Self-invested personal pension (Sipp) and small self-administered scheme (Ssas) providers’ biggest challenge this year is bad publicity, the Association of Member-Directed Pension Schemes (Amps) chairman has said.
Claire Trott, the first female chairman of the industry body representing Sipp and Ssas operators, noted the regulatory spotlight on the industry in recent months, following a number of failed investments believed to be scams.
However, Ms Trott, who succeeded Berkeley Burke's Zachary Gallagher in November 2018, also pointed out that the majority of providers were doing the right thing.
She explained: "There's been a significant amount of bad publicity over the last few years with either Sipps or Ssas being blamed for scams, pensions mis-selling, or providers that are in the spotlight for issues with investments.
"But we do know that the majority of Sipp and Ssas providers out there are doing exactly the right thing for their clients, doing all the appropriate due diligence."
In October, a judge ruled in the High Court that Sipp providers had a duty to act as gatekeepers and check underlying investments were sound before accepting business.
Ms Trott, who continues in her role as head of pensions strategy at St James's Place, added that advisers will need to make sure they are advising their clients to go into the right type of product, with the right provider, and that it was a good idea to stick with "providers that you know".
She explained: "Going to someone who is new and who you've never heard of that has no history is something that you should probably avoid.
"As we know, Sipps aren't for everybody and that really needs to be remembered."
She suggested advisers will need to make sure they're advising their clients to go into the right type of product, and if they are suitable for a Sipp, to select the correct Sipp wrapper.
She added: "Sipps are for life, as we know, and now Sipps and pensions will go long into people's death as well, providing benefits for their children and their grandchildren."
Watch the full video at the top of the page.