10 powerful reasons to recommend IPM to your clients
For most businesses, the new year is an opportunity to look back over the previous 12 months to assess how well you did, what you could have done better, and what changes you can make. It’s fair to say that 2020 presented its challenges, but there is still a lot that we can take from it.
Like many of you, lockdown 1.0 in March 2020 resulted in a dip in interactions with clients and advisers while everyone adapted to the new normal of remote working. This, in turn, led to our new business not being at the level we would normally see.
However, in the second half of 2020, we saw an increase in the number of financial advisers we spoke with and the enquiry levels we would usually receive. New business levels were at the same level as any normal year; indeed, in some months they exceeded what we would normally expect to see.
As the level of new advisers we work with increases, we thought it would be good to look at ten reasons why IPM should be your choice of SIPP provider. Next month, in the interests of fairness, we will also look at some instances where IPM would not be the SIPP provider for you!
1. We’re committed to the SIPP market
Although established in 1999, the scheme we administer was established in 1995. As such, we have over 25 years’ experience in administering self-invested personal pensions.
During this time, we have seen the market change beyond recognition. Innovation has opened up SIPPs to the masses, and while many new providers have entered the space, we’ve also seen a number close their doors.
There are still many traditional SIPP providers like IPM in the market alongside other companies who offer a SIPP as part of a range of other services. IPM never has and never will offer any other services such as an investment platform or a financial advice arm. Administering SIPPs is all that we do.
As such you can be confident that, when recommending IPM, you are recommending a specialist and dedicated SIPP provider who is committed to the market for the long term.
2. Our ownership structure means we control our own destiny
IPM is a limited company with private shareholders, each of which take a day-to-day interest in the company. None of these shareholders have any other business interests.
There is no larger parent company to consider, and no outside third parties who have a say in how we run our company. As such we are in control of our own destiny and we can make all decisions with the best interests of IPM at the forefront.
Like any well-run business there is a succession plan in place in the event of any change to shareholders’ circumstances. This involves staff members already in the business who have been with IPM for more than 15 years.
3. We have an expert, experienced and specialist team
Like many service-based companies, our people represent our business on a day-to-day basis. We may be biased, but we feel fortunate to have built the team we have at IPM.
We have more than 30 members of staff working out of our Hertfordshire office (or remotely at the moment!), most of whom have been with us for more than ten years. It was a novelty when we acknowledged our first few colleagues on their ten-year anniversary; now we have several a year!
The fact our people have been with us for such a long period of time is important. For our advisers and clients, it provides important continuity, in that you can pick up the phone to someone you have not spoken to for a while but who is still available to take your call.
The low staff turnover also allows our team to continue to build their experience so they remain best-placed to assist you.
4. We are profitable
It is important for any business to make money, and IPM is no different. But, for SIPP providers, there are additional considerations to be given when it comes to profitability.
You may know that in 2016, the FCA introduced new requirements for SIPP providers to significantly increase the amount of capital adequacy they retain. The amount retained is determined by a combination of the value of the assets within the scheme and the number of clients who hold non-standard assets in their SIPP.
Given that all shareholders of IPM have a day-to-day interest in the company, the fact that we retain profits in the business ensures we meet (and significantly exceed) our capital adequacy requirement. This is without the need for any loans or outside investment.
As the number of clients we attract grows, our capital adequacy requirement increases due to the value of the assets we look after. As of December 2020, IPM’s capital adequacy requirement is £1.9m.
We regular publish our turnover and profit figures in our Due Diligence document. Head to our website to request one.
5. We’re committed to steady, manageable growth
We focus our business model on providing a service to our clients on a long-term basis.
One of the key aspects of our offering is our personal service; for us, two clients’ circumstances are rarely the same. Therefore, we are not seeking to grow our client base by thousands and thousands of clients a year because our service levels could potentially suffer.
Instead, we grow our client base steadily, taking on a few hundred clients each year. Managing this growth carefully not only means we can provide a high level of service for the new clients joining us, but that we can continue to support those clients who have been with us for many years. We are proud that client number 0001, who joined us in 1995, is still with us!
