Interactive Investor SIPP Review: Should You Choose It?

The Interactive Investor SIPP provides a wide array of investment choices, including access to international markets, with transparent pricing to cater to savvy investors seeking control over their retirement savings.
  • Last Updated: 22 Mar 2024
  • Fact Checked
  • Our team recently fact checked this article for accuracy. However, things do change, so please do your own research.

Contributors:

Francis Hui
Discover the Pros & Cons of a Self-Invested Personal Pension & Find Out If It Could Be an Option for You. Read On to Find Out More.
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Key Takeaways
  • The performance of Interactive Investor SIPP varies depending on investment choices, but it generally offers a wide range of diversified investment options to help grow your pension pot.
  • To transfer, you’ll need to complete an online application process on their website, which includes providing your current pension details.
  • It charges a flat fee per month, which covers all your dealing and account costs, and additional costs if you choose to add funds or shares.
  • Opening an Interactive Investor SIPP involves signing up on their website, choosing your investments, and setting up contributions, either as a lump sum or regular payments.
  • Reviews can be found on various financial review websites, with many users praising its cost-effective structure and extensive investment options.

If you are evaluating your retirement plans, you may have come across the Interactive Investor SIPP

They say retirement is when you stop living to work and start working at living, but according to a 2022 Statista survey, 51–59% of Brits across different income bands were concerned that they would run out of money in retirement.1

SIPPs, or Self-Invested Personal Pensions, may offer a potential solution, as these products’ flexible approach to retirement savings allows individuals to manage their own investment decisions and adapt them to suit their changing financial needs.

In This Article, You Will Discover:

    In this article, the Every Investor team, known for its in-depth financial research, delves into the benefits, features, and potential drawbacks of the Interactive Investor SIPP to help you make an informed decision.

    Who Is Interactive Investor?

    Interactive Investor is a UK-based financial services company that provides an online investment platform.

    It offers services such as share dealing, funds, SIPPs (Self-Invested Personal Pensions), ISAs (Individual Savings Accounts), and other investment products.

    Interactive Investor allows investors to manage their portfolios, make investment decisions, and access a range of financial instruments through its online platform.

    Details about Interactive Investor may change over time, so it’s advisable to check for the latest information.

    What Is a SIPP?

    In the UK, the Self-Invested Personal Pension (SIPP) empowers savers with enhanced oversight of their retirement funds.

    This pension scheme enables the selection and administration of a wide array of investments such as equities, fixed income, and real estate within the retirement portfolio.

    What Is the Best Way to Manage My Interactive Investor SIPP?

    As professional copywriters with an investment background, we can confirm the best way to manage your Interactive Investor SIPP is to diversify your portfolio. By investing in a variety of assets such as equities, bonds, and mutual funds, you spread the risk and potential for returns.

    Regular reviewing and adjusting of your allocation based on market performance and your financial goals is also crucial. Moreover, consider harnessing Interactive Investor’s research tools and advisory services for informed decision-making. The platform’s regular insights, expert opinions, and market trend analyses can significantly enhance your investment strategy.

    Lastly, it’s beneficial to balance your high-risk investments with some low-risk assets to ensure stability. Remember, SIPPs are a long-term investment vehicle and patience coupled with strategic planning typically yields the best results.

    What Do Interactive Investor Do?

    Interactive Investor, or ii, provides a direct-to-customer platform allowing investors to manage and trade shares, funds, investment trusts, and bonds via trading accounts, individual savings accounts, and SIPPs.2 

    Brief History & Overview

    Interactive Investor International was founded in 1994 with a focus on front-end research for the investment community and quickly expanded its services to include trading capabilities, equities, and discussion boards for investors. 

    The company underwent several name and ownership changes, notably withdrawing from the South African and Asian markets and adopting the name Interactive Investor.3 

    In 2022, ii was bought by Abrdn for £1,5 billion.4

    Key Players in Interactive Investor’s Growth

    Sherry Coutu, co-founder of Interactive Investor International, was pivotal in its early establishment, with essential funding from angel investors Richard Caruso, John Cooper, and venture capital firm, Arts Alliance. 

