Personal pensions: retire in style

Take charge of your future with a personal pension plan. Your future self will thank you.

Personal pensions

Best personal pensions

Let the experts grow your pension over time. Plus you’ll get a 25% bonus from the government to help save for your future. Here’s our top picks.

PensionBee logo
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Best overall

PensionBee simplifies your pension. Let them handle everything – you just watch your money grow within a 5 star rated app. Highly recommended.

Visit PensionBee¹

Capital at risk.

Moneyfarm logo
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Free advice

Moneyfarm's experts work with you to decide the best plan for your pension, and then do all the hard work for you too. There's a 5 star rated app to track your pension and the customer service is excellent.

Visit Moneyfarm¹

Compare personal pensions

Personal pension options

Expert-managed personal pension

Expert-managed personal pension

Let the experts do all the work – sit back, relax and watch your pension grow. You’ll get a 25% bonus from the government too.

Self-invested personal pension (SIPP)

Self-invested personal pension (SIPP)

Take control of your pension. You decide which investments to make. You’ll get a 25% government bonus too.

Other types of pensions

State pension

State pension

Set up by the Government. When you reach 66 years old, you’ll get up to £185.15 per week. You might struggle to live on just this.

Workplace pension

Workplace pension

Set up by your employer. If you’re employed, you’ll probably have a workplace pension.

Compare personal pensions

Pensions managed by experts

Let the experts do all the work – sit back, relax and watch your pension grow.

To help you decide, we’ve put together the average rating from Google, Apple, Trustpilot and ourselves. Our own rating is based on our own research and experience.

Avg. customer rating
4.9 out of 5 stars
Our rating
5 out of 5 stars
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Best overall
Visit PensionBee¹
More info
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Let your pension worries disappear. PensionBee simplifies your pension – they move all your previous pensions into one easy to use platform, with one annual fee, simple fund choice and great customer service. You can start a new pension if you’re self-employed too. Here's our PensionBee review.

Avg. customer rating
4.6 out of 5 stars
Our rating
5 out of 5 stars
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Easy to use
Visit Penfold¹
More info
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Penfold makes growing your pension as easy as storing money under your bed. If you’re self-employed, this is the pension provider for you, and even if you’re employed, it’s great to combine all your old pensions into one place. Here's our Penfold review.

Avg. customer rating
4.6 out of 5 stars
Our rating
5 out of 5 stars
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Free expert advice
Visit Moneyfarm¹
More info
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Moneyfarm is like a financial advisor on your phone (or website), their experts will work with you to determine the best investment strategy. It’s low cost, with an excellent investment track record and great customer service. Here's our Moneyfarm review.

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4.5 out of 5 stars
Our rating
4 out of 5 stars
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Easy to use
Visit Wealthify
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Wealthify is a simple straightforward pension, with one low annual fee. Experts manage your pension for you, and the customer service is excellent.

Avg. customer rating
4.3 out of 5 stars
Our rating
4 out of 5 stars
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Easy to use
Visit Nutmeg¹
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Want to save for the future and make your money work for you, but not sure how? Nutmeg could be for you. They handle all the investing for you – you just sit back and watch your money grow, whenever and wherever you like. Here's our Nutmeg review.

Avg. customer rating
3.9 out of 5 stars
Our rating
2 out of 5 stars
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Expensive
Visit Aviva
More info
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Aviva are a traditional pension company. If you've got a workplace pension, it might be with Aviva. They're a large company who hide fees, are not transparent with the performance of your pension, and customer service is very poor. A very outdated pension provider.

Avg. customer rating
3.6 out of 5 stars
Our rating
2 out of 5 stars
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Expensive
Visit Standard Life
More info
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Standard Life have been around for years and years but have not modernised too well. Very traditional, and large company, with poor customer service, hidden fees, and lack of transparency over your money.

Avg. customer rating
3.1 out of 5 stars
Our rating
3 out of 5 stars
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Free expert advice
Visit Bestinvest¹
More info
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Bestinvest offer a pension with the choice of either experts managing your money, or managing it yourself. You can get free advice from their financial coaches to help plan your pension. The annual charge is low, but you'll pay more hidden fees within the investments themselves, which can be high. There's a good mobile app to track your pension too.

