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Compare pension drawdown plans and charges

Pension drawdown allows you to keep your pension invested while you withdraw a flexible income in retirement. Use our tables to compare drawdown fees and charges.

In this article
Why should I shop around for pension drawdown? How do pension drawdown charges work?
Pension drawdown plans compared Pension drawdown companies: in detail

Why should I shop around for pension drawdown?

Pension income drawdown is becoming one of the most popular ways to generate an income from your retirement savings. 

In a drawdown plan, you keep your savings invested in the markets to keep growing, while taking a flexible income as you go.

Much like any financial product, it's vital that you shop around for the best value drawdown products. Fail to do so, and you could end up paying more in fees and charges than is necessary. 

In a 2018 investigation, Which? found that the difference between the cheapest and most expensive drawdown plans was a staggering £12,000 lost in charges over a 15 year period.

It is notoriously difficult to compare drawdown plans - but Which? has done the hard work for you, analysing the charges of dozens of drawdown providers and showing you how much drawdown might cost you during retirement.  

 

How do pension drawdown charges work?

One of the major barriers to a straightforward comparison of costs is the fact that companies have very different charging structures. 

You may incur five or six separate types of fee each year depending on the provider you choose. These could include:

  • set-up fees 
  • annual administration charges
  • platform charges
  • dealing commission to trade funds and shares

You will also need to pay charges for the investments you select in your drawdown pension plan.

Some companies charge flat annual fees, while others charge a percentage fee based on the amount you have in your pension. Some combine the two types of fee. 

It gets even more complex. Where percentage product or platform charges are levied in tiers according to the value of your fund, there are two different approaches. 

Some providers have an ‘income tax band’ system, where, say, the first £50,000 of your pot has a fee of 0.45%, with the next £150,000 incurring a charge of 0.4% and so on.

The alternative tiered structure works on a ‘whole fund’ basis, with a charge at one rate, which will vary depending on the plan’s overall value. 

Pension drawdown plans compared

We've combed through the charges levied by 22 providers of pension drawdown - the most comprehensive analysis you can find. 

In this table, you can find:

  • Whether you need financial advice to access drawdown
  • Any fixed fees you might face
  • Relevant charges for pensions worth £100,000, £250,000 and £500,000. 

These figures were correct as of June 2019.

Pension drawdown companies: in detail

Our company profiles outline the charging structures for the main providers.

 

Aegon pension drawdown: fees and charges

 

Aegon has a £75 annual charge covering administration of drawdown, whether you take regular or ad hoc payments.

Platform/product fee

Aegon's Retirement Choice drawdown plan charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • First £29,999.99 - 0.60%
  • Next £20,000 (£30,000 to £49,999.99) - 0.55%
  • Next £50,000 (£50,000 to £99,999.99) - 0.50%
  • Next £150,000 (£100,000 to £249,999.99) - 0.45%
  • £250,000 and over - 0.00%

 

AJ Bell Youinvest pension drawdown: fees and charges

 

The fee for a one-off income payment is £30 per year.

Platform/product fee

AJ Bell Youinvest’s Sipp charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • First £0 - £250,000 - 0.25%
  • Next £250,000-£1m - 0.10%
  • Next £1m-£2m - 0.05%
  • Value over £2m - No charge

 

Alliance Trust Savings pension drawdown: fees and charges

 

To move into flexible drawdown, you need to have a Sipp with Alliance Trust savings. 

Its Sipp (Income) Account costs £23.75 + VAT per month, which equals £28.50 per month. That equates to £342 per year.

There are no other platform charges.

 

Aviva pension drawdown: fees and charges

 

There are no charges for drawdown set-up and income withdrawals.

Aviva’s Advised Platform Sipp (called 'Pension Portfolio') charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • Up to and including £29,999 - 0.40% 
  • £30,000 to £249,999 - 0.35%
  • £250,000 to £399,999 - 0.25%
  • £400,000 and over - 0.15%

 

Barclays Smart Investor pension drawdown: fees and charges

 

There is an annual Sipp fee of £150 and drawdown fee of £120 (levied by AJ Bell).

Platform/product fee

Barclay Smart Investor's Sipp charges a single percentage fee on your entire pension pot. This is currently 0.2% per annum. 

 

Bestinvest pension drawdown: fees and charges

 

There is a Sipp annual admin fee of £120 and an annual charge of £100 for income payments if your pot is worth less than £100,000.

Bestinvest’s Sipp charges a percentage fee, which reduces depending on the size of your pension pot. 

The bigger the pension, the lower the fee charged on all the money you hold. 

It works like this:

  • Up to £250,000 - 0.3% a year 
  • £250,000 - £1m - 0.2% a year
  • Over £1m – 0%

 

Charles Stanley Direct pension drawdown: fees and charges

 

There is a payroll charge for taking annual income from the Sipp of £60 and a Sipp admin charge of £120 if you've less than £30,000 in your Sipp.

Platform/product fee

Charles Stanley Direct’s Sipp charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • Up to £250,000 – 0.35%
  • A platform charge reduction to 0.20% on the balance of fund holdings above £250,000.
  • A further platform charge reduction to 0.15% on the balance of fund holdings above £500,000.
  • A further platform charge reduction to 0.05% on the balance of fund holdings above £1m.
  • No charge on fund holdings in excess of £2m.

 

Close Brothers pension drawdown: fees and charges

 

Platform/product fee

Close Brothers' Sipp charges a single percentage fee on the total value of its fund, which is 0.25% per annum. 

