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        0808 189 0463

        Updated: April 08, 2024

        SIPP Cash Deposit Accounts

        Want to hold cash in your SIPP? You’ll need the right SIPP cash savings account to suit. Find out all you need to know right here.

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        SIPPs – otherwise known as self-invested personal pensions – are flexible pension products designed to give you greater control over where you invest your retirement pot. But what if you want to keep part of your funds in cash? That’s where a SIPP deposit account comes in.

        This guide will take you through everything you need to know.

        What is a SIPP deposit account?

        Many people opt for a mixture of SIPP investments, across a range of different types of assets such as equities, commercial property, and cash savings when building their pension pot, with the latter particularly popular for those nearing retirement who want to reduce their risk profile. This means they’ll need a specific savings account in which to keep the cash portion of their pension – a SIPP deposit account.

        How do they work?

        SIPP deposit accounts operate much like any other savings account, in that they pay interest on any funds held within them and often come with added flexibility, such as the ability to withdraw funds – in order to invest in other areas within your SIPP – should you wish.

        They’re purely used for pension savings – which must be transferred from your SIPP – but crucially, you don’t always have to use the default account offered by your pension provider, unless they restrict access to third-party accounts. This means you’re free to compare the options available to find the account that works for you.

        Why get a SIPP deposit account?

        SIPP savings accounts are “capital guaranteed” – in other words, there’s no risk of losing your initial cash deposit, except in the unlikely event of your SIPP provider going bust.

        This is quite the contrast to equity-based investments where your returns can fall as well as rise and you may end up with less than you put in. This can offer greater security for those with a lower risk appetite and who don’t want to expose their pension fund to riskier assets and potential losses.

        Returns are also guaranteed in that they’re based on a set interest rate, though these can also change depending on the provider and whether you’ve got a fixed or variable rate of interest. Nonetheless, returns tend to be smoother and less volatile, which can be preferred by some pension holders.

        However, it’s important to bear in mind that SIPP cash interest rates tend to be lower than the potential returns achievable on stock market investments, albeit with the trade-off of cash having much lower risk. It’s vital to decide whether this kind of account will work for your retirement goals, which is why it’s recommended to speak to a specialist pensions advisor for the necessary support.

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        Types of account available

        There are generally two types of account to choose from – fixed term and flexible.

        • SIPP fixed term deposit accounts are much like fixed rate bonds, in that you agree to deposit your funds for a set length of time in return for a fixed rate of interest. Once the term comes to an end, you’ll get your original investment returned to you, plus any interest earned.
        • Flexible deposit accounts are more like easy access or notice savings accounts, typically allowing you to add additional funds to your pot and withdraw them when you wish (while adhering to any notice agreements, if applicable). You’ll still receive an interest rate and therefore a guaranteed return, though this will normally be variable and as such can fluctuate, and will typically be lower than fixed rates as well.

        How to open a SIPP deposit account

        Get advice.

        The first step is to speak to a pensions advisor who’ll be able to help you determine if this kind of account is right for you and, if so, help you find the best SIPP deposit accounts to suit.

        They’ll talk you through the processes involved, how to open the account and how to add and withdraw funds, covering things like fees and the risks involved, and will be able to advise whether a fixed or variable rate will be best for your circumstances. Contact us if you’d like to be put in touch with an expert advisor who can help.

        Compare the options.

        The next step is to start comparing potential accounts, which again is where an independent pensions advisor can come in.

        Because they aren’t restricted to any one provider they’ll be able to compare several different options for you, offering greater scope for finding a suitable deal. You’re of course free to do your own research as well, but it can often be simpler to have an expert on your side.

        Open the account.

        Once you’ve found the account that’s right for you, the final step is to open it and transfer the funds.

        Often you’ll need to do this via your SIPP scheme administrator or financial advisor, who’ll need to complete the application form and provide any relevant documents (such as the master trust deed, scheme rules, HMRC registration, a list of authorised signatories and an anti-money laundering certificate).

        You’ll then typically need to deposit funds directly from your SIPP via cheque, with cash deposits rarely accepted.

        Finding the best account for your needs

        The account that’s right for you will often come down to personal preference. For example, are you willing to lock your money away in return for a better rate, or would you prefer something with more flexibility? Would you like the ease of staying with your pension provider or would you rather look elsewhere?

        There are a lot of additional factors you may want to consider as well, such as:

        • Fees. The fees and charges involved should play a huge part in your decision, as they have the potential to eat into any returns you make.
        • Rates. You always want to get the best returns possible, but it isn’t always simple to find the best SIPP cash interest rates. This is particularly the case with variable rate accounts as the interest can fluctuate, so it’s important to speak to an advisor who’ll be able to help you track down the best deals.
        • Rules and restrictions. Some accounts have rules and restrictions which may not fit in with your overall pension strategy, so it’s important to always read the small print to make sure it will work for you.

        Which providers offer the best SIPP deposit accounts?

        There aren’t a huge number of SIPP deposit account providers to choose from, which means your choices may be limited. Though that’s not to say providers are impossible to come by. Some options include Santander (through their Cater Allen private banking arm), Close Brothers Savings, Scottish Widows and Mansfield Building Society, though bear in mind that products can be withdrawn at any time.

        Remember too that some SIPP providers won’t allow you to access third-party accounts, so you may be even more restricted. Again, it’s wise to speak to an advisor who’ll be best-placed to help you find suitable providers.

        Speak to a pensions advisor who specialises in SIPPs

        If you’d like to find out more about SIPP deposit accounts and want an expert pensions advisor to talk you through your options, we can help. We’ll put you in touch with a regulated, independent advisor who can offer a free pensions review, helping you determine if this kind of account is right for your retirement goals.

        Just call us on 0808 189 0463 or make an enquiry and we’ll match you with the expert to help.


        Provided your account is managed by a UK banking institution, then yes, any savings held in a SIPP deposit account should be protected by the FSCS.

        However, some accounts are operated by the provider’s offshore banking arm, which means they may not fall under the FSCS remit. They should however have equivalent protection from the relevant country’s scheme.

        No. All SIPPs will have a current account to handle any day-to-day cash transactions, which may or may not pay interest, and are typically provided by mainstream banks.

        Ask A Quick Question

        We can help! We know everyone's circumstances are different, that's why we work with brokers who are experts in pensions. Ask us a question and we'll get the best expert to help.

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        Tony Stevens

        Tony Stevens

        Finance Expert

        About the author

        Tony has worked in a vastly diverse array of areas in the pensions industry for over 20 years. Tony regularly writes for trade press, usually on topical and pensions pieces as well as acting as a judge at prestigious national events.

        Tony is also a highly qualified Independent Financial Adviser in his own right. His mantra has always been “Hope for the best, but plan for the worst”, and believes that the biggest impact that an adviser can have on a client’s life journey is to take them on a journey from generally having little or no real idea of what their retirement will look like, to giving them the understanding of what their retirement looks like now, then helping them navigate a path to what they want their retirement to be.

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