Best Pension Companies in UK
Updated October 19, 2023
- Best Pension Companies in the UK
empty
empty
empty
empty
empty
empty
empty
- How to Choose the Best Private Pension Provider for You
- Frequently Asked Questions
- Final Thoughts
Best Pension Companies in the UK
Below you will find a selection of some of the best pension companies in UK.
The providers on this UK private pension companies list vary in fees and minimum investment requirements, so it’s important to do your research to determine which of these top UK pension companies might be best for you.
1. Hargreaves Lansdown
Minimum investment: Monthly contributions of £25
Annual fee: 0.45% up to £250,000; 0.25% from £250,000 up to £1 million
Consolidation fee: None
Type of pension: SIPP – ETFs, stocks, shares, investment funds
Hargreaves Lansdown was founded in 1981 as a premium financial services company. Managing over a million share accounts and more than £105 billion in assets, Hargreaves Lansdown is a FTSE 100 company that offers a SIPP for personal pension investors.
Accounts can be opened online very simply, and what makes Hargreaves Lansdown stand out among its competition is that it offers professional financial advice and customer service that is fast, responsive and supportive. Unlike other online providers, customers can get access to consultations either over the phone or face-to-face.
Despite the premium service from Hargreaves Lansdown, there is no minimum deposit and the account management and funding fees are about average among other pension providers.
2. Netwealth
Minimum investment: £50,000
Annual fee: 0.70% £50,000 to £249,999; 0.55% £250,000 to £999,999; 0.40% £1 million-plus
Consolidation fee: None
Type of pension: SIPP – ETFs, stocks, shares, investment funds
Netwealth is a wealth management service that was launched in the UK in 2016. It is an online investment service that includes access to a qualified team of advisors and offers a SIPP for customers.
If you want to open an account, you’ll have the opportunity to describe the way you want to invest in a short quiz. You’ll need to decide what your goals are, how much you want to contribute and what your risk appetite is, as well as the type of investments that you want to make.
Aimed at more affluent investors, as can be seen with the minimum investment, the Netwealth team also have a team of financial advisors available for consultation – at £200 per hour. As you might expect, the platform fee is tiered based on the value of the fund, tapering down the more that is in the fund.
3. iSIPP
Minimum investment: None
Annual fee: £200 Trust fee; 0.25% platform fee
Consolidation fee: None
Type of pension: SIPP – ETFs, stocks, shares, investment funds, plus ESG and Shariah funds
iSIPP is part of the iPensions Group, which is a cost-efficient pension service that does not offer advice but has more than 20 years of experience and supports more than 6,000 customers with their SIPP.
This digital pension can be opened and managed online, and depending on your experience and knowledge you can decide whether to invest in one of the ready-made funds (as provided by BlackRock) or in one of the 100-plus funds that are available.
As a consolidation service, this is an ideal choice for self-employed individuals and freelancers. Contributions can be made on an ad-hoc or regular basis, which makes it more flexible and easier to control.
If you want to move this pension pot elsewhere, you need to be aware that there is a £500 exit fee to be paid.
4. Vanguard
Minimum investment: £500 lump sum; £100 per month
Annual fee: 0.15% annual fee; fund charges from 0.03% to 0.30%; no account fee over £250,000
Consolidation fee: None
Type of pension: SIPP – ETFs, Vanguard Target Retirement Fund
Vanguard was established as a financial services and fund management company in 1975, and its UK SIPP offering comes from the Vanguard Investor platform that was created in 2017.
Owned by investor funds, the company is deeply invested in making money for its customers – and that is why it offers a range of low-cost index tracking funds that are among the cheapest to invest in.
Vanguard SIPP accounts can be opened online, and you can transfer existing pension plans to the Vanguard SIPP. You can choose whether you want to invest a lump sum or a monthly contribution – but you need to invest at least £100 a month.
For those who are fee-conscious, it is worth noting that the 0.15% account fee is less than half the industry average, and the other fees are quite low too.
