How to Set Up Your Own Pension

Welcome to the first lesson in our 'How to set up your own pension' course! In this lesson, we're going to get straight to it and start with the big question - which pension provider should you open an account with and how do you know if they're right for you?

With most of us saving thousands if not tens of thousands of pounds in our pension pots, it’s crucial that you’re happy you’ve chosen the right home for your money! 

So what do you need to think about when deciding which pension provider to pick? Here are 5 key questions to ask yourself before you open an account.

1. Are they any good?

If you're going to trust a provider to hold the keys to your future nest egg, you want to make sure you're going with a company that's legitimate and well-liked by their customers.

But what makes a pension provider "good" is a pretty subjective question; there are some key areas you probably want to pay attention to:

Not all providers will have all of these elements and some, such as value for money, can be difficult to judge when there are dozens of companies to choose from. That's precisely where we come in, to help you sift through the mountain of information and get to the crux of the question: who is really the best pension provider in the UK?

Check out the winners of our annual Best Buy Pension award to see who came out on top in the rigorous testing by our independent analysts. We put providers through their paces on everything from cost and investment choice to customer service and real-life reviews - all to identify the best home for your retirement savings.

Click on the link below and use our winners list to narrow down your search.

2. Do you want to pick your investments yourself?

Now you've got a shortlist of the pension providers we think are the best on the market, it's time to dig a little deeper and find which one is best suited to your needs. First up, you'll need to decide whether you want to do it all yourself or if you'd prefer a provider who can pick out your investments and build a portfolio for you.

This is what a robo adviser does. These are investment providers which use AI and complex algorithms to suggest a ready-made portfolio suited to your goals, time horizons, and tolerance for risk. They can be a great choice for those who don't feel confident curating their own pension portfolio, or simply don't have the time to do all the research and stock-picking themselves. However, the choice of portfolios can be quite limited, and you may have to pay a little more for the service.

Those who want to be more involved can opt for the Do-It-Yourself (DIY) approach with a provider that lets you pick and choose what you put in your pension. Many pension providers give you access to thousands of funds, shares, Investment Trusts and other assets to choose from. This can be great for more experienced investors, but equally, so much choice can also be overwhelming! You'll also have to manage the buying, selling, and monitoring of whatever you choose to invest in all by yourself.

Note that these investment styles are not mutually exclusive and these days many providers can actually cater to both. However, it's nevertheless a useful exercise to think about how hands-on you want to be with your retirement portfolio, and how this might impact your choice of provider.

3. How much will it cost you?

Fees can be a make-or-break factor in choosing the right pension provider for you. And, unfortunately, they can be quite confusing to get your head around! Costs can vary widely depending on which one you pick, so it could – literally – save you money to shop around and find one which you consider to be most reasonable for you.

In terms of what to expect, there are generally two types of fees charged by most pension providers to keep an eye out for when calculating costs: admin fees and dealing charges.

How much do pension providers charge in fees?

This is the admin fee you pay to your provider for giving you a pension – essentially a baseline ‘thank you for your service!’ in monetary terms. This can be either a flat fee or a percentage which differs depending on the amount of money in your account. You typically pay this on an annual basis, but some providers charge monthly. Our research shows the average annual platform fee for a £100,000 pot is around 0.25%, which is equivalent to £250 per year.

Source: Boring Money Online Investing Report 2026.

What are trading fees on a pension?

Separately, trading fees are charged when you buy or sell the underlying investments within your pension. For example, when you invest in a ready-made portfolio or you trade individual shares. The cost can differ depending on the type of investment and how often you’re trading (some providers offer discounted trading fees if you set up a regular investment). It often costs about a tenner to buy a single share and buying funds is usually less expensive, but can be anywhere from entirely free to as much as £11.95 per trade.

Of course, it’s important to remember that the cheapest doesn’t always equal the best. You might find a provider that ticks all your pricing boxes but doesn’t offer the choice of investments you were hoping for. This leads us to the next consideration: investment choice.

4. Do you have enough choice?

This is especially relevant if you’ve opted for the DIY route. Are you happy with the range of investments on offer? Some providers give you access to tens of thousands of investments, but others have a more limited list. It depends whether they're "open" or "closed".

An open investment platform gives you full access to the investment market (so you could choose one of their own funds but you’re also free to pick someone else’s), whereas a closed investment platform only allows you to buy their own in-house products.

It’s worth checking to make sure if the platform you’re considering opening your account with is open or closed as this could have a huge impact on what you’re able to invest in. Vanguard, for example, is a popular pension provider but has a closed structure – so Vanguard customers can only invest in Vanguard products!

Do some research before you open an account so you don’t have to backtrack later on in the process. Moving money from provider to provider can incur charges, so it's best to be certain before you start and save yourself a headache further down the line.

5. Do they have the right access options?

Finally, this is an easily overlooked but crucial question: will you be able to draw from your pot the way you want to when you retire? There are two main ways you can access the money in your personal pension, either through drawdown or by purchasing an annuity.

Drawdown allows you to take money out of your pension pot in instalments while leaving the rest of it invested (the hope is that it will continue growing over time). This means you can decide how and when you receive your pension, but you don’t have to completely take it out of the stock market and sacrifice its potential growth either.

The alternative is to buy an annuity. This is a product which coverts the cash value of your pension into a guaranteed annual income which you receive either for a set period of time or until you die. Annuities have been less popular in recent years, but can be appealing for those who would prefer the peace of mind of locking in a guaranteed income before they retire.

In both cases, you can also take up to 25% of total value of your pot as a tax-free lump sum. More on this here.

Not all providers allow you to convert to an annuity, and equally, some won't have a drawdown facility either. It's best to have an idea of how you'd like to access your pension in case you end up needing to switch your provider if you discover they don’t offer the service you want when you need it.

Where can I compare pension providers?

So now you know the main questions you need to ask yourself when choosing the right pension provider for you. You've already checked out the winners of our coveted Best Buy Pension award, but if you want to see more, head over to our comparison table to see the full list of providers. You can compare fees, investment choice, customer reviews and more by reading our full, independent reviews.

Welcome to the second lesson in our 'How to set up your own pension' course! In this lesson, we're going to walk you through the 5 simple steps it takes to set up a pension account so you can get started with your saving.

Did you know you can open a personal pension from the comfort of your own couch? Many people don’t actually know what’s involved when it comes to opening one, and we understand it can feel like you’re being bombarded with options and buttons to click!

So, we asked Emma-Lou Montgomery, Associate Director at Fidelity, to walk us through the 5 simple steps it takes to set up your own pension online. Watch the video below, or scroll down for the summary, to find out how to get started.

5 key steps to opening a pension

If you’re ready to make a start, here’s a summary of the five questions to ask yourself before you open a pension.

1. What paperwork do I need to open a pension?

First, gather any paperwork you might need for the form-filling part of the process. This usually includes your National Insurance number, some form of ID, and your debit card or bank details. If you’re going to transfer money from other pensions into your new one, you’ll also need to have the details for those to hand as well.

2. How do I find a provider’s “open a pension” page?

Now, once you’ve chosen which provider you want to open a pension with, head over to their website and find the ‘open a pension’ page. It might also be called a ‘SIPP’ (which stands for Self-Invested Personal Pension).

3. Do I need to set up a password for my pension account?

On the ‘open a pension’ page, you’ll come across a form you need to fill in to get started. As part of the process, you need to set up an account with a username and a secure password. This is so you can login to your account and view your pension details whenever you like. Remember to choose a secure password to keep your personal information protected.

4. Do I need to choose a retirement date when opening a pension?

At this stage, most providers ask you about your timeframes and when you think you might want to retire. The better providers have calculators so you can see what changing your retirement date could mean in practice for your money – do use these if you can, as they’re helpful tools for forecasting your retirement income.

Your chosen retirement date isn’t set in stone. You can always change it at a later date, but it’s important to keep it updated if you do decide to change your plans, so you can make sure your investments stay on track to meet your needs.

5. How much money do I need to start paying into a pension?

Finally, you’ll need to decide how you want to save into your new pension. You can start with a lump sum, or you can set up a regular savings plan to automate the process. It doesn’t have to be expensive either – many providers allow you to get started from as little as £20 for a regular savings plan or just £100 for a lump sum.

And that’s it! The whole process should take you between 10-15 minutes from start to finish and larger providers will let you fund your new pension immediately using your debit card. 

Welcome to the third lesson in our 'How to set up your own pension' course! In this lesson, we're going to discuss how much money you need to save in your pension, including some handy rules of thumb you can use as a starting point for your calculations.

How much should you have in your pension to get the most out of your money? This is one of those questions that really depends on you and your unique financial circumstances.

First though, how much money will you need coming in every year to fund you retirement? Pensions UK has a handy guide to the ideal retirement income, with three tiers depending on your relationship status and your chosen lifestyle.

Retirement Living Standards 2026, Pensions UK

Source: Pensions UK, 2026.

Working out which of the above tiers you fit into is really down to you and your unique circumstances. After all, your idea of the ‘perfect’ retirement could look very different from someone else’s.

It’s a good idea to take a little while to think about what you envision doing with your time once you finish work. This will guide you towards which tier is most appropriate. At this point, you can start thinking about how much you'd need to have in your pension in total to generate that level of annual income and what you can do to make sure you're saving enough.

What are the top three best retirement saving strategies?

Having a retirement saving strategy can help you to get into a routine. You can work out how much you want to contribute and then set up a direct debit to automate the process for you, so you can just get on with the rest of your life!