Avg. customer rating
2.6 out of 5 stars
Our rating
2 out of 5 stars
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Easy to use
Visit Evestor
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Evestor is a new company – it's trying to be super simple and low cost, but doesn't yet compare with the others in this table. The customer service is poor too.

Pensions managed by you (SIPP)

Take control of your pension. You decide which investments to make with a self-invested personal pension.

Avg. customer rating
4.6 out of 5 stars
Our rating
5 out of 5 stars
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Best overall
Visit Freetrade¹
More info
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Buy shares and funds for free! Leave the oldies stuck in their ways with their expensive banks and brokers. Freetrade is the modern way to invest your money – all done on an awesome app. An SIPP is £9.99 per month rather than a fixed percentage, so costs don't increase as your pension grows, and theres no charges for making investments – making it cheap overall. And there's a big range of investment options. Here's our Freetrade review.

Avg. customer rating
4.4 out of 5 stars
Our rating
4 out of 5 stars
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Best traditional
Visit AJ Bell
More info
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AJ Bell are a more old school broker, with good customer service and solid reputation. They're the cheapest of all the traditional brokers, with the lowest account fee of 0.25% per year. There's also fees to trade however (£1.50 for funds and £9.95 for shares). And there's a phone app. Overall, a good choice.

Avg. customer rating
4.3 out of 5 stars
Our rating
3 out of 5 stars
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Good
Visit Fidelity
More info
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Fidelity is a traditional investment company with a solid history and great service. SIPPs fees start at 0.35% per year (and reduce), and £10 per share trade – so average for costs. An OK range of investment options.

Avg. customer rating
3.8 out of 5 stars
Our rating
5 out of 5 stars
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Flat monthly fee
Interactive Investor
More info
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Interactive Investor is a modern broker with a huge range of investment options. It has a great website and app to manage your money, and great customer service. It's a flat monthly fee of £12.99 for an SIPP, rather than a fixed percentage of your investments – which can make it cheaper than traditional options, but there's still a charge per trade (£7.99). Overall a good option for your pension.

Avg. customer rating
3.8 out of 5 stars
Our rating
2 out of 5 stars
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Expensive
Hargreaves Lansdown¹
More info
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Hargreaves Lansdown is a very traditional broker, and very expensive. An SIPP costs 0.45% per year, and £11.95 per trade. A good reputation and customer service but you're paying a lot for it. Here's our Hargreaves Lansdown review.

Avg. customer rating
3.5 out of 5 stars
Our rating
4 out of 5 stars
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Low cost
Visit Vanguard
More info
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Vanguard is very cheap compared to traditional options, with an annual fee of just 0.15%, capped at £375 per year. You can only buy Vanguard funds however, so a limited range, but their funds are very popular. A good option for less active investors.

Avg. customer rating
3.1 out of 5 stars
Our rating
3 out of 5 stars
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Free expert advice
Visit Bestinvest¹
More info
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Bestinvest is great for those a bit less confident. There's good support with a free financial coach, but the range of investments is limited compared to bigger brokers. There's a 0.40% annual fee for SIPPs (min £120), and a charge for share purchases (£4.95). There's a mobile app too.

Learn more about pensions

What is a personal pension?

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A personal pension is a pension set up by you, rather than the government (called the state pension), or your employer (called a workplace pension).

What is a personal pension?

It’s a pension that's all in your name, and it’s all your money. You decide who your pension is with and how much you put in.

It works similar to a pension you might have from your workplace, and technically a personal pension and a workplace pension are both types of private pensions. They’re all yours – and if you pass away, they’ll be passed onto your family (or next of kin).

Whereas the state pension is a public pension, as it’s provided by the government (a public service), and if you pass away, it probably won’t be passed onto your family.

And with a personal pension, unlike a workplace pension, where your employer decides everything, you get full control over where and how your pension is managed. Don’t worry, it’s simple and you can let the experts handle everything, you just get the choice of which pension company you use, called a pension provider.

As you decide the provider, that means you can shop around for the best rates (lowest fees), and best investment performance (looking at previous performance). Or, you might like a provider with a great phone app, or expert advisors there if you need them. The choice is yours!

And if you’re more experienced, you can open a self-invested personal pension (SIPP), where you can make the investment decisions for yourself too, and buy and sell investments. Here’s the best SIPPs.

Best of all, with all personal pensions, you’ll get a bonus from the government, which starts at 25% of what you put in. More on this below!

