More look to private equity for pensions

05 August 2005
Thousands of pension holders are thought to be preparing to invest their pensions in private equity funds when the new pension rule changes come into effect on 'A-Day'.

Private investor network Hotbed released the results of a study which reveals that private equity appears to be the most popular alternative investment for those trying to boost their pension fund, reports the Daily Telegraph.

One of the significant changes to pension rulings in A-Day next April, will be the revision of what assets can be held in self-invested private pensions (SIPPS). From then on, it will be possible to place private equity, residential property, hedge funds and luxury items into a SIPP, for which one will receive corresponding tax benefits.

Hotbed's survey found that in the region of 67 per cent of investors plan to invest in private equity.

Gary Robbins from Hotbed said: "Private equity is complex, risky and harder to source than some alternative assets.

"However, the type of high net worth individuals who have SIPPS are often attracted to the asset class as they understand the risks and rewards involved."

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