What’s the best pension provider to transfer to?

Just switched to a new job and looking to move your old pension? Or is your current pension not performing very well? Don't worry, you're in the right place. Here’s the best pension providers to transfer to.

Best expert-managed pension providers

Where the experts handle the investments – just sit back and relax.

Best self-managed pension providers

Where you manage your own investments.

Our criteria for the best pension providers

Finding the right pension provider (a pension company) for you can be pretty tough – there’s a wide range of providers out there, different types of pensions, different pension schemes, and pension plans you choose, it can all get pretty confusing. 

But don’t worry, we’ll explain all, and we’ve researched a wide range of options to determine the best pension provider to transfer to.

Here’s what we looked at for each provider:

• Easy to transfer
• Easy to use
• Fees
• Range of investment options
• Customer service

We mentioned there’s a lot of pension providers out there. And, lot’s of different types of pensions too (covered below), but we’re just showing you the very best pensions to transfer your pension to – ones that we recommend to our friends and family (and our lovely readers of course), and use ourselves here at Nuts About Money.

That means you can be confident that whichever one of our recommendations you choose, you’ll be using one of the very best.

Your pension transfer options

When transferring your pension, there’s two main options to choose from:

• A new personal pension
• Your new workplace pension (if you’ve moved to a new job)  – this is the pension your employer sets up for you

Now, there’s one recommended option here, even though there’s two choices – and that’s transferring your pension to a personal pension – there’s loads more benefits, which we’ll cover in detail below. In short, you can benefit from low fees, and potentially, your money could grow more over time.

Don’t worry if you’re not sure what a personal pension is yet, that’s what we’re here for.

What is a personal pension?

A personal pension is a pension that you choose to set up, and you choose to add money (make contributions). It’s different from a workplace pension, also called an employer pension, which is a pension set up by your employer if you start a new job (explained below).

It’s also different from the government pension (State Pension), which you could get at State Pension age (retirement), currently 66 years old – and only if you’ve paid enough National Insurance contributions over your life (at least 10 years, but 35 years to get the full amount).

The full amount is currently £203.85 per week, so you can see why you’ll probably need your own pension too.

‍Note: both a personal pension and workplace pension are types of private pensions as they are private to you, you own them. The words 'private pension' is often used instead of 'personal pension'.

With a personal pension, you’ll get a massive 25% bonus on all of your contributions automatically (we’re not joking!). Why? This is to refund the tax you’ve paid on your income (e.g. your salary), as saving for a pension is intended to be tax-free.

And, if you’re a higher rate taxpayer (earning more than £50,270 per year, and paying 40% tax), or an additional rate taxpayer (earning more than £125,140 per year, and paying 45% tax), you can claim some of the tax paid at those rates too. You can do this on a Self Assessment tax return.

You can contribute up to your total income per year (e.g. your salary) with a maximum limit of £60,000 per tax year (April 6th to April 5th the following year). These limits are a total of all of your pensions, including workplace pensions (see below).

Note: as it's a pension, you won’t be able to access your money until you’re at least 55 years old (57 from 2028). If you want to save, but think you might want to access the money sooner, you could consider a Stocks and Shares ISA. 

Nuts About Money tip: personal pensions are a great way to boost your retirement savings, and contribute to your total pension pot – most people will likely need one to help build a hefty pension pot that we’ll need in the future – for a comfortable retirement of £37,300 per year, you’ll need a pension pot of £747,003! (on top of receiving the State Pension).

If you're young(ish), don't panic, it’s definitely possible to build up a nice big pension pot (these numbers aren't as unrealistic as you might think) – we’ll run through how below.

What happens when you retire?

When you retire (or simply decide to take the money), you’ll be able to take 25% percent of your pension completely tax-free, and you can take this as a tax-free lump sum if you like.

With the remaining 75%, you might have to pay Income Tax on. It's similar to paying tax on your salary now. How much you’ll pay will depend on your total income at the time.

