Our pension awards, judged by a team of independent experts, are here to help you clinch the deal that’s right for you
Many of us will do the bulk of our pension saving via a work-based pension scheme that we will have little say on. However, if you find yourself in a position where you don’t have access to a work-based pension or you find such a pension doesn’t meet your requirements, you may need to set up your own personal pension.
Alternatively, you may have changed jobs and accumulated a lot of plans you would like to consolidate into one pot. Or you might be at the end of your working life and need a platform on which to manage your retirement income.
The amount of money you pay into your pension and the investment funds you choose will have the biggest impacts on your eventual retirement income, but the savings wrapper you choose will also have a bearing on this. Pay over the odds in charges and your returns will be eroded.
Likewise, the easier your pension is to monitor and manage the more likely you are to engage with your retirement savings planning and build a substantial pot.
Whatever your circumstances, there are plenty of options on offer from insurance companies and online investment platforms, many of which offer a raft of investment choices and some of which make all the investment decisions for you.
The 2019 Moneywise Pension Awards is here to help you pick the right pension for you.
Best personal pension
This category is for pensions from insurance companies, many of which are sold by independent financial advisers. They should suit many savers, whether they are putting away modest amounts or large sums, and they allow account holders to manage their pension pots flexibly in retirement.
Winning the award for an impressive fifth year in a row is Royal London, which scored maximum marks from all our judges.
Patrick Connolly, a judge and a chartered financial planner at Chase De Vere, says: “Royal London provides consistent market-leading service standards for its customers. It has a top-quality product that is flexible, has competitive charges and offers a wide range of investment fund options. For those who don’t want to make their own investment choices, its governed portfolios are sensible options. These are tailored to the risk profile of individual customers, which should, at the very least, stop policyholders going too far wrong.
“As an added bonus, Royal London is a mutual company, so it might share some of its profits with policyholders.”
In second place is Standard Life. Mr Connolly says: “Standard Life is a good-quality pension provider that offers flexibility to suit all requirements, whether customers have basic or specialist needs. It has very high service standards, provides a good range of underlying fund options, and has excellent and easy-to-use online services for investors.”
Best Sipp for beginners
Self-invested personal pensions offer pension savers a comprehensive array of investment options, including funds, trusts and in some cases shares from an online platform.
Choosing a Sipp isn’t always easy though. Different platforms will target various customer types and have disparate charging structures. Which Sipp is most cost-effective for you will depend on how much you have invested and your trading habits.
Cost is a key consideration, but it is also important that a Sipp provider’s customer service is up to scratch, that your pension is easy to monitor and review, and that the platform has a range of tools to help you manage your investments.
This award is for Sipp providers that target investors who are opening a Sipp for the first time and paying in approximately £200 a month.
Our judges’ favourite this year was last year’s runner-up, Fidelity International. Richard Bradley, research director at Platforum, says: “For regular pension savings, Fidelity Personal Investing is a solid low-cost option that offers plenty of help for inexperienced investors. Novice investors could pick one of Fidelity’s PathFinder funds. These funds are targeted at different risk levels, so investors can match a fund to the risk they are willing to take.”
Coming in a close second is AJ Bell Youinvest. Nick McBreen, an IFA at Worldwide Financial Planning, says: “It’s a straightforward, cost-effective platform that offers lots of investment choice and good reporting capability.”
Best Sipp for larger portfolios
If you have accumulated a large pot, some Sipps for beginners could be expensive. In this category our judges focused on Sipps for savers with £200,000-plus saved. For the fourth year in a row, interactive investor (Moneywise’s parent company) came out on top.
Mr McBreen says: “It is good to see interactive investor continuing to merit attention and recognition for what it can offer in the Sipp space. The platform and app are pretty user-friendly: they offer a menu of price options from which investors can choose the model that best suits their needs. Particularly refreshing is the use of fixed-fee charging rather than the more traditional percentage rate. This should be very attractive for investors, especially for people with Sipp values north of £60,000. With lots of investment choice available, this is a strong challenger for Sipp funds going forwards.” interactive investor was voted top in this category by all our judges.
Our runner-up is The Share Centre. Mr Bradley says: “For larger portfolios, The Share Centre is a low-cost option, as it charges flat fees rather than a percentage of investments. Investors who transact regularly or place large transactions can also benefit from a ‘frequent dealing’ option, where paying an additional quarterly fee cuts transaction costs. A wide variety of investments is available, and it costs the same irrespective of whether you’re investing in funds or shares.”
Best Sipp for income drawdown
The introduction of pension freedoms in April 2015 has resulted in more people shunning annuities and taking advantage of the opportunity to manage their retirement income flexibly, and they need a Sipp that can cope with these demands cost-effectively.
For some people, this flexibility might mean them leaving their pension savings invested and drawing monthly income; for others it might just mean withdrawing ad hoc lump sums. Some may choose to leave their money in their pot until they need it.
For the fourth year in a row, the award goes to AJ Bell Youinvest. Steve Nelson, consulting director at the lang cat, says: “For drawdