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5 DIY pensions we like

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A SIPP is a self-invested personal pension. These pension products typically offer online access, transparent charges, a choice on where you can invest your pension money, and regular statements you might actually understand! You can set one up with a computer, a debit card and 15 minutes to spare.

Our picks

Here are 5 different options which will suit a variety of savers with differing levels of confidence:

A low-cost ‘ready-made’ pension

I suggest AJ Bell Youinvest, which won Best Online Pension Provider AND Best Online Investing Platform at the Consumer Investment Awards in June. You may recognise it from the telly. This Manchester based firm, well-recognised by financial advisers as a pensions expert, has a good culture and ethos. It’s not the slickest online experience, but the charges are very competitive.

Fees:

  • 0.5% a year for the in-house passive funds.
  • This is a special introductory rate that expires in January 2019.
  • After that you’ll have to pay another standard 0.25% admin fee on top.
  • For a £50,000 pension that’s £250 a year in fees before 2019, increasing to £375 a year thereafter.

A newer firm with a simple digital approach

Nutmeg is a so-called ‘robo adviser’ (and one of our Best Buys) that aims to do the hard work of finding the right investment for you. You answer the straightforward set-up questions and you will be allocated to the portfolio (or bundle of investments) that the group’s behind-the-scenes elves think is suitable for your needs. This is a safe and easy path for people who want to ‘set and forget’ their pension savings.

Fees:

  • For a £50,000 pension, 0.75%, with the investment fund costs on top (around 0.3%).
  • That’s £525 a year.

The Establishment

Aviva will suit more cautious people who value the comfort of a large, household name. Choose from one of 4 ready-made pension funds. The website needs improvement but is fairly straightforward to navigate.

Fees:

  • 0.40% for the pension admin 
  • Plus 0.35% for one of their ‘ready-made’ growth funds
  • Total cost of 0.75% for the lot
  • For a £50,000 pension, £375 a year.
  • Costs will increase if you select from the broader range of funds.

Control for the more curious investor

If you want to choose your funds as well as some shares or investment trusts, Hargreaves Lansdown is a good service. It’s one of our Best Buys and it won Best Communication in Pensions at the Awards. It’s not the cheapest, but the people on the phones know their stuff and can help you.

Fees:

  • For a £50,000 pension, 0.45%.
  • Plus the cost of funds on top.
  • Build your own portfolio of funds which will add about 0.75% a year.
  • Or for a lower-cost ‘ready-made’ fund like one of the Vanguard LifeStrategy range add 0.22%.
  • Costs will be about £335 a year for £50k.
  • To choose and trade funds, making active selections, would cost circa 1.2% a year.
  • That’s £600 a year all-in for £50k.

The Complicated Stuff

James Hay is worth a look for bigger portfolios and complex investments. Normally used by financial advisers, these guys are SIPP experts.  If you are keen on a SIPP, know your ETFs from your OEICs and have a commercial property to add to the mix – dive in!

Fees:

  • 0.25% for pension admin
  • Extra annual fee of £179 for portfolios of less than £200k
  • Extra charges based on activity on the account
  • Plus charges for underlying investments

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