This is deducted monthly, and applies to unit trusts and OEICs, equities, investment trusts, exchange traded funds, Gilts and any other exchange traded securities.

 

Fidelity pension drawdown: fees and charges

 

Platform/product fee

Fidelity's Sipp charges a percentage fee, which reduces depending on the size of your pension pot.

The bigger the pension, the lower the fee charged on all the money you hold.

It works like this:

  • £0 to £7,499.99 - 0.35% with monthly Regular Savings Plan, £45 a year without.
  • £7,500 to £249,999.99 - 0.35%
  • £250,000 to £1m - 0.20%
  • No further Service Fee is charged for assets held above £1m

 

Halifax Share Dealing pension drawdown: fees and charges

 

There are annual Sipp and drawdown fees of £180.

There are no annual platform fees.

 

Hargreaves Landsdown pension drawdown: fees and charges

 

Hargreaves Lansdown's Sipp charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • £0-£250,000 - 0.45%
  • £250,000 to £1m - 0.25%
  • £1m to £2m - 0.10%
  • Over £2m - 0%

 

Interactive Investor pension drawdown: fees and charges

 

There are annual Sipp and drawdown fees of £120.

There are no platform fees.

 

James Hay pension drawdown: fees and charges

 

There is an annual Sipp admin fee of £184 (waived where more than £200,000 is maintained in qualifying investments) and an annual drawdown fee of £150.

Platform/product fee

James Haye’s Sipp charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • First £300,000 - 0.25%
  • On next £300,000 – 0.20%
  • On next £400,000 - 0.15%
  • On next £500,000 - 0.05%
  • Over £1.5m - 0.01%

 

LV pension drawdown: fees and charges

 

LV Full’s Sipp charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • First £75,000 – 0.55%
  • Next £275,000 – 0.35%
  • Next £650,000 – 0.20%
  • Over £1m – 0.10%

 

Old Mutual Wealth pension drawdown: fees and charges

 

Old Mutual’s Collective Wealth Retirement Account charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • First £25,000 - 0.50%
  • £25,000 to £100,000 - 0.35%
  • £100,000 to £500,000 - 0.30%
  • £500,000 to £1m - 0.25%
  • £1m+ - 0.15%

 

Prudential pension drawdown: fees and charges

 

Prudential’s Retirement Account charges a percentage fee, which reduces depending on the size of your pension pot.

The bigger the pension, the lower the fee charged on all the money you hold.

It works like this:

  • £0-24,999 - 0.65%
  • £25,000-£49,999 - 0.55%
  • £50,000-£99,999 - 0.45%
  • £100,000-£249,999 - 0.40%
  • £250,000-£499,999 - 0.35%
  • £500,000-£749,999 - 0.30%
  • £750,000-£999,999 - 0.275%
  • £1m or above - 0.25%

 

Royal London pension drawdown: fees and charges

 

Royal London Pension Portfolio Income Release plan charges a percentage fee (1%), which is not a separate fee – it’s built into the price of the investments you choose.

Then, it applies a discount based on how much you have in your pension. The discount applies to your entire pension pot.

It works like this:

  • £0-£33,600 – 0.10% per year, so the charge is 0.90%
  • £33,601-£67,300 – 0.50% per year, so the charge is 0.50%
  • £67,301-£202,000 – 0.55% per year, so the charge is 0.45%
  • £202,001-£673,000 – 0.60% per year, so the charge is 0.40%
  • £673,001+ - 0.65% per year, so the charge is 0.35%

 

Scottish Widows pension drawdown: fees and charges

 

Scottish Widows’ Retirement Account Sipp charges a percentage fee, which reduces depending on the size of your pension pot.

The bigger the pension, the lower the fee charged on all the money you hold.

It works like this:

  • £0-£29,999 – 0.90%
  • £30,000-£49,999 – 0.40%
  • £50,000-£249,999 – 0.30%
  • £250,000-£499,999 – 0.25%
  • £500,000-£999,999 – 0.20%
  • £1m+ - 0.10%

 

Selftrade pension drawdown: fees and charges

 

There are annual Sipp and drawdown fees of £118.80 and £180 respectively.

Platform/product fee

Selftrade’s Sipp charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • 0.3% on the first £50,000, then
  • 0.25% for values between £50,000 and £250,000, then
  • 0.15% for values over £250,000

 

Standard Life pension drawdown: fees and charges

 

Standard Life’s Active Money Sipp charges a percentage fee, which reduces depending on the size of your pension pot.

The bigger the pension, the lower the fee charged on all the money you hold.

It works like this:

  • Fund under £100,000 - 0.6% of the Sipp Zone value a year
  • £100,000-£249,999 - 0.55% of the Sipp Zone value a year
  • £250,000-£499,999 - 0.45% of the Sipp Zone value a year
  • £500,000+ - 0.4% of the Sipp Zone value a year

 

The Share Centre pension drawdown: fees and charges

 

There are annual Sipp and drawdown fees of £180 and £234 respectively.

There are no platform fees.

 

Zurich pension drawdown: fees and charges

 

There is an annual Sipp admin fee of £75.   

Zurich's Retirement Account charges a percentage fee in tiers.

It works a bit like income tax bands – each percentage fee applies to different amounts held in the Sipp, rather than a single percentage fee applied your entire pension.

It works like this:

  • First £100,000 - 0.35%
  • Next £150,000 - 0.30%
  • Next £250,000 - 0.25%
  • £500,000+ - 0.10%

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