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After a decades-long day at the office, the time will come when you can hang up your hat, put your feet up, and get ready for retirement. But you'll need retirement savings to live comfortably in your relaxed stage of life.

Pension schemes are an excellent way to ensure you have enough to cover your lifestyle as you get older. Many businesses offer pension scheme opportunities as employee benefits. But, sometimes you need to make your own plans for pension schemes.


Pension Provider

So, how can you find a self-invested personal pension that suits you? Keep reading as we discuss the best personal pension providers, and all the pros and cons you need to know!

Table of Contents:


Our Top Pick of Pension Providers (UK) 🇬🇧

First, what is a pension? 

We’re talking about ‘personal’ or ‘private’ pensions here. A personal pension pot is a great way to establish life savings. Doing so explicitly for retirement can give you special privileges. But there is a risk of loss. 

But don’t let the name ‘private pension’ hypnotise you. We’re talking about money investments with special tax breaks. There are no guarantees. Here are some critical things about the top pension providers…

  • The pension age is currently 66 years for UK men and women.
  • You can go via your employer or still get up to 25% tax relief privately.
  • 🌞 A top investment for retirement is in living things that grow: food, families, and local communities – while avoiding fear.

Top Best Pension Providers – Reviews 2024 📘

Service ProviderRating
1. Halifax★★★★★Open Account
2. Hargreaves Lansdown★★★★★Open Account
3. Vanguard★★★★Open Account
4. Wealthify★★★★Open Account


1. Halifax Portfolio – Overall Best Pension Providers Choice

Now you know what a pension is and isn’t today, let’s look at our leading provider… As a central bank, Halifax offers a range of ‘retirement’ funds. 

Primarily, they do this via their multi-asset Portfolios product, featuring a basket of assets that the bank manages as a collection or individually.

Halifax’s ‘Pension Portfolios’ is a means for people to invest in more than just one investment type. The financial name for these is ‘multi-asset funds’.

Halifax offers you non-workplace pension options. Each retirement portfolio places different combinations of investment types to produce different possible returns. They base this on the amount of risk you can tolerate:

  • Cautious
  • Balanced 
  • or Adventurous

About 📙

Halifax is one of the largest banks in the UK and provides banking services to customers in Scotland, England and Wales. The Halifax brand is both a retail high-street bank and a large financial service. 

Because Halifax is a multifaceted bank, it offers a range of financial products and services to individuals, businesses and charities – including mortgages, savings products, credit cards and loans. Its service area also includes a bank account and mortgage. 

Reputation for Customer Service 

Halifax has a range of financial advice partnerships, including with Barclays Wealth, HSBC, Ascot and others – a large ecosystem of financial resources. 

Indeed, you can access a range of financial advice for free, including budgeting and debt reduction advice, and you may be able to receive guidance with your current account. 

You can access basic advice if you have a mortgage or loan with Halifax. If you have a savings or investment account, you can access some financial advice, including tax advice. Halifax is a leading option if you’re looking for a bank with a wide range of financial products and services, a large network of branches, and an easy-to-navigate website.

PROS

  • Fully-formed bank & financial services provider
  • Offers financial advice
  • Products optimised for retirement and risk appetite

CONS

  • No obligation to provide a guaranteed retirement plan; you take on all of the risk

2. Hargreaves Lansdown – Well-Rated Top Pension Provider

Hargreaves Lansdown, based in London and founded in 1966, is a specialist financial services giant. 

It offers various services, including custodian and trustee services and retirement solutions.

These various investment funds can be used to fund a retirement income plan known as a pension or as an individual savings account known as a ‘personal pension’.

About 📙

Hargreaves Lansdown is a financial services company that offers a range of services to help people save for retirement with a pension pot and non-workplace pensions. The company is a member of the Hargreaves Lansdown Group. The company has over 1,600 employees and operates in 22 countries. 

