Standard Life Pension Review

as of 09/03/2021 at 11:08 am

Our View

A big name almost synonymous with pensions – solid and reliable. Not the best digital experience but from the pack of traditional players they are amongst the best. No gimmicks, few frills, but solid. This doesn’t compete with other investment providers in terms of info and research for the more enthusiastic investor. Where it comes into its own is for those who feel less certain and want a simple offer from a big name.

Our Pension Rating

Recommended For

Beginner Investor

In a nutshell

Big, secure company

Easy option funds available

Easy to use website

You Say

Your overall rating

Based on 56 reviews

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What to Expect

Investment Choice

Products

Stocks and Shares ISA

Junior ISA

Investment Account

Pension

Investments available

Own brand funds

Funds from other groups

Investment help

Robo advice / ready-made portfolios

Includes a shortlist of investments

Pick your own funds

Drawdown

Convenience and reasonable fees come top for reasons for choosing Standard Life for drawdown. Despite a lot of admin initially, overall it’s easy to set up. Some highlight that their systems can be a bit clunky, but for the most part meets their needs.

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The 'Geeky' Details

Provider details

Standard Life is a big brand player with a relatively simple service to get less confident savers up and running. Standard Life offers a Self-Invested Personal Pension (SIPP) with access to hundreds of pension funds from leading fund managers, as well as thousands of mutual funds and stocks & shares. Lots of different investment options to choose from! You do have to commit to contributing a minimum of £240 a month into your SIPP however. They also offer a free income report (in 5 minutes) for those who are thinking of retiring soon.

Charges vary depending on the “level” of investment that you choose. There are three different levels ranging from keeping things simple (the cheapest) to a wider range of investment options, suited to more experience investors. Obviously, Level 3 comes with higher charges.

When it comes to drawdown options and costs there is a yearly charge of £158 applied to those in Level 3.

In summary, a solid and respected service that lacks the pizzazz of its more contemporary counterparts.

Important Facts & Figures

Provider Size:

Large firm: manages £bns on behalf of investors and financial advisers

Minimum amounts: £2400 minimum initial amount, unless contributing monthly
£240 minimum monthly amount

Your Questions

"My husband and I are in our mid-30s and are completely new to investing. We have over £100,000 split between our two cash ISAs. As we are intending on purchasing a house in the next 5 years, the majority of our savings will be used for a deposit. However, we would like to make a long term investment (minimum 10 years), so are intending on putting £10,000 each in a Stocks and Shares ISA, as well as an ongoing £500 each a month. We're happy with some risk i.e. 6-7/10. Whilst we know this might be a tad trickier, we're really keen on investing in ESG funds/companies only. As we'll have a Stocks and Shares ISA each, we're not sure how best to 'diversify' and whether that's even possible given we want to make ethical investments? Would it be better if one of us uses a robo-adviser and the other a traditional platform? For one to go for an active and the other a passive approach (although I'm not sure if there is an ethical index)? Should one go higher risk than the other? Any guidance would be appreciated, Emma"

Emma, Herefordshire

13/06/2019

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"Hello Holly, I retired in December 2018. Just before that time, I attended the free Pension Wise meeting and also a Standard Life 'introduction to retirement' seminar. Both were very worthwhile and informative. My initial thoughts were to consolidate my pensions into the Standard Life Active Retirement pension for income drawdown which looked simple and straightforward, but it meant handing over management of the investments. However, after viewing the performance of the funds they invest in, I hesitated. I have since spoken to a number of financial advisers, but have received mixed feedback about what I should do at retirement. More recently I spoke to an advisers aligned to the investment philosophy of Albion Strategic Consulting headed by Tim Hale. I found them transparent, but as the investment philosophy is towards indexing funds, I have been scared off once again by the messages regarding DIY investor dealing with re-balancing, sequencing, and lack of ability to stress test without the correct professional financial software, in addition to the high costs. With fees of around 1.6% per annum plus the initial one off fee. Over a 25-30 year lifespan, the costs would be more than 50% of our initial investment value. Is this logical for what is an indexing strategy? In addition, looking at another of the fifty or so boutique advisers who also promote the Albion strategy towards total Wealth Management, and low cost indexing funds. The particular company concerned state on their website/in their brochure that 90% of independent or tied advisers are still working with a broken system. I really don't know what they mean by such a statement. This makes me more concerned about handing over the control, although I know retirement can be a complex time regarding finances. Each of these IFA's are Chartered Financial Advisers whom have studied to high standards, and whilst I respect their knowledge and capability, I cannot see how these kinds of costs can be recouped with a passive strategy over time. The industry is sending out very unbalanced messages to basic investors such as myself. I understand the basics, but am now totally unsettled as to the direction I should take and if, at such a critical stage, I should invest in an IFA on a regular basis. I have started to read Tim Hales book "Smarter Investing". I also understand Vanguard are introducing a drawdown pension in the coming months. For your information, I have approx. £600k in total pensions with Aviva and Standard Life, plus £300,000 in ISAs with Hargreaves Lansdown, in one of their multi manager portfolios which again have the higher charges attached due to their structure (I do think HL are a great company though). We also own our own property at approx. £600k. Our basic overhead costs in retirement are covered by current final salary pensions, and state pensions. I appreciate you cannot give me direct financial advise but I am finding the whole event very disconcerting, when I thought I had the basic acumen to manage the transition. Would appreciate your feedback. A great website by the way, Holly."

Rob, Hertfordshire

20/03/2019

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