“It has been a huge success from that point of view and anything that encourages long-term saving can only be a good thing.”
However, Mr Tilley says among the high-net worth market in which Dentons operates, there has not been a “noticeable pick up” in new business for clients using the flexi-access drawdown route.
He comments: “We have seen the continuation of Sipp schemes for longer, as there is no pressure on clients to surrender assets in the run-up to, or at the point of, buying an annuity, simply because there is no ongoing requirement to.”
As a result, he comments that Sipps will have an “extended lifespan” up to and even after the death of a member, as benefits can cascade down generations.
Other reasons
But for George Houston, senior technical and development manager for Mattioli Woods, the pension freedoms regime is not the only reason for a greater take-up in Sipps.
He says: “Clients are attracted by the wider investment potential offered through Sipps and have recognised the traditional use of insurance company funds will not always meet their needs.
“The more we talk with clients about what they want to achieve with their businesses, the more appreciation there is of the potential benefits of using the wider investment possibilities that Sipps offer.”