We are also not interested in the acquisition market.
6. One, simple SIPP
Many of our competitors offer a variety of different SIPPs, sometimes by choice or perhaps because they have inherited them through acquisitions. Examples can include single investment SIPPs, SIPPs where providers limit the investment choice to several preferred partners, and then full SIPPs which allow access to all the different flexibilities that provider offers.
Not only do these various SIPPs come with different investment solutions, but they also have differing pricing structures.
For some clients, we appreciate that one of these solutions may meet their requirements. However, at IPM we have always only offered the one SIPP – the IPM SIPP – which is a full SIPP offering a wide variety of investment choices with a simple, transparent fee structure.
7. Straightforward fees
To go with our ‘one SIPP’ offering, IPM works with a straightforward fee structure. It’s simple for you and your clients, and easy for us to administer.
We charge a flat annual administration fee of £540 + VAT. This is regardless of whether a SIPP has a value of £10,000 or £10m. Typically, our clients will have fund values in excess of £100,000 although there are instances where this is less; when purchasing a commercial property, for example.
We haven’t increased our annual fee since 2001 and we have no plans to change it.
IPM does not charge:
- An establishment fee
- Transfer-in fees
- Contribution fees
- Fees for making standard investments
- Fees for moving money to and from the trustee bank account.
Most of the work we undertake on our clients’ behalf is covered by the annual administration fee. Notable exceptions include when a client enters drawdown, purchases a commercial property, or purchases a non-standard asset.
This fee structure is simple and straightforward, and your clients do not receive any unpleasant surprises when the annual invoice arrives.
8. A wide investment selection
IPM does not operate panels of investment houses your clients must select from.
This means you can work with the most appropriate discretionary fund manager, platform, bond provider, stockbroker, or third-party bank that best meets your client’s requirements, so long as they satisfy our investment assessment criteria.
In most instances, all investments made in an IPM SIPP are covered by the annual fee the client already pays to us.
Our approach to investments is particularly helpful to clients who may wish to hold more than one investment solution in their SIPP. Find out more about how our flexibility can benefit your clients.
We will also consider non-standard assets on a case-by-case basis. Bear in mind here that we are talking about investments such as quarterly dealing hedge funds, third-party bank accounts that cannot be broken within 30 days, and property funds which may have dealing dates in excess of 30 days – not some of the more esoteric investments that have been put to us!
9. We’re commercial property purchase experts
Purchasing commercial property within SIPPs is a major area of expertise for us. We own more than 1,000 properties within the scheme and typically have 30 to 40 purchases ongoing at any one time.
We employ an experienced property team and we allocate a member to each individual purchase, so you have a dedicated point of contact from instruction through to completion and beyond. You have direct access to the individual dealing with the purchase, as unlike other investments we make, property purchase can often be an emotive subject!
It’s testament to the hard work of our property team that some of the first properties bought through IPM SIPPs in the late 90s are still with us today.
And, as we don’t charge an additional annual property fee on top of our annual administration fee, we can boast one of the most cost-effective charging structures in the SIPP market for this type of work.
Additionally, your clients won’t pay any additional annual charges for borrowing within a SIPP or a for a group property arrangement. Many of our competitors often make a charge for these.
10. We can help your overseas clients
IPM appreciate that clients’ circumstances may change, both personally and professionally. It is not uncommon for clients to retire abroad, move to another country for work, or work in the UK for several years and build up UK pension benefits.
We have clients living all over the world, from Europe to Australia, from the US to Asia. As long as the client has UK pension benefits which they wish to consolidate, then we may be able to assist.
Additionally, we can often run SIPPs in currencies other than GBP. Pension commencement lump sums and/or income can also be paid in non-GBP currencies – for example, EUR, USD, or AUD. Read more about how we can help your overseas clients.
Get in touch
Next month, we’ll share some of the reasons why we might not be the right firm for you or your clients. In the meantime, if you want to have a chat about the potential of SIPPs for your clients, or any other aspects of pension planning, please contact us. Email info@ipm-pensions.co.uk or call 01438 747 151.