    Tomás Carruthers, brought on board by Coutu in 1995, played a crucial role in enhancing the company’s offerings by introducing trading capabilities and equities. 

    Carruthers’ leadership remained significant through various ownership changes, leading the company through a buy-out in 2003 and later expansions, including collaborations like the one with Halifax Share Dealing in 2010.5

    Today, ii is led by CEO Richard Wilson, CFO Deborah Byard, and COO John Tumilty.6 

    Their effective leadership and industry insights have driven a strong expansion. 

    Current Market Position

    The company has over 400,000 customers, provides numerous investing tools, and manages over £50 billion in assets.7

    The company won Best SIPP Provider at the 2022 International Financial Awards and is Which? recommended.8

    How to Understand Self-Invested Personal Pensions (SIPPs)?

    Understanding Self-Invested Personal Pensions (SIPPs) is essential for navigating your retirement investment strategy.

    A SIPP is a tax-efficient,9 flexible pension scheme that provides more control and wider investment options than traditional pensions. 

    What is Interactive Investor’s SIPP Product?

    Interactive Investor’s SIPP product offers a robust platform for tailored retirement planning, combining flexible investment options with a flat fee, according to the firm.10

    Key Features & Benefits

    The key features and benefits of ii’s SIPP include wide investment choices and autonomy in investment.

    Other benefits are:

    • You will be charged a flat fee instead of a percentage fee, which may be advantageous if you have a larger portfolio. 
    • You can invest as little as £25 a month for free.
    • There is a range of withdrawal options at retirement.
    • There will be no extra charge when withdrawing funds at retirement.11

    Costs & Charges

    The firm’s starter plan, the Pension Essentials option, costs £5,99 a month.

    You will be moved to the Pension Builder plan when your investment reaches £50,000, and this plan is charged at £12,99 per month. 

    Good to know

    Adding a SIPP to your portfolio costs £5 per month if you are already an ii ISA or Trading Account holder, and if you are an Investor plan holder, you can add a SIPP for £10 a month.12 

    Other charges:

    • no withdrawal charges 
    • standard trades cost £3,99.

    How Does Interactive Investor Stacks Up Against Competitors?

    Evaluating how Interactive Investor stacks up against competitors in terms of fees will give you a good indicator of which SIPP will suit you.

    When comparing different providers bear in mind that some charge flat rates and others a percentage of the value of your pot. 

    There are also other charges to consider such as transaction fees and advisor fees.

    Compared to ii’s flat rate of £12,99, AJ Bell’s platform fee starts at 0,25% per year based on the value of your pension pot.13

    Hargreaves Lansdown’s annual charge starts at 0,45% pa up to the first £250k and no charge for the portion of a portfolio over £2 million.14 

    Curtis Banks has a flat annual fee structure starting at £352, going up to £817 for the full bouquet of investments.15

    Fidelity’s charges start at 0,35% for investments valued at less than £25,000 if you have a regular savings plan, or £90 p.a. if you don’t.16 

    While these fees and charges were correct on 21/12/2023, they may have changed since our last update.

    How Do You Invest With Interactive Investor’s SIPP Product?

    Investing with ii’s SIPP product provides a flexible and potentially tax-efficient way to build your retirement savings.

    Types of Investments Available

    Interactive Investor has streamlined the process for starting a SIPP, offering resources such as the Super 60 and ACE 40 rated investment lists, as well as Quick Start Funds and Model Portfolios. 

    The Super 60 list encompasses a variety of active and passive funds, investment trusts, and ETFs. 

    There is also a sustainable investment option featuring the top 40 funds, trusts, and ETFs in the ACE 40.

    The Model Portfolios simplify choices for investors, presenting five options focused on growth or income with either actively managed or tracker fund investments.17

    Flexibility & Withdrawal Options

    Interactive Investor’s SIPP offers diverse and flexible withdrawal choices for managing your retirement income. 

