Pensions  

Product review: Hornbuckle and PruFund Sipp

Product review: Hornbuckle and PruFund Sipp

Hornbuckle and Prudential have joined forces to offer a new self-invested personal pension (Sipp) using the Hornbuckle Sipp wrapper and Prudential’s PruFund range.

The new product hopes to offer advisers access to the full flexibility of pension freedoms while facilitating all income strategies under the new rules. The process has been aligned so advisers will have just one provider to contact (Hornbuckle) during the new business set-up process to make the experience as seamless as possible.

The firms say the solution combines stable investment returns with a fully flexible Sipp wrapper at value-for-money fees. These fees vary. Set up is normally £295 but a launch discount for a limited time means the set up is free. Plan administration for a single investment is £250 a year, and drawdown is £175. Cash contributions and transfers in or out of cash and PruFunds are free. But transfers in or out of a standard investment cost £150 per transfer and £500 per non-standard investment transfer. Commercial property costs £700 per transfer.

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Clients who use the proposition will be able to switch between the range of funds in the Sipp freely. Advisers can access it via a single application process including a joint application form which combines both the set up of the wrapper and placing the investment with Prudential.

Comment:

By teaming up with Prudential, Hornbuckle has created this new Sipp at a competitive price. The free set up cost (albeit for a limited time only) is an additional bonus. However, the PruFund range only includes six funds. So while the groups claim it will offer more flexibility for clients, there is still a limited amount they can use to invest in, should they wish to use funds within the portfolio.

However, it is also possible to have both standard and non-standard investments as with many Sipps in the market, so the popular choice of commercial property can be used in the Sipp.

It has been predicted that tie ups between Sipp providers and fund grousp will become more common to try to support advisers, improve efficiency and to lower costs. So long as there is enough choice when it comes to the number of funds, this would not be a bad idea.