What’s the government bonus all about?

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With a personal pension, you’ll get a bonus from the government – a massive 25% top-up on what you put in.

This top-up is intended to reimburse the amount of tax you’ve already paid – as paying into your pension is intended to be tax free.

Personal pension tax relief

Why tax free? Well, the government want people to save as much as they can for their retirement, as the state pension is probably not going to be enough for people to live on just by itself any more.

If you’re a higher rate tax payer (meaning you earn more than £50,270), you’ll actually get 40% back (but only on the amount you pay 40% tax on), and the same if you’re an additional rate taxpayer, getting 45% back. Winning!

With the 25% bonus, your pension provider (the company who is looking after your pension), will automatically claim this bonus from the government and add it on to your balance.

With higher rate (40%) and additional rate (45%) taxpayers, you’ll claim this each year as part of your self-assessment tax return – which is an online form you can fill out after each tax year (which ends of April 5th every year), telling the government you’ve been paying into a personal pension and would like to claim your tax back (your pension bonus).

This is different to a workplace pension (the pension set up by your employer). With a workplace pension, first, your money goes into your pension before you pay tax, then the tax is deducted from what is left over. So, you haven’t actually paid any tax on the money you’re paying into your pension. It’s all handled by your employer.

Workplace pension tax relief

However, with a personal pension, you’re using money that you’ve already paid tax on (e.g. your salary after you’ve paid tax), and so you get the amount you’d paid in tax, back as a bonus.

It sounds confusing but it’s really quite simple, you just get your tax back on the amount you pay in!

How much can I pay into a personal pension?

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You can actually pay as much as you like into your personal pension, however, there are limits on how much you can claim the tax benefits on (i.e. the juicy 25% bonus from the government). More on those limits below.

Personal pension tax-free limits

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If you’re lucky enough to have lots of cash burning a hole in your pocket, you might want to pay as much as possible into your pension to benefit from the government bonus. But, there are limits on the amount you can pay into your pension and still claim the bonus (tax back). Which are:

  • 100% of your income per year, or
  • A maximum of £40,000 paid in per year
  • £1,073,100 paid into your pension over the course of your lifetime

These limits could change over time, and all the latest limits can be found on the gov.uk website.

What’s the difference between a personal pension and private pension?

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A private pension is a pension that’s in your name, and that you contribute to yourself. For instance a workplace pension, that’s set up by your employer, but it’s all yours and you’ll contribute to it through your salary.

A personal pension is a type of private pension, it’s just like a workplace pension, except you set it up yourself, and can move it around and contribute however much you like! It’s a great way to increase your retirement savings in addition to a workplace pension.

The state pension is a bit different, this is the pension you’ll get from the government when you turn 66. This is also called a public pension. You don’t have much control over it, and the government can make changes if they like. Whereas a private pension is more like a savings account, it’s all yours!

State Pension age

What’s a self-invested personal pension? (SIPP)

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A self-invested personal pension (SIPP) is a pension you can easily set up yourself, and it gives you the ability to invest your money however you like. 

What is a SIPP?

So you could buy shares of a specific company, such as Google or Amazon, or you could invest in specific investment funds (groups of investments packaged together) that you like. 

You’ll still get the government bonus too – a 25% top-up of whatever you pay into your account (and 40% if you’ve paid higher rate tax on some of your income).

We recommend SIPPs for more experienced investors as you’ll need a solid investment strategy to outperform the experts at other pension providers. But if you think it’s for you, check out our recommended SIPPs.

However, if you’re new to pensions and investing, start with a personal pension managed by the experts, such as PensionBee¹. You can always start an SIPP later!

Self-employed? Here’s the best personal pension for you

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If you’re self-employed, you’ve got lots of benefits – like being your own boss, and choosing your own hours! But when it comes to pensions, you don’t have an employer to set up a pension for you (actually the only good bit about an employer setting up your pension is that they have to add at least 3% into it themselves by law).

In general, personal pensions are far better than workplace pensions. You get to decide which pension provider you want to use, so you can shop around for the best rates (lowest fees), and best investment performance (in previous years) – and a provider with a phone app, or expert advisors ready to answer your questions. The choice is yours!

The only downside is you don’t get the contributions from your employer. But you’ll still get the government bonus, starting at 25% of what you put into your pension.