This is great if you are seeking top UK pension companies but are concerned about costs, but one of the negatives of this pension provider is that you are only able to invest in Vanguard’s funds.
5. Wealthify
Minimum investment: None
Annual fee: Total fees range from 0.76% to 1.30%, depending on fund choice
Consolidation fee: None
Type of pension: SIPP – ETFs, stocks, shares, investment funds
Wealthify is an example of what is known as a robo-investor – a simple platform for pension investing that offers a premade portfolio based on your description of your attitude to risk. Portfolios are based on a combination of cash, shares, government bonds, property and corporate bonds.
It is simple to open an account online, and you can transfer your existing pensions in to consolidate them.
Although there is no advice offered, the Wealthify platform creates the right portfolio using analytical tools and algorithms. Wealthify is partnered with Aviva, a real juggernaut in the world of savings and pensions.
6. Aviva
Minimum investment: Monthly payments of £50
Annual fee: Platform fee and fund fee – up to 0.40%
Consolidation fee: None
Type of pension: SIPP – shares, fixed interest, property, money markets
One of the biggest UK pension companies, Aviva is a well-known name in the world of finance and is often the provider of choice for workplace pensions – which means it knows its way around investments.
Its personal pension offering includes a stakeholder pension and the SIPP, and you can apply and open an account online very easily.
There are a lot of resources available at Aviva to help you make the best financial decisions based on your retirement aims, but there is one way that the Aviva SIPP differs from the other providers described – it does not offer an app or any real access to your account other than an annual statement, so you cannot manage and adjust your pension easily.
With 18 million customers, Aviva is a big, reliable and established brand – which might make it a simple choice if you are looking for a no-frills pension plan.
What Do UK Pension Companies Do?
A pension is a way to save for your retirement, and it is more tax-efficient than other savings plans like ISAs.
UK pension companies offer customers the opportunity to invest and save money on a regular basis with the aim of providing cash upon retirement that can be taken partially as a lump sum, as an ongoing income or as a combination of these.
Most people who have been employed in the UK will have at least one workplace pension – this is set up on your behalf by your employer.
Self-employed people, or those who want to save in a different way, have more control over their investments, or create a consolidated pot for numerous pensions and can choose a personal pension.
In this article we will look at the best personal pension companies in the UK.
Different Types of Pensions
There are three main types of pensions that you can have in the UK.
State Pension
Most people who have had a job will be able to claim the State Pension when they reach retirement age.
The amount that you get will depend on how much you have contributed to National Insurance – the maximum amount is £203.85 per week, which is based on 35 years of contributions.
You can currently claim State Pension at the age of 66 (67 from 2028). If you have not made 35 years of contributions, you can top it up with voluntary contributions.
Even the full amount might not be enough to fund your lifestyle, so many people have other pensions to help.
Workplace Pension
If you are aged between 22 and the State Pension age and earn more than £10,000 a year, your workplace will offer you the opportunity to enrol in a workplace pension scheme.
A percentage of your salary is paid into your pension account, and your employer will match the contribution up to a certain percentage.
If you have had many jobs, you are likely to have several separate workplace pensions. Workplace pensions can vary from one provider to the next, for example, UK companies with defined benefit pension plans or alternatively other schemes with different terms and benefits.
Personal Pension
You can use a personal pension to save as much as you like – up to annual and lifetime maximums (for the 2023/2024 tax year, that is an annual limit of £60,000 and a lifetime limit of £1,073,100).
The government tops up your personal pension contributions by 25%, and you can control how your pension is invested – whether you want to play it safe in a low-risk portfolio or be more aggressive in investing.
How Do Pensions Work?
Pensions are long-term investments. Whether you make lump sum contributions or monthly payments into your pension fund, you are not able to access the money until you turn 55 (57 from 2028).
At this point, you will have a pot of money that has been invested, and has hopefully grown – although like all investments, your capital is at risk and the value of your fund might drop too.
When you reach the right age, you can decide what to do with your pension. You might want to take a lump sum – up to 25% – and this can be accessed tax-free.