You can decide to withdraw it monthly from your pension pot if you like (called pension drawdown), or you can buy an annuity, which can provide a guaranteed income for the rest of your life (or a set number of years).

Nuts About Money tip: it can be a good idea to speak to a financial advisor when you’re thinking about retiring, who can go over all your options.

Note: we’re talking about defined contribution pension schemes, where you add money and your money grows as a total pension pot figure (similar to a savings account), ready to take when you retire. The alternative is a defined benefit pension scheme, which is common in government workplaces (such as the NHS), where you receive a set income when you retire (depending on things such as how long you’ve worked there) – these can often be called a final salary pension scheme.

Types of personal pensions

There’s two different types of personal pension, a regular personal pension, with the money and pension investments managed by experts, and a personal pension, where the investments are managed by you, called a self-invested personal pension (SIPP).

Expert-managed personal pensions

These are very popular, and it’s where the experts handle everything for you – so all you need to do is add money, and that’s it, the experts take care of the pension investments and aim to grow your money sensibly over time.

You’ll also get the 25% bonus on your pension contributions automatically.

Our top recommendation is PensionBee¹ – it’s easy to use, low cost and has a great track record of growing money over time. And, they’ll be able to transfer over any existing pension(s) you might have, so you don't have pensions all over the place from different jobs.

Self-managed personal pensions

A self-managed pension, technically called a self-invested personal pension (SIPP), is where you make all the investment decisions yourself.

That’s deciding which stocks and shares you want to buy, or more commonly, which investment funds (groups of investments, such as a range of stocks and shares). An investment fund designed for long term pension growth, suited for retirement savings, is often called a pension fund.

Note: a share is where you own part of a company, you buy a ‘share’ of the company. All the shares combined equal the value of the company, which can rise and fall depending on the business’s performance.

A SIPP is a great option if you want to have more control over your pension, maybe you have a personal pension with the experts already, and want to open another one to make some of your own investments. However, they’re only recommended if you know what you’re doing when it comes to investing.

Note: technically a modern personal pension, that’s also expert-managed (such as PensionBee¹ ), is also a SIPP. There’s just a limited range of investments, or pension plans (also called pension funds) to choose from.

If you think an SIPP is for you, here’s the best SIPP providers.

Workplace pensions

If you start a new job, you can transfer your existing pension(s) to your new workplace pension scheme that will be setup automatically when you start.

A workplace pension scheme is where your employer contributes at least 3% of your salary, if you contribute 5% – so effectively, you’re getting free money from your employer by paying in. It’s a no-brainer to open one really (rather than opting out).

However, this 'free money' is only added on future pension contributions from your salary, and doesn’t apply to any pension transfers.

Why NOT to transfer to a workplace pension

Although you have the option to pay as much as you like in (up to your total income, maximum limit of £60,000 per year), it’s not particularly beneficial to pay more than 5% into a workplace pension, unless your employer will give you more free money if you add more (some employers do this).

After you reach your limit of getting free cash from your employer, it’s typically better to start saving within a personal pension instead – you’ll still be able to save tax-free, as you’ll get the 25% bonus from the Government on your contributions (and more if you pay 40%, or 45% tax).

A personal pension gives you the ability to decide which pension provider you want to use, so you can pick one that’s easy to use, has low fees, and a great track record. 

And, you can typically transfer your personal pension to another provider whenever you like (in future) – so you’re not ‘locked in’.

With a workplace pension, you can only use the one your employer has chosen, it's like getting a mobile phone deal but only having one choice. You can't compare the fees or the service it provides. And typically workplace pensions aren’t the best out there, they can be expensive (high fees), and poor performing (investment wise).

Note: with your current workplace pensions you can’t transfer it until you leave your job.

That’s why we don’t recommend transferring your pension to your new workplace pension scheme, as once it’s there, you can’t move it again, and it’s probably not the best provider out there.

