How taking a Sipp could refresh your retirement savings

Close to one million (960,000) pension savers in 2024 decided to take more control over their nest egg by opening a self-invested personal pension (Sipp), according to Financial Conduct Authority data – an increase of 30% compared with 2022. 

Sipps are essentially do-it-yourself personal pensions that put investment decisions in your hands.

Here, we explain how a Sipp can help you manage your retirement savings, how costs compare and how to choose the right one for you.

• Find out more: best Sipps 2026

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What is a Sipp?

A Sipp is a type of defined contribution (DC) pension, which means the final value of your pot at retirement will depend on how much you've contributed and how the underlying investments have performed.

Unlike other types of private pensions, you'll be taking on responsibility for choosing and managing your own investments, so you'll need to have the time and confidence to do this.

Sipps have the same tax benefits as other pensions: your money can grow free of income tax and capital gains tax, and you’ll get tax relief on your contributions. This means that for every 80p basic-rate taxpayers add to their pension, the government will add a further 20p. 

Higher-rate and additional-rate taxpayers can claim back a 40p and 45p, respectively. In most cases, you can’t receive tax relief on any pension contributions that exceed your annual earnings or £60,000, whichever is lower.

• Find out more: how much will you need to retire?

Why choose a Sipp?

in March 2026, we surveyed 2,533 savers with a Sipp. The most common reason they gave for opening their first Sipp was to gain more control over their pension (51%), followed by wanting to boost returns (39%) and to access a wider range of investments (35%). 

Meanwhile, 27% said they had made the move to prepare for a smooth transition into pension drawdown (not all pension providers offer this). Around half (51%) of respondents said they’d consolidated some or all of their existing pensions into their Sipp.

As with other pensions, you can take up to 25% of the money in your Sipp as a tax-free lump sum (up to a maximum of £268,275) from the age of 55.

With the rest of your money, you can keep it invested and make withdrawals as you need it (pension drawdown), secure a guaranteed income by buying an annuity or withdraw your savings as cash – either in one go or in chunks.

• Find out more: options for cashing in your pensions

How much Sipps cost

Unlike workplace pension schemes, which are allowed to charge a maximum of 0.75%, there’s no cap for Sipp fees and they can vary significantly between providers. 

This means your choice of provider can save, or cost, tens of thousands of pounds in the long term. 

Our analysis shows that a Sipp with an initial value of £250,000 would be worth £12,600 more after 10 years (assuming investment growth of 3% a year) if held with the cheapest provider in our analysis (Freetrade) rather than the most expensive (Aegon). After 15 years, the difference rises to £20,400. 

The best value provider for you will often depend on how much you have in your Sipp. Platforms with low fixed fees, notably Interactive Investor, Freetrade, Halifax Share Dealing and Scottish Widows Share Dealing, are cheap for all pot sizes. 

Our pricing analysis assumes your money is invested entirely in funds. But some companies work out significantly cheaper if you’re investing in individual shares, investment trusts, exchange-traded funds (ETFs) and bonds – for example, AJ Bell, Fidelity and Hargreaves Lansdown. 

On top of the charges levied by the Sipp provider, you’ll need to factor in the fees for the individual investments held in your Sipp.

• Find out more: Sipp charges compared

Ready-made options for less confident investors

If you’re feeling daunted by the prospect of picking your own investments, many platforms and other relatively new providers now offer ready-made portfolios as an ‘off-the-shelf’ alternative.

Rather than choosing from thousands of individual investments, you choose a pre-selected portfolio of funds to match your risk appetite (such as cautious, moderate, adventurous). 

Costs can work out cheaper. For example, the Hargreaves Lansdown Ready-Made Pension Plan now comes with an account charge of 0.15% (plus a 0.3% fund management charge), compared with 0.35% on the first £250,000 with its standard Sipp. 

AJ Bell’s Ready-Made Pension carries an all-in charge of 0.45%. Both providers say that between a quarter and a third of new Sipp customers now choose a ready-made option. 

Companies such as Moneyfarm and Moneybox also offer a few funds at a low cost. The latter charges only 0.15% a year (capped at £150) if you stick to its three branded pension funds.

Should you take Sipp?

More retirement savers have turned to Sipps in recent years: in our 2026 survey, 37% of Sipp customers said they'd held their pension for less than three years.

But this type of pension isn't suitable for everyone. It's most suited to savers who feel comfortable choosing and managing their own investments.

If you're a less confident investor but are still interested in a Sipp, you could consider paying a financial adviser to do the heavy lifting for you.

Alternatively, the growing range of ready-made Sipps are worth looking at if you want help with investment decisions, but don’t want to incur the expense of full financial advice.