You might want to arrange for the rest to be paid to you monthly (like a salary) through an annuity, or you might want to leave the rest in the pot and continue to make payments to it until you decide to retire.
What Do UK Pension Companies Do?
A pension company is responsible for providing the framework for your pension investment.
Most private pensions are SIPPs (Self-Invested Personal Pension), which gives you some freedom about how you want to invest, whether you want access to ready-made funds or if you want to decide what stocks and shares to invest in.
Pension companies will also help you to consolidate other pensions into one place, which can be easier for you to manage and keep track of. Some might offer financial advice.
For the service of providing this saving and investing framework, the pension company will charge fees. These include a service fee and fund fees and can vary greatly across providers.
How to Choose the Best Private Pension Provider for You
Above we have looked at some of the UK companies with the best pensions.
However, with so many different pension providers available, choosing the right one for you will depend on several factors – it is a personal choice that you should make by deciding on what is important for you.
Of course, one of the most important factors when choosing the best UK companies for pensions should be that the providers are FCA regulated.
Your pension is savings to help you in retirement, so you want to make sure that the funds are kept safe – which the FCA will protect (up to £85,000).
Other than that, shop around with a list of your own prerequisites and requirements so that you can pick the right one for you.
Step 1. Beginner-Friendly or for More Experienced Investors
Opening a personal pension, even SIPP plans, is simple – most can be completed within minutes online.
What this means is that if you are not financially astute, or you don’t want to learn about investments and money management, there are excellent simple pensions with the likes of companies such as PensionBee, Penfold or Moneybox that are good choices.
However, like many of the options listed above, more experienced investors might want to choose their own investments and how they want to build their retirement portfolio.
Customer service is also an important part of this – you might be looking for a provider that offers financial advice, or just a customer service provision that is available 24/7.
You need to decide how hands-on you want to be with your pension investments, as well as what your risk appetite is and what your retirement goal will be.
Step 2. Check Contributions
Aside from the initial deposit, most pension funds will have some requirement for ongoing contributions – usually monthly.
When compiling a UK pension companies list for comparison, it is worth looking into what the rules are for each provider in terms of minimum monthly contributions.
If you must meet a minimum amount in contributions, is that something that you are going to be able to continue to do? What about if you lose your job, or other circumstances reduce your income?
Many of the biggest UK pension companies can offer flexibility when it comes to contributions, but make sure you check in case there are any financial penalties if you need to make irregular payments.
Step 3. Fees
Cost is also a big factor for many people when it comes to any sort of financial services.
You can expect to pay some sort of fees for the service of providing a pension service, but the range of fees charged can feel confusing.
The different costs that can be included in a pension plan can include:
- Platform fee
- Fund management fee
- Transaction fee
- Transfer fee
While you might want to reduce your costs, remember that the cheapest option might not be the best when it comes to your needs – so consider the balance between cost and what you get for your money when you are comparing providers on your UK pension companies list.
Step 4. Consolidating
For individuals who have had many jobs, several smallish pension pots being held by different companies might prove difficult to manage – which is why a personal pension that offers consolidation might be the better option.
Consolidating pensions not only makes it easier to manage, but it can be more cost effective too – combining pots reduces fees, and the more there is in the fund usually means the less costs there are in general.
Pension companies, often referred to as pension providers or pension funds, are financial institutions that manage and administer retirement savings and investment plans.
Their primary role is to help individuals save for retirement by offering various pension products and investment options.
Pension companies ensure that contributions made by individuals or employers are invested wisely to generate returns, ultimately providing retirees with income during their retirement years.
Determining the best UK pension companies can be subjective, as it depends on individual financial goals and preferences.
However, some prominent and well-regarded pension providers in the UK include Legal & General, Aviva, Standard Life, Scottish Widows, and Royal London.
It's essential to research and compare factors such as fees, investment options, customer service, and track record before selecting a pension provider that aligns with your retirement objectives.
