Seemingly not content with a shake-up of the funds industry, Vanguard has set its sights on the wider pensions market. Having launched a platform for UK investors in 2017, the asset management giant has unveiled a self-invested personal pension (Sipp) with the stated goal of making retirement saving “simpler and less expensive”. While cheap, it’s an offering that could prove less universally appealing than the tracker funds that made Vanguard a global name in the first place.
The Vanguard Personal Pension stands out in plenty of respects for those with an eye on cost. Investors will pay an account fee of just 0.15 per cent, with those running large pensions pots shielded from the sometimes corrosive effects of percentage-based charges by a fee cap of £375 across all accounts in an investor’s name on the platform. This includes the Sipp, individual savings accounts (Isas) and general account.
This puts the new Sipp at odds with plenty in the market. To contrast it with one well-known example, Hargreaves Lansdown applies a 0.45 per cent account charge to the first £250,000 of assets in its Sipp, with this falling to 0.25 per cent on amounts between £250,000 and £1m, 0.1 per cent on the next million and no charge on assets above the £2m threshold.