If you’re looking for some great pension options, here’s the best pension providers in the UK.

How does a pension transfer work?

Luckily, this is the easy bit. When it comes to transferring a pension to a personal pension, you don’t have to do much – just request a transfer with a click of a button and your new provider will handle everything (if you pick a great one – such as our recommendations above).

They’ll get in touch with your existing provider, and handle all the paperwork. You just sit back and relax, and it will be moved over after a few weeks (or sometimes months).

You will need to know who your current provider is though – just email or ask your old work HR department. Or visit Gov.uk to find your pension contact details.

No excuses not to transfer now is there?

Should I consolidate all my pensions?

If you’ve got a few pensions lying around from old jobs – it’s often a good idea to combine these into your new pension too (called consolidating your pension).

Why? Well, first of all, and an important one, they’ll never get lost! 

Lots of people forget about their old pensions and never claim them – there’s actually around 1.6 million lost pensions in the UK, totalling £19.4 billion, according to The Association of British Insurers.

On top of that, it’s likely that your old pensions aren’t with the best providers (they were likely old workplace pensions), and so could be costing you a lot in fees (taken automatically from your pension pot), and probably not growing as fast as they could be.

If you consolidate your pensions with a great modern pension provider, such as PensionBee¹ or Moneyfarm¹ (if you want expert advice) – you’ll be able to see them all in one place (one big pension pot), and your money will be with a provider that’s easy to use, has low fees and a great track record.

Nuts About Money tip: learn more with our guide: should I consolidate my pensions?

How to build up a big pension pot

We mentioned that building up a big pension pot is pretty essential these days, in fact, here’s how much you’ll need to save up in total to give yourself the retirement you’d like:

The yearly income figure includes the State Pension, so if you’re not likely to get this, you’ll need to save even more. To qualify for the full amount, which is £203.85 per week, you’ll need to have paid 35 years National Insurance contributions.

The key to building up a big pension pot, is to first make sure you’re making the most of your workplace pension, by contributing 5% to get the free 3% from your employer (and more if they match it).

After that, you’ll likely need to start saving into a personal pension regularly too – save as much as you can comfortably afford each month.

Now the trick is to be consistent, keep adding to it whenever you can and that's it. Your money should grow within your pension (as the investments go up in value). And as it grows, the new money it makes, begins to make money too – and this snowballs over and over each year, called compound interest, turning small amounts into very large numbers. 

For example, imagine you started with £1,000 and then saved £300 per month, and it increased by 5% per year. After 25 years, you’d have a whopping £184,134.20, and after another 10 years, this would rise to £346,561.45.

Not bad right? So, if you combine your workplace pension pot, with a personal pension, you’ll likely get up to pretty big numbers – perhaps even more than the £747,003 that gives you a comfortable retirement income of £37,300.

If you’re a bit older, you might not have that long to save, but save as soon as you can, and if you can, pay in a bit more each month – it really will add up over time.

Let’s recap

There we have it. The best pension provider to transfer to – PensionBee¹, if you’re looking for an easy to use, low cost option, with great customer service. And, Moneyfarm¹, if you’re looking for a bit of extra support and advice.

If you’re looking to make your own investments, with a SIPP, the best pension providers are AJ Bell¹, and Interactive Investor¹ (cheaper for higher value pension pots). Both low cost, have a huge range of investment options and great customer service.

You can also check out the full range of options, with our best personal pensions.

If you’re in two minds about transferring your pension – it’s often a great idea…

Transferring to a great new personal pension means you’re in control of your money, you can choose one that’s low cost, easy to use and a great track record of growing money over time. And, you’ll be able to consolidate your pension(s) into one place, so you never lose track of any old pensions, and can potentially benefit from lower fees and better performance.

One last final thing – get saving as much as you can, the 25% bonus will really help over time, you’re future self will really thank you when you’re pension savings are nice and big, ready for a comfortable retirement.