It’s also a member of The BUPA Investment Management Company and the FCA (Financial Conduct Authority) and is subject to several regulatory standards. 

Solid User Reviews

While Trustpilot may not be so trustworthy, it’s worth noting that they have a generally solid reputation for providing retail financial services. Just keep in mind that, today, the financial world is very topsy-turvy and it’s hard to depend on any source for guidance. 

Here are two noteworthy types of investment funds:

  • Standard investment funds – These are entry-level private pensions and offer a range of investments; traditional investment funds also have low management charges.
  • Managed – These are more expensive than standard investment funds but aim to have higher returns. These funds are managed by Hargreaves Lansdown and typically include a range of risk and return options for your pension contributions. They also supposedly have a high degree of flexibility and can be customised to suit a variety of investment objectives.

PROS

  • Based in London and founded in 1966
  • Provides financial advice
  • Offers managed products optimised for long-term holdings

CONS

  • Risk of loss - this provider is not obligated to guarantee returns

3. Vanguard – Stable Top Pension Provider

Vanguard retirement plans let you invest savings into various stock market indexes.

These are the same investments used in giant banks like Chase or Wells Fargo.  

When you open a Vanguard retirement plan account, you can invest that money into one of Vanguard’s retirement plan options, which may include: the S&P 500, a small percentage into bonds, and global stock markets.

About 📙

Vanguard was founded in 1975 by William A. Feagh and Alfred J. Marrow. The company went public in 1983 and quickly became one of the largest brokerage and investment management firms in the world. 

Vanguard has continued to grow and now operates in over 30 countries. Vanguard is a mutual fund company that offers three different staple plans:

  • Total
  • Retirement
  • Aggressive

The Vanguard Total Stock Market Index Fund is the basic option for most people. The Target Retirement Fund is designed for people near retirement with a relatively short investment horizon. And the Aggressive Investors Fund is meant for people with a longer investment horizon. 

Corporate-owned and -operated, Vanguard is headquartered in Valley Forge, Pennsylvania. The company has over 10,000 employees at dozens of locations across the United States, Puerto Rico, and overseas.

If you choose a Vanguard retirement plan that invests in stocks, you’ll be splitting your funds into two parts. One will be the underlying stocks in the S&P 500 that you’ll be able to see on the Bloomberg terminal. The other will be the management fees that Vanguard charges. This can be a little bit of a surprise to a lot of people, though you do get some benefits by choosing a Vanguard retirement plan like this. 

Low Fees

The management fees are pretty standard, meaning you won’t be getting ripped off by some shady broker that wants to take a bunch of fees off the top of your pension fund. 

These are charged at the end of the year, meaning you won’t have to worry about not seeing the fees for a few months straight. This does make the investment a bit less exciting since you don’t have to watch the growth of your portfolio. 

Overall, costs are low, and it’s worth considering the benefits of the low fees. If you pick the Total Stock Market Index Fund Target Retirement Fund, you’re allegedly only paying under a tenner per year. So it’s not hard to see why that’s worth a shot.

PROS

  • Handy if you don’t have the time or interest to research different companies
  • Strong track-record
  • Overall low fees

CONS

  • While holdings aim to outperform the market, you are overall responsible for keeping your savings in good order

4. Wealthify – Modernised Pension Provider

Wealthify is a digital wealth manager that has steadily grown since its launch in 2016. They are reliable private pension providers in the UK.

It’s no secret that Brits face a rising tide of financial uncertainty. Many people feel the pinch from rising gas prices, higher property taxes and an unstable stock market. Additionally, wages have remained stagnant for more than a decade.

Wealthify is designed to help people hold more money and savings. For this, it created a retirement portfolio feature that supposedly makes managing your retirement more efficient and less stressful. If you are already investing your money, it may make sense to use Wealthify to take some of the burdens off your shoulders. If you are trying to get on track with your retirement savings, it may also make sense for you.