    These are:

    • Tax-free lump sum: As with other pensions, up to 25% of your pension can be withdrawn untaxed,18 with a cap of £268,275,19 even if you defer the rest.
    • Income drawdown: After a tax-free sum withdrawal, you can set up regular or occasional payments for the balance.20
    • Uncrystallised funds pension lump sums (UFPLS): Pensions can be withdrawn in chunks as needed; the initial 25% of each is tax free, with the remainder taxed as income.21
    • Annuity: For a fixed income, part or all of your pension can be given to another provider to buy an annuity.22
    • Combination: Multiple options can be combined, like merging a small annuity with an income drawdown, for a mix of stability and flexibility.23
    • Leave untouched: You can postpone retirement and let the pension grow or pass it to beneficiaries upon death (tax-free if death occurs before 75).24

    Tax Implications

    SIPP tax implications include a contribution limit of £60,000 or 100% of your annual earnings, whichever is lower.25

    The lifetime allowance, which previously limited pension accruals to £1,073,100 without extra tax charges, has been abolished. 

    As a result, this limit will not apply if you access your pension on or after 6 April 2023.26

    Who Is Interactive Investor’s SIPP Product Best Suited to?

    Interactive Investor’s SIPP product is best suited to DIY investors looking for a broad product range, reliable customer support, and a user-friendly platform.

    It is an excellent fit for investors with substantial portfolios who prioritise a fixed fee over percentage-based charges.27

    The SIPP also caters to those looking to invest in exchange-traded funds (ETFs), funds, or UK stocks, either as lump sums or on a regular automated basis.28 

    Important

    Always be mindful that investments can fluctuate in value based on a range of factors, and your capital is not guaranteed.

    How To Open an Interactive Investor SIPP?

    Opening an Interactive Investor’s SIPP is a simple process and will take just a few minutes.

    What Is the Minimum Investment?

    The minimum investment for opening a SIPP with ii is quite flexible. 

    There is a monthly investing option that starts at as little as £25 per month, making this product an accessible choice for a wide range of investors.29 

    What Is the Process?

    The process for opening an Interactive Investor SIPP requires you to be a UK resident. 

    The rest of the process is as follows:

    • Begin by visiting the website and selecting “Sign Up”. 
    • Choose the relevant account type and enter your personal details, including name, date of birth, and contact information. 
    • For identity verification, ensure you have your National Insurance number and debit card ready, and upload copies of your passport or driver’s licence, along with a recent utility bill or bank statement. 
    • After identity confirmation, you can proceed to fund your account.30

    How To Navigate Interactive Investor’s Digital Platform?

    Navigating Interactive Investor’s digital platform is a user-friendly experience, designed to simplify your investment and retirement planning processes.31

    User Interface & Experience

    The user interface and experience of the ii platform are geared towards easy navigation, making it ideal for less-experienced investors.

    Tools & Resources Available

    Interactive Investor’s platform features enhanced trading tools, curated model portfolios, and a host of educational resources.

    Features include:

    • Login and security: There’s a two-step authentication for enhanced security.
    • Search functions: These are versatile, allowing for asset and company lookups.
    • Placing orders: Multiple order types and time limits are available.
    • Alerts and notifications: Users can set up price movement alerts on the platform.
    • Portfolio and fee reports: Clear fee reports are available in the “Portfolio” section.32

    Mobile App Review

    The Interactive Investor trading app boasts a solid rating of 4.4 out of 5 on the App Store.33

    It offers a user-friendly platform to handle various investments like shares, ETFs, and fund trading. 

    Users can manage portfolios across different accounts and use features like watchlists, personalised news feeds, and customer service access. 

    The app also provides secure login with fingerprint and face recognition. 

    However, it lacks the advanced charting and customisable trading tools often sought by experienced traders.34

    How To Get in Touch with Customer Service & Support?

    Customer service and support are vital aspects of any service-oriented business.

    Contact Channels

    The contact channels for customer service are live chat, email, or phone. 

