Table of Contents
Executive Summary
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- The market
- Value of SIPPs grew by 42% in the last year
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- Figure 1: Proportional distribution of volume and value of SIPPs in force, by sector, as August 2016
- New sales forecast to reach 1.4 million in 2022
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- Figure 2: Forecast of volume of FCA SIPP sales – fan chart, 2012-22
- Four fifths of SIPPs are sold without advice
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- Figure 3: Proportion of total FCA SIPP sales sold through advised and non-advised channels, 2013-16
- Companies and brands
- Standard Life is the biggest provider of SIPPs, by AUA
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- Figure 4: Estimated market share of the largest five SIPP providers, by AUA, 2017
- The consumer
- Stocks and shares are the most common type of SIPP asset
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- Figure 5: Investments held within SIPP, September 2016 versus August 2017
- Investors are torn between risk and reward
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- Figure 6: Important factors when choosing an investment or asset for SIPPs, August 2017
- Consumers look for clear, as well as low, prices
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- Figure 7: Important factors when choosing a SIPP provider, August 2017
- Half of investors have consulted an adviser in the last year …
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- Figure 8: Recent activity relating to SIPP investment strategy, transfers and switching, August 2017
- … and 2018 should be similarly busy for advisers
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- Figure 9: Expected future activity relating to SIPP investment strategy, transfers and switching, August 2017
- Two thirds have maintained or increased SIPP contributions
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- Figure 10: SIPP contribution levels over the past year, August 2017
- A strong consumer commitment to ongoing SIPP investment
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- Figure 11: Expected SIPP contribution levels over the coming year, August 2017
- Online services are the most commonly used channels to access SIPPs
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- Figure 12: Channels used to access SIPP in the last six months, August 2017
- Investors actively prefer online to face-to-face access
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- Figure 13: Preferred channels to use to access SIPP, August 2017
- What we think
Issues and Insights
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- Investors remain upbeat for the future
- The facts
- The implications
- More can be made of digital opportunities, but there is a limit
- The facts
- The implications
The Market – What You Need to Know
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- Value of SIPPs grew by 42% in the last year
- Four fifths of SIPPs are sold without advice
- CapAd rules have shaken up the industry
Market Size and Forecast
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- Value of SIPPs grew by 42% in the last year
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- Figure 14: Volume and value of SIPPs in force, as at August 2016 vs August 2017
- Number of new SIPPs grew by 15% in 2016
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- Figure 15: Number of FCA SIPP sales, 2012-17
- New sales forecast to reach 1.4 million in 2022
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- Figure 16: Forecast of volume of FCA SIPP sales – fan chart, 2012-22
- Figure 17: Forecast of new FCA SIPP business, at current prices, 2012-22
- Forecast methodology
Channels to Market
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- Four fifths of SIPPs are sold without advice
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- Figure 18: Proportion of total FCA SIPP sales sold through advised and non-advised channels, 2013-16
- Personal investment firms were responsible for 54% of sales in the last year
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- Figure 19: Proportion of FCA SIPP sales, by firm type, Year to June 2017
Market Drivers
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- Two fifths of SIPP investors report improved finances …
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- Figure 20: Current financial situation compared to a year ago, by gross annual household income, August 2017
- … and confidence is high for the future
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- Figure 21: Financial confidence, August 2017
- Auto-enrolment now fully rolled out
- Still no joy for savers
Regulatory and Legislative Changes
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- CapAd rules have shaken up the industry
- FOS reports rise in SIPPs complaints …
- FCA highlights due diligence as scams become more sophisticated
Companies and Brands – What You Need to Know
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- Standard Life is the biggest provider of SIPPs, by AUA
- Acquisitions and digital developments are at the heart of SIPPs innovation
Market Share
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- Standard Life is the biggest provider of SIPPs, by AUA
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- Figure 22: Estimated market share of the largest five SIPP providers, by AUA, 2017
- Expected mass contraction of providers has failed to materialise
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- Figure 23: Number of SIPP providers and percentage of total sales by top providers in each quarter, Q1 2008-Q1 2017
Competitive Strategies
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- Mergers and acquisitions remain at the forefront of SIPPs strategy …
- … while digital innovation is opening new opportunities
- BondMason launches P2P SIPP
The Consumer – What You Need to Know
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- Stocks and shares are the most common type of SIPP asset
- Investors are torn between risk and reward
- Consumers look for clear, as well as low, prices
- Half of investors have consulted an adviser in the last year
- Two thirds have maintained or increased SIPP contributions
- Online services are the most commonly used channels to access SIPPs
SIPP Asset Mix
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- Stocks and shares are the most common type of SIPP asset …
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- Figure 24: Investments held within SIPP, September 2016 versus August 2017
- … driven by higher ownership among younger and higher-earning investors
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- Figure 25: Investments held within SIPP, by age and gross annual household income, August 2017
- Half of investors have three or more types of asset in their SIPP
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- Figure 26: Investments held within SIPP, repertoire analysis, August 2017
Asset Choice Factors
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- Looking for the best compromise …
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- Figure 27: Important factors when choosing an investment or asset for SIPPs, August 2017
- … but risk aversion grows with age
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- Figure 28: Choice of “Low risk” as an important factor when choosing an investment or asset for SIPPs, by age, August 2017
- Cost is key, despite SIPP investors’ wealth
- Ethical investing is still a niche enterprise
SIPP Provider Choice Factors
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- Price competition is important …
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- Figure 29: Important factors when choosing a SIPP provider, August 2017
- … but heritage is also influential
- Transparency is an attractive quality
- Older investors more likely to be swayed by choice of investments
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- Figure 30: Choice of “Widest possible range of investment choices” as an important factor when choosing a SIPP provider, by age, August 2017
- Interest in mobile apps has increased tenfold since 2015
Investment, Transfer & Switching Activity
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- Half of investors have consulted an adviser in the last year …
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- Figure 31: Recent activity relating to SIPP investment strategy, transfers and switching, August 2017
- … and four in 10 have switched funds
- More changes expected in the coming year
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- Figure 32: Expected future activity relating to SIPP investment strategy, transfers and switching, August 2017
- Younger investors are more likely to be planning a change in their SIPP
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- Figure 33: Agreement with expected future activity relating to SIPP investment strategy, transfers and switching, by age, August 2017
Changes in Contribution Level
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- Two thirds have maintained or increased SIPP contributions
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- Figure 34: SIPP contribution levels over the past year, August 2017
- Higher earners have acted more bullishly
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- Figure 35: SIPP contribution levels over the past year, by gross annual household income, August 2017
- Half expect to keep their contributions level over the next 12 months
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- Figure 36: Expected SIPP contribution levels over the coming year, August 2017
Channels Used to Access SIPPs
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- Online services are the most commonly used channels to access SIPPs
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- Figure 37: Channels used to access SIPP in the last six months, August 2017
- Mobile is driven by younger investors
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- Figure 38: Preferred channels to use to access SIPP, August 2017
- Women are more likely to favour seeing an adviser in person
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- Figure 39: Preferred channels to use to access SIPP, by gender, August 2017
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Total market sales forecast – Best- and worst-case scenarios
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- Figure 40: Forecast of FCA SIPP sales – Best- and worst-case scenarios, 2017-22
- Forecast methodology
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