned partly by another party, usually the client or their business. We don’t allow syndicated property purchase, where someone markets an “investment opportunity” to invest in a share of a large property. The type of joint venture we allow can be particularly useful where there is a shortfall in funding, preventing the SIPP from affording 100% of the property. Often joint ventures are short term in nature, although not always. We believe this sort of transaction is perfectly acceptable so long as it is properly documented and done on commercial terms.
Investment Sense:
Are there any future developments at InvestAcc you can share with us?
Nigel Bennett:
In the past 12 months we have developed a range of new features, including online applications and illustrations for advisers, we have also created a panel of carefully selected solicitors for property transactions. We are continually looking for new opportunities and ways to improve what we offer, in the short term we need to keep delivering on what we say we will, and continually look to improve whenever we can. Our eye is very firmly on the ball.
Investment Sense:
Turning to the wider SIPP market, what do you see as the main challenges over the rest of this year and into 2017?
Nigel Bennett:
The Financial Conduct Authority (FCA) introduced new capital adequacy rules this year, we know that this has had a huge impact on firms and has led to considerable consolidation in the market, which we expect to continue, as some providers struggle to meet the requirements of the new rules. We have always taken a prudent approach to our finances, this was recognised by AKG Financial Analytics Ltd who awarded us a B- rating in November 2016.
Investment Sense:
We’ve seen flexible access to pensions become more popular over the past 18 months, will this be a big area of growth for you?
Nigel Bennett:
Yes it has already been a good source of growth and I can only see that improving as more people retire over the coming years.
Nigel Bennett of InvestAcc can be contacted on 01228 538 988 or by emailing sales@investacc.co.uk
You can learn more about InvestAcc by clicking here to visit their website or here to visit their dedicated pages on the Investment Sense website by clicking here.