Below are examples of three common rules of thumb you may want to follow. Note that there is no single right way to save for your retirement and the amount you’ll have saved up by then can be very different depending on your circumstances (e.g. your age, how much you're contributing, what you're invested in, etc).

We’ve provided some examples for each one so you can see how they might differ. These examples are all for illustrative purposes only and do not account for the State Pension as individual entitlements may differ.

1. What is the “half your age” retirement saving rule?

This retirement-saving method is fairly self-explanatory. Take your age and then half it. This is the amount of your pre-tax income you should be putting into your pension pot (including tax relief and workplace contributions of a minimum of 3%, assuming you’re employed). You adjust this accordingly for any changes to your age and income.

Example:

Emma is 30 years old. 30 ÷ 2 = 15. Emma should be saving 15% of her pre-tax income for retirement.

Emma earns £30,000. 15% of £30,000 = £4,500. Emma should save a total of £4,500 into her pension every year across both personal and workplace pension schemes.

Two years later, Emma has received a pay rise and is now earning £32,000. She is now 32 years old. 32 ÷ 2 = 16. 16% of £32,000 = £5,120. Emma should now save a total of £5,120 into her pension every year.

2. Fidelity’s 15% rule

Alternatively, Fidelity Investments has a different approach to retirement saving. It recommends you put aside 15% of your pre-tax income (again, including tax relief and employer contributions) into your pension pot every year. You adjust this accordingly for any changes to your age and income.

Example:

Manny has an annual income of £40,000. 15% of £40,000 = £6,000. Manny should save a total of £4,500 into his pension every year across both personal and workplace pension schemes.

Ten years later, Manny is now earning £60,000. 15% of £60,000 = £9,000. Manny should now save a total of £9,000 into his pension every year.

3. Saving 10x your salary - what are the milestones?

Another retirement saving rule of thumb is to save up around 10 times your average salary by the time you reach State Pension age (currently 67). To stay on track, this is further broken down into the following milestones: 1x your salary by 30; 3x your salary by 40; 6x your salary by 50; 8x your salary by 60; 10x your salary by 67.

Example:

Lisa has an average salary of £35,000. 10 x £35,000 = £350,000. Lisa would need to save at least £350,000 in to her pension by the time she turns 67.

Welcome to the fourth lesson in our 'How to set up your own pension' course! In this lesson, we're going to talk about what to actually put in your account now that you've got it all set up, with ideas for three different assets you can invest in.

Until you decide, your pension pot is just sitting there with nothing in it (and not growing)! Holly chatted again with Emma-Lou Montgomery, Associate Director at Fidelity, to discuss three options and which one might be best for you. Watch the video below or scroll down to read a summary.

What should you invest in your pension?

For beginner investors: what should I invest my pension in?

In many cases, the best – and easiest - thing for beginners is to stick with are funds. These are baskets of investments that don’t require any number-crunching on your end and, in most cases, you’ll usually have a large range to choose from if you opt for one of the main pension providers.

A multi-asset fund - which is invested in lots of different types of assets - is a particularly great way of spreading your risk without having to be a bona fide Wolf of Wall Street! Watch Holly explain more about how multi-asset funds work in the video below.

What is a multi-asset fund?

For more confident investors: can I hold individual shares in my pension?

More confident folks might prefer to stick some individual stocks and shares in their pension, where they can have more control over exactly what they’re invested in.

These don’t have to make up 100% of your pot, but you might like the idea of mixing and matching your own portfolio to suit your preferences. You basically get to be your own fund manager!

Remember that the cost of buying and selling lots of individual shares can add up (especially if you haven't set up a regular investment schedule), but assuming you’re not reorganising your entire pension portfolio every couple of days, you may find that the added cost is worth it for the greater level of personalisation. Watch Holly explain more about how shares work in the video below.

What is a share?

For sustainable investors: can I invest my pension in ethical or green funds?

A growing number of investors are curious about putting their money behind the causes that matter to them – battling climate change, ending world hunger, tackling global disease – and often, your pension provides a great opportunity to invest in these themes.

There are plenty of ways to invest sustainably, although not all pension providers will have these options. Head to their website or app and explore what “sustainable”, “ethical” or “green” funds and products they offer to get started. You may find they have a sustainable-focused ready-made portfolio, for example, which can help you get exposure to companies doing good for the planet without spending hours researching and analysing green credentials.

Note that the rise of “greenwashing” has made it more difficult to distinguish between the companies and investments that do what they say on the tin and the ones that are misleading. You’ll need to do a little bit of research to make sure you’re getting what you’re paying for. Watch the video below as Holly explains what a sustainable fund is and what you can do to check its credentials.

What is a sustainable fund?

We hope you’ve found this course helpful – wherever you are on your retirement saving journey.

If you need support on finding the right pension, check out Boring Money’s ISA and Pension Finder tool! We will sift through over 40 providers and suggest our top three picks for you.