Pension information is based on current UK legislation. Pensions are regulated by the FCA and The Pensions Regulator. This is not financial advice — consider consulting an FCA-regulated financial adviser.
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Your pension is likely your biggest investment after your home. Choosing the right provider can save tens of thousands in fees over your lifetime. Here’s how to choose.
For the wider cluster covering SIPPs, workplace comparisons and pension-versus-ISA decisions, use the main SIPP hub.
Pension Types Overview
Pension Type
Who Controls It
Typical Fees
Workplace pension
Employer chooses provider
0.3-0.75%
Personal pension
You choose provider
0.2-1.5%
SIPP
You choose (self-invested)
0.15-0.45%
Stakeholder
You choose (capped fees)
Max 1.5%
Workplace Pensions
Default Options
Provider Type
Typical Fee
Investment Approach
NEST
0.3% + £25/year
Default funds
The People’s Pension
0.5%
Default funds
NOW: Pensions
0.3%
Limited choice
Large corporate schemes
0.2-0.5%
Good fund range
Making the Most of Workplace Pensions
Action
Impact
Contribute to get full employer match
100% instant return
Check default fund
May not suit your risk level
Consider increasing contributions
Tax relief boosts value
Should You Stay or Transfer?
Stay If
Transfer If
Good fund selection
Very limited options
Low fees (under 0.5%)
High fees (over 0.75%)
Happy with default
Want specific investments
Employer contributes
Left that employer
Personal Pensions & SIPPs
Provider Comparison
Provider Type
Annual Fee
Best For
Ultra low-cost
0-0.15%
Passive investors
Low-cost
0.15-0.35%
Most investors
Full-service
0.35-0.45%
Wider choice needed
Advised
0.75%+
Wanting guidance
Fee Impact Over 30 Years
£200/month contributions, 5% growth:
Annual Fee
Final Pot
Lost to Fees
0.15%
£161,000
£5,000
0.45%
£150,000
£16,000
0.75%
£140,000
£26,000
1.00%
£132,000
£34,000
A 0.85% fee difference costs £29,000 over 30 years.
Flat Fee vs Percentage Fee
Portfolio Size
% Fee (0.35%)
Flat Fee (£100/yr)
Better Option
£10,000
£35
£100
% fee
£30,000
£105
£100
Break-even
£50,000
£175
£100
Flat fee
£100,000
£350
£100
Flat fee
£250,000
£875
£100
Flat fee
Switch to flat-fee provider as your pension grows.
Investment Options
Fund Types Available
Fund Type
Available At
Notes
Index trackers
Most providers
Lowest cost
Active funds
Most providers
Higher fees
Target date funds
Some providers
Auto-adjusts risk
Individual shares
SIPPs only
For experienced investors
Investment trusts
SIPPs only
Wide variety
ETFs
SIPPs only
Passive, tradeable
What Most People Need
Your Preference
Solution
Simple, hands-off
Target date or global tracker
Low cost
Index funds
Variety of assets
Multi-asset fund
Full control
SIPP with wide choice
Pension Features Comparison
Core Features
Feature
Basic Provider
Full SIPP
Online access
✓
✓
Mobile app
Sometimes
Usually
Contribution flexibility
✓
✓
Transfer in
✓
✓
Drawdown at retirement
Varies
✓
Tax-free cash
✓
✓
Additional Features
Feature
Why It Matters
Flexible drawdown
Take income without buying annuity
Good retirement tools
Model different scenarios
Consolidation support
Combine old pensions easily
Ethical options
ESG/sustainable funds
Customer service
Help when you need it
Transferring Pensions
When to Transfer
Good Reason
Be Careful If
High fees at current provider
Losing guaranteed benefits
Limited investment options
Exit fees apply
Consolidating old pensions
Defined benefit scheme
Better features elsewhere
Transfer will take long time
Transfer Process
Step
Timeline
Check current provider for fees/guarantees
Before starting
Apply to new provider, request transfer
Day 1
Old provider receives request
1-2 weeks
Funds transferred
2-8 weeks total
Investments selected
Within new provider
What You Might Lose
Feature
Check Before Transferring
Guaranteed annuity rates
Could be very valuable
Protected tax-free cash
Above standard 25%
Exit fees
May not be worth paying
Life cover
Separate from pension
Employer contributions
Only workplace pensions
Pension Costs Breakdown
Total Cost Calculation
Cost
What It Is
Typical Range
Platform fee
Provider’s charge
0-0.45%
Fund charges
Investment costs
0.05-1.5%
Trading costs
Buying/selling
£0-12/trade
Transfer fees
Moving pensions
Usually £0
Drawdown charges
Taking income
£0-100/year
Example: Total Annual Costs on £100,000
Provider Type
Platform Fee
Fund Fee
Total Cost
Low-cost (index)
£150
£70
£220 (0.22%)
Mid-cost
£350
£200
£550 (0.55%)
High-cost
£450
£750
£1,200 (1.2%)
How to Choose
Decision Guide
Your Situation
Consider
Just starting out
Low-cost provider, simple fund
Small pension (under £30k)
% fee provider
Larger pension (£100k+)
Flat-fee provider
Want hands-off
Target date fund provider
Want control
Full SIPP
Our Recommendation Flow
Step
Question
Action
1
Using workplace pension?
Maximise employer match first
2
Happy with workplace options?
Stay if good; add SIPP if not
3
How much to invest?
Under £30k = % fee; over = flat fee
4
Hands-off or active?
Target date or index fund
Before Retirement
What to Check
Age
Action
Any age
Track all pensions via gov.uk pension finder
50+
Review fund choice, reduce risk if appropriate
55+
Understand drawdown vs annuity options
60+
Model different retirement income scenarios
Retirement Options
Option
How It Works
Best For
Drawdown
Keep invested, withdraw as needed
Larger pots, flexibility
Annuity
Guaranteed income for life
Security, smaller pots
Mix
Some annuity, some drawdown
Balance of both
Cash
Take 25% tax-free, rest taxed
Very small pots
Key Takeaways
Fees matter enormously — 0.5% extra costs tens of thousands
Workplace pension first — get employer match
Match provider to pot size — % fee when small, flat fee when large
Don’t transfer blindly — check what you might lose
Review regularly — fees and needs change
Simple often wins — one global tracker beats complexity