Pension companies generate revenue through various means. They typically charge fees for managing pension funds and providing administrative services. These fees may include management fees, annual charges, and sometimes exit fees. Pension companies also earn income by investing pension funds in various financial instruments, such as stocks, bonds, and real estate, and then sharing a portion of the investment returns with plan participants.
The financial stability of pension companies can fluctuate due to market conditions, economic factors, and investment decisions. In the UK, the Pension Protection Fund (PPF) provides a safety net for pension schemes in the event of a company's insolvency. It's essential to monitor the financial health and regulatory compliance of your chosen pension provider to mitigate risks to your retirement savings.
As of my last knowledge update in September 2021, Legal & General was one of the largest pension providers in the UK. However, the landscape of pension providers can change over time due to market dynamics and mergers/acquisitions. It's advisable to check the latest industry reports and rankings to determine the current largest pension provider in the UK.
Yes, UK pension companies are subject to stringent regulation by government authorities, primarily the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR). These regulatory bodies oversee the pension industry to ensure that pension providers adhere to strict standards, protect the interests of pension scheme members, and operate transparently. Compliance with regulatory guidelines is essential to maintain the integrity and stability of the UK pension sector.
Choosing a suitable UK pension company involves careful consideration of your retirement goals, risk tolerance, and financial preferences. Start by researching reputable pension providers, comparing their fees, investment options, and customer service.
Seek advice from a financial advisor if necessary, and assess the provider's track record for delivering consistent returns. Ensure the company is regulated by the Financial Conduct Authority (FCA) and offers pension products that align with your retirement objectives, whether that's a defined contribution plan or a self-invested personal pension (SIPP).
Yes, you can transfer your pension from one company to another. Transferring a pension, also known as a pension transfer, can consolidate your retirement savings or allow you to switch to a different pension provider with better terms.
However, it's essential to consider any potential fees, benefits, and tax implications before initiating a transfer. Seek guidance from a financial advisor, as not all pensions are transferable, and some may come with valuable guarantees that you should evaluate carefully.
You can find a list of UK pension companies by conducting an online search or visiting the website of industry organizations such as the Pensions and Lifetime Savings Association (PLSA).
The Financial Conduct Authority (FCA) also maintains a register of regulated pension providers on its website. These lists can help you explore various pension companies and narrow down your options when selecting a provider for your retirement savings.
In most cases, you cannot access your pension funds before reaching the minimum retirement age specified by your pension plan, which is typically 55 years in the UK.
Early access to pension funds may be possible in exceptional circumstances, such as ill health or serious financial hardship, but it generally incurs tax penalties and should be carefully considered. Pension regulations aim to ensure that pension savings are primarily used to provide income during retirement.
Yes, you can make additional contributions to your pension plan, subject to certain limits and tax advantages. Additional contributions, often referred to as voluntary contributions or top-ups, can help boost your retirement savings.
You can contribute to your workplace pension or set up a personal pension plan like a SIPP for more flexibility. Be aware of annual and lifetime contribution limits and consider seeking advice from a financial advisor to make informed decisions about increasing your pension savings.
Withdrawing pension funds before the minimum retirement age typically incurs significant penalties in the UK. These penalties include income tax charges and potential loss of tax benefits.
It's essential to understand the consequences of early withdrawal and explore alternative financial options if you need funds before retirement age.
Exceptions may apply in cases of ill health or specific types of pensions, so it's advisable to consult with a financial advisor or pension provider to explore your options and avoid unnecessary penalties.
Final Thoughts
For almost everybody, the provision of the State Pension is not going to be enough to fund your living costs when you retire – and that is part of the reason why employers are required to auto-enrol you in a pension scheme when you start working with them.
However, a personal pension scheme is one of the best ways to ensure that not only are you able to save and invest for your retirement, but that you are able to consolidate your existing pensions into one more easily manageable fund. The ability to control your own investments to align with your financial goals is another tipping point for individuals.
The UK private pension companies list above is a good starting point when researching providers. Remember though that choosing the right pension provider should be based on your investment goals, your investment knowledge and how much you want to retire with – but also on how much it will cost, and how flexible the contributions can be.