PensionBee vs Nutmeg – which is best?

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Fact Checked.
Updated on
October 21, 2022

In a nutshell

PensionBee is a clear winner here. It’s great for pensions and easy to get started. It’s much cheaper than Nutmeg too, and the investment choices are suited to pensions rather than general investing like Nutmeg is. Plus the PensionBee customers love them too. PensionBee is our winner.

Nutty

Ready to save a bit more for retirement and open a personal pension? That’s a pension that you open rather than your employer, which is called a workplace pension.

It’s a great idea to open a personal pension, not only will you be able to save tax-free, but you’ll also get a government bonus of 25% automatically added to your account. Free money, not bad right? Here’s where to learn even more about personal pensions and compare all personal pension providers.

Personal pension

Note: a personal pension is also called a Self-Invested Personal Pension (SIPP).

To be honest, PensionBee and Nutmeg are both good options, but which is best? Let’s compare and find out.

PensionBee vs Nutmeg

PensionBee vs Nutmeg: ease of use

PenionBee is known for being super simple to set up and use, and it is! You’ll struggle to find an easier way to set up a pension. 

PensionBee app

You don’t need to know anything about pensions, you simply open an account, decide which investment option you’d like (there’s only a few and it’s all simple to understand), and then you’re good to go.

Simply add money through the app or ask their experts to transfer any old pensions you might have over, it's all handled for you.

With Nutmeg, it’s a little bit more complicated. You do need to know a little bit about investing, but it’s not overly complicated, and it’s similar to PensionBee, where you just pick from a few options.

Nutmeg app

Nutmeg isn't just a pension provider, so the app is slight more complicated. They also offer a Stocks & Shares ISA, a Lifetime ISA and a standard account (called a General Investment Account).

When it comes to the apps themselves, PensionBee is very highly rated – 4.7 out of 5 on Apple and 5 stars on Google Play store. Pretty great!

PensionBee app rating

Nutmeg is rated slightly less on average, with 4.8 stars out of 5 on the Apple App and 4.5 on the Google Play store.

Nutmeg app rating

Note: you can also get started on the PensionBee website¹ and Nutmeg website¹.

One big difference is that with Nutmeg, you have to open an account with at least £500. PensionBee you can get started with as little as you like!

So overall, PensionBee is a bit easier, and because of that, and no minimum amount to get started, we’re giving ‘ease of use’ to PensionBee.

Winner: PensionBee

PensionBee wins!

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PensionBee vs Nutmeg: costs

When it comes to costs, PensionBee is much cheaper, by quite a lot.

PensionBee charges one simple fee, and that’s it. It starts at 0.50% of your pension balance per year, although depending on which investment option you choose, this can be 0.75%.

PensionBee fee

With Nutmeg, they charge an annual management fee, the cheapest is 0.45% but the most popular options are 0.75%.

You’ll then pay a fee for the investments within your account, and this ranges from 0.22% to 0.28% (more on investment options later). And then you’ll also pay an extra more hidden fee called a spread fee, which is 0.07%, and is effectively a cost to buy the investments within your account.

So in total, Nutmeg fees range from 0.74% to 1.1%.

Nutmeg fees

Let's compare directly: if you were to pick the ethical investment option with both, PensionBee would be 0.75% and Nutmeg would be 1.1%, quite a big difference!

Overall, PensionBee is quite a bit cheaper.

Winner: PensionBee

PensionBee vs Nutmeg: investment options

PensionBee is super simple, just how it was designed to be. There’s only a few options for where your money will be invested. There’s actually 7, but here’s the 3 most popular, that most customers opt for:

  • Tracker - investments that just follow the economy (lower cost)
  • Tailored - experts manage the investments
  • Fossil Fuel Free - expert managed, and no businesses that harm the environment
PensionBee investment options

With Nutmeg, there’s only a few options too, which is great, and here they are:

  • Fixed Allocation - investments don't often change (lower cost) 
  • Fully Managed - experts manage the investments
  • Smart Alpha - uses experts from J.P. Morgan
  • Socially Responsible - ethical investment option
Nutmeg investment options

Comparing just these investment options there’s not much in it. However, we’re giving it to PensionBee, as they’ve got 7 options rather than 4 with Nutmeg, and these options are more suited to the stages of pension savings.

For instance, you can switch to options that are suited to nearing retirement age with PensionBee (safer and lower risk, aiming to preserve your pension pot rather than grow it), which you can’t do with Nutmeg. PensionBee has been designed to handle pensions and nothing else, whereas Nutmeg is more of an investment platform and the investment options reflect this.

Winner: PensionBee

PensionBee vs Nutmeg: customer reviews

To compare the customer service of both companies, it’s a good idea to look at the customer reviews. And to do this, we’ll use Trustpilot, the popular reviews website.

PensionBee has an excellent rating of 4.6 out 5 from over 8,000 reviews! That’s awesome. Most of the reviews mention how easy it is to set up and use, along with great customer service.

PensionBee Trustpilot rating

With Nutmeg, the rating is lower. Just 3.8 out 5, from just 1,000 reviews. The performance of the investments have not been the best in recent years, and so lots of complaints about this and suggesting other companies are doing much better. There’s also a fair few complaints about the service.

Nutmeg Trustpilot rating

There’s no question, PensionBee is the winner here.

Winner: PensionBee

PensionBee vs Nutmeg: the winner

PensionBee has really run away with it here! Although Nutmeg is great compared to a lot of companies out there, PensionBee is in a different league and is a clear winner.

PensionBee is much easier to get started and use. You can be up and running in a few minutes, it's easy to add money, and they'll track down any old pensions you have for you too.

It’s much cheaper too, with one simple fee per year, rather than 3 different fees from Nutmeg, which you add together, and results in much higher costs.

PensionBee specialises in pensions, and so their investment options are suited to retirement savings for whichever stage of life you are in. With Nutmeg, there’s 4 options, but suited more to general investing rather than pension saving.

And finally, PensionBee customer reviews are much better. Customers love PensionBee, and the service is great (we can vouch for this too). With Nutmeg, customers are becoming very frustrated with the poor investment performance.

So there we have it. PensionBee is our winner! If you want to learn more, check out our PensionBee review or visit the PensionBee website¹.

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PensionBee wins!

Is PensionBee for you? Get £50 for free when you sign up with Nuts About Money.

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Capital at risk.

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PensionBee wins!

Is PensionBee for you? Get £50 for free when you sign up with Nuts About Money.

Sign up, get £50¹Sign up, get £50¹

Capital at risk.

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