So, to set up your pension, you’ll have to choose a personal pension provider and set it up yourself (it’s easy, really!).

Your best option is to go with a personal pension managed by the experts. The experts will handle everything for you, just like a pension you’d have if you were employed.

All you need to do is add cash, and you’ve got the flexibility to make contributions whenever and for however much you’d like to.

Our recommended options are in the personal pension comparison table above. And our top pick for those self-employed is PensionBee¹ – they’re 5 star rated, and you can get £50 free when you sign up too!

How to set up a personal pension

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Pensions might seem complicated, but they’re actually really simple these days.

The hardest part is finding the right pension company for you, but luckily we’re here to help and have done the hard work for you and researched and reviewed the best – all in the personal pensions table above.

How to set up a personal pension

Once you’ve found one you like and signed up, it’s all over to them. They’ll handle everything for you, that’s transferring existing pensions over if you have them, to setting up any regular payments you’d like to make.

You’ll normally have to choose how you’d like your money invested, for instance if you’d only like ethical investments (so no oil or gas companies for instance), but they’ll help you with this too.

They’ll even collect the government bonus for you – that’s the 25% you get free on everything you put into your pension.

So really, all you need to do is put your feet up, add to it regularly if you can, and watch your pension grow over time.

Is my money safe?

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Yep. Pensions are heavily regulated (protected), by the Financial Conduct Authority (FCA), and your money is protected with the Financial Services Compensation Scheme (FSCS).

The FCA makes sure pension providers are treating customers properly and fairly, and the compensation scheme means should a personal pension company (provider) go out of business (which is extremely unlikely), that you’ll get all your money back.

An SIPP is slightly different, where you are protected up to £85,000, if the pension company goes out of business. But most of your money would actually be stored in the investments themselves, which are separate to the pension company, so you’d get all of these back.

And if you believe a pension company or financial advisor has given you bad advice, you can also make a compensation claim for up to £85,000.

So rest assured, your money within a pension is very well protected. But remember, the value of your investments and pension value can rise and fall over time.

When can you access your pension cash?

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You’ll be able to access your personal pension much earlier than your state pension (which is from age 66). From 55 you can access your personal pension, but it’ll be 57 from 2028, unless you are diagnosed as terminally ill, then you can access it immediately.

Turn 55 and withdraw 25% from your pension tax-free

When you’re able to access it, you can take up to 25% completely tax-free! The rest may be taxable, depending on how much income you are getting, so you might want to wait until you officially retire before you think about taking the cash, so you reduce the amount of tax paid overall. Here’s more information on pensions and taxes.

What happens to my personal pension when I die?

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With a personal pension, as it’s all your cash (and not the government's cash like the state pension), it will pass to your next of kin or someone you specify with your pension provider. It’s not lost forever.

What happens to my pension when I die?

Here’s more information on what happens to your pension when you die.

SIPP vs personal pension

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A self-invested personal pension (SIPP) is where you decide where your money is invested, and you buy and sell these investments yourself, through your pension account.

What is a SIPP?

Whereas a typical personal pension is where experts make all the decisions for you. You don’t need to lift a finger, just sit back, let them do work, while you watch your pension grow over time.

SIPPs are more flexible as you have more investment options, but they’re suited to experienced investors with a solid investment strategy. And often already have a personal pension managed by the experts, but want to add a few extra investments on top.

If you’re new to pensions, we’ve got our recommended providers above.

Can I have a personal pension and a workplace pension?

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Yep! And it’s highly recommended, and very common.

A workplace pension is set up by your employer and it’s their choice who they decide your pension is with (and often not the best choice, with expensive fees and poor performance).

With a personal pension, you have control over who your pension is with, and can transfer to another company whenever you like. So you can choose a pension provider with low fees, good performance and perhaps have a great phone app that allows you to track your pension whenever you like.

You’ll also get all the same benefits as a workplace pension, such as tax-free contributions thanks to the government bonus, but you won’t get the employer contributions (which your employer is forced to make by law, and is a minimum of 3%).

If you’re lucky and have an employer who matches your contributions up to a certain point, it’s often better to pay into your workplace pension up until the point where your employer no longer matches your contributions (which is basically free money).

And after that point start paying into your own personal pension instead, to benefit from potential cheaper fees, better performance and more control over your money.

Pension articles

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