    Trading support is available in English, German, Arabic, Polish, Chinese, Japanese, and Hungarian, 24 hours a day, five days a week to cater to the international markets.

    Other support is available from 07:45 to 17:30, Monday to Friday.

    Existing customers can also send secure messages via the platform under “account > secure messages”.35

    Response Times

    ii offers customer support via phone and email, though the experience varies:

    The company claims that the average holding time to speak to its support teams is under a minute36 and emails within a few hours, while live chat is immediate.37

    Client Reviews & Testimonials

    With an impressive score of 4.7 out of 5.0 on the independent review platform Trustpilot, Interactive Investor holds an excellent rating. 

    A notable 89% of their responses are positive, with customers particularly praising their outstanding customer service.38

    What is Regulatory Compliance & Protection?

    Regulatory compliance and protection play a crucial role in ensuring the safety and integrity of financial institutions and their customers.

    Regulation

    Interactive Investor is regulated by the UK’s Financial Conduct Authority (FCA).39

    Regulatory Details:

    • FCA Reference Number: Interactive Investor Services Limited: 141282.40
    • Registered Company Number: Interactive Investor Services Limited: 02101863.41

    Financial Services Compensation Scheme (FSCS) Protection

    In the unlikely event that ii goes under and you cannot recover your money, you can claim up to £85,000 from the FSCS.42

    Data Security Measures

    The company takes data security seriously and uses cutting-edge encryption methods throughout all its trading services on the website, safeguarding your personal information, credit card details, and transaction records.43

    They maintain industry-standard security measures with 128-bit SSL encryption44 for all financial operations.

    Ensure your browser is SSL-compatible45 to access their site; an alert will pop up during login if it isn’t secure enough.46

    How To Evaluate Interactive Investor’s Place in the SIPP Market?

    Evaluating ii’s place in the SIPP market reveals it as a strong contender, thanks to its flat-fee structure and extensive investment options.

    Strengths & Weaknesses

    The strengths and weaknesses of the Interactive Investor SIPP play a crucial role in guiding potential investors.

    Strengths:

    • A flat platform charge, particularly beneficial for substantial portfolios.
    • A wide variety of investment options.
    • Comprehensive research resources.
    • Interest accrual on cash holdings.

    Weaknesses:

    • The platform’s charges might be steep for those with minimal portfolios.
    • Elevated fees when trading funds.
    • Above-average foreign exchange charges for shares outside the UK.47

    Predictions for Future Developments

    As the industry evolves, platforms like ii will need to meet shifting customer expectations, possibly by incorporating advanced analytics. 

    Growing customer knowledge and a desire for self-management are increasing the demand for sophisticated tools. 

    Concurrently, the trend of reduced fees in the investment sector could prompt ii to rethink its flat fee model, particularly for smaller investors.

    Final Thoughts & Recommendations

    Interactive Investor offers low initial deposits and fixed fees, making it attractive for large portfolios. 

    For smaller accounts, reduced fees and better analytical tools could make it more competitive. 

    What do I need to know?

    Always ensure your provider aligns with your investment strategy and goals.

    Common Questions

    Can I Manage My Interactive Investor SIPP Online?

    Can I Transfer My Existing SIPP to Interactive Investor?

    Can I Take Out Money from My Interactive Investor SIPP Before Retirement?

    What Is the Performance of Interactive Investor SIPP?

    How to Transfer to Interactive Investor SIPP?

    What Are the Charges of Interactive Investor SIPP?

    How to Open an Interactive Investor SIPP?

    Are There Any Reviews for Interactive Investor SIPP?

    In Conclusion

    Interactive Investor SIPP is a retirement savings product backed by robust regulation, ensuring your investment is in good hands.

    ii’s top-tier data security measures ensure your personal information stays private. 

    Its unique and transparent charging structure ensures your retirement funds are not eaten away by hidden fees. 

    In the UK retirement planning sphere, the Interactive Investor SIPP presents a secure, well-regulated, and affordable choice for your future savings.

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