About 📙

Wealthify was created by two former Goldman Sachs bankers with an insatiable appetite for data analysis and an innate understanding of human behaviour and psychology. They wanted to create an app that would manage the money of increasingly sceptical clients while still creating long-term value for their investors. 

It is built on the premise that people have different risk tolerances and investment styles than traditional financial institutions cater for – designed to help manage the risk associated with each investment and keep track of your net worth – to be the ideal tool for millennials. 

Reasons to Use 

At its core, Wealthify is a digital financial advisor. It helps investors identify their goals and find investments that are most suitable for them. 

Who uses Wealthify? Millennials are the largest generation in many countries and also the most financially anxious generation in history. Many millennials don’t trust any financial institution, and almost a quarter of them would rather skip making private pension contributions than consider the possibility.

Advantages:

  • Free – Wealthify is free to download and use. 
  • Accessible – It is accessible on any computer, tablet, or smartphone. 
  • Data-Driven – It makes recommendations based on your risk profile, age, and income level. It also uses data to provide you with a recommended portfolio. 
  • Portfolio Tracking – Wealthify tracks the investments in your portfolio and provides you with updates on the performance of each one.
  • Investment Advice – Wealthify advises managing your money so you don’t have to reinvent the wheel.

PROS

  • Wealthify is free to download and start trading on
  • Wealthify is all about using data to inform your investment decisions
  • Portfolio tracking

CONS

  • Not a financial advisor - and once again, you are responsible for keeping your savings in order

Best Pension Providers – Buying Guide 💷

This lightning section is designed to give you a basic beginner’s understanding of pensions and how they work – before you proceed with your chosen pension provider.


What is a Pension?

A pension is money you earn from a regular source during retirement. It’s a steady income you can count on for your retirement. 

In return, you get a guaranteed income for life. It’s most commonly associated with people in their 60s (the retirement age is 66) who are collecting a few years of a steady income before they retire.

But the fact is that most people collect monthly pensions from age 55 on. And many people continue working well into their 70s. As a result, there is a growing interest in early retirement. For example, young professionals could retire early because they could count on a monthly income while they are still productive. 


Pension

Similarly, those close to retirement might want to retire early because they could live off their pension for a few years before they have to return to work.

How a Pension Works

As stated earlier, you and your employer contribute to a pension plan. You both contribute a set amount each year.

Your contribution amount is based on your income, job title, and other factors. For example, suppose you are in the middle-income bracket and work in the high-paying corporate sector. In that case, you’d contribute roughly twice as much to your pension as someone in the lowest income bracket, also in the corporate sector.



Pension

The pension plan provider then invests the money you and your employer have contributed. This provider invests the money in various ways, including through equity funds, fixed-income funds, real estate funds, and private equity funds. As the money grows, the plan provider invests it.

As it grows, you get a monthly pension check. The size of your monthly pension check will depend on the plan provider, your contribution, and the current market prices of the funds. In other words, it will depend on the plan's investment returns.


Why Have a Pension?

If people were to retire at their current pace, there wouldn’t be enough younger workers to support the growing demand for goods and services. That’s because many people will be retiring early.

And there’s a chance that many people who retire in the next few decades will retire early because they can no longer afford to work. With fewer people contributing to the economy, fewer goods and services will be available.

Savings

That could result in a sharp drop in living standards. The best way to avoid this scenario is to have more people contributing to the economy. The easiest way to do this is to encourage more people to join the workforce and work past retirement age.

