The combination of a wider choice of self invested personal pensions and the new pension freedoms mean many advisers are contemplating Sipp transfers.
Paul Evans, pensions technical manager of Suffolk Life, says this is because Sipps are able to provide investors with more options than ever before, and therefore the vehicle appeals to more investors than it has done in the past.
Pre-April 2015, Mr Evans says the primary motivations for transferring to a Sipp were a desire to consolidate multiple pension pots into one place, to gain access to a wider choice of investments, and to have more flexible options of taking retirement income.
The pension freedom world post-April 2015 has seen Sipps appeal to a wider range of investors that are motivated by the greater flexibility of income options available, Mr Evans says.
With no restrictions on the amount of money that can be withdrawn from a pension, Mr Evans says the experience and established propositions of Sipp providers used to paying out flexible retirement income is proving to be extremely popular.
The prospect of remaining invested while taking income is also driving the appeal of Sipps, he adds, warning this approach is not without risk.
Finally, for those with larger pension funds, Mr Evans says there is growing evidence that Sipps are being used as an effective means to pass assets to the next generation in a tax efficient manner.
However, he notes Sipps are still not for everyone.
He says investors who cannot afford or do not want access to financial advice may find the investment choice daunting.
Mr Evans says: “The charging structures of some Sipps are also likely to be unsuitable for investors with smaller fund sizes. And, once in retirement, investors that want risk free income for life will likely need to consider other options.”