Key perks of pension schemes:

  • ☑️ A Monthly Income – Many people opt for early retirement. There’s a good reason for this. The average retiree in the UK earns less than the average working person. Retirees have less money to go around, and they also have fewer productive years ahead of them. With that in mind, some retirees choose to retire early because they can live off their monthly pension check as is.
  • ☑️ Some Later Security – What if you are in your 60s and still want to work? Or, what if you want to work for a few years before you retire? In both scenarios, you might want to join the workforce in your 60s because you can get a monthly pension for life.
  • ☑️ Flexibility – Working past your retirement age? There’s a good chance that you will be healthier and more productive than some retirees. That means that you will earn more while in the workforce than retirees who retire early. That means that you have the flexibility to choose the amount of time you want to work. Most importantly, you can choose when you want to retire.
  • ☑️ Better Investment Returns – Many factors influence the investment returns of your pension plan. However, your age is one of them. That means you have a good chance of getting better investment returns than younger retirees.

Setting Up Pension Schemes

Before contributing to a pension plan, you must have an employer-sponsored pension plan. If your company doesn’t offer a pension plan, you can still contribute to a self-funded one.

What you’ll need to do is contribute to a pension plan. Or if your employer provides a pension plan, you’ll need to join the plan. That way, you can contribute. Once you’ve done that, you must choose a pension plan provider.

Pension Scheme

You might want to consider a self-funded pension plan because you can choose the investment returns for your pension plan. Although you might have to pay higher fees, you will have better control over the investment returns of your small and large retirement savings.

What are my options when choosing my pension? You can choose between two types of pensions: stakeholder pensions and personal pensions. Both will guarantee an income for life — but they differ in many ways:

Stakeholder Pensions

Stakeholder pensions are relatively new pensions. The government has introduced them to ensure that pensions are affordable and to make it easier for people not very experienced in financial matters to choose the right pension.

The main advantage is that stakeholder pensions are much cheaper than personal pensions – the government will pay 50% of the cost of buying your stakeholder pension.

The main disadvantage is that you will receive a smaller income from your stakeholder pension if you decide to buy one when you retire. Stakeholder pensions also tend to be more restrictive than personal pensions – for example, they do not allow you to take money out of your pension if you need it. There are limits on how much money can be taken out at any time.

Personal Pensions (Retirement Annuities)

Retirement Annuities

Retirement annuities are also known as retirement income plans and offer a guaranteed income for life. You buy an annuity by paying a lump sum into it, and the company will pay you an income every month until you die. In some cases, this could be up to 20% of the amount paid into the plan when you retire.

These have been around for many years – so they have far more flexibility than stakeholder pensions. You can withdraw money from them if needed and keep contributing until retirement age (although this will reduce the income paid out). 

The main advantage of buying an annuity is that it offers a guaranteed income for life – so it is better than putting your money into stocks and shares where there is no guarantee that you will get any return on your money. 

However, if the stock market does well, you could get more from your investment in stocks than from an annuity – although this is not always true. If a recession hits, it can be hard to get a return on your stock investment, whereas many annuities provide a guaranteed income even if there is a recession!

The main disadvantage of buying an annuity is that they are much more expensive than other types of insurance policies (although they are cheaper than they used to be). This means that if you want to make sure that you have enough money in your pension pot to pay for your retirement, then it may be cheaper to buy other types of insurance policies rather than purchasing an annuity.


FAQs

What Are Drawdowns?

To draw down from a pension fund is to withdraw money from it. The most common form of drawdown is a standard annuity, which guarantees an income for the remainder of your life. However, you can also draw down from other funds – such as pension funds, ISAs or even stocks and shares (although this is not recommended because the value of your investments can change).

What Happens To My Pension If I Die Before I Retire?

Most people assume they will die before retirement, but what happens with their pension fund? If your spouse or partner survives you, then they will be able to claim the money. If you have children, they may be able to claim it too. But if you don’t have a spouse, partner or children and die before retirement age, the money will stay with your pension provider and your estate.

I’m Self-Employed – What Are My Pension Options?

If you are self-employed, two options are available: set up a personal pension or use an umbrella company. The latter option means that all your business expenses are put through one account and paid for by the company, which means there is more chance of tax being deducted at source. You can also use an umbrella company to cover yourself against sickness and injury at work and old age (if it doesn’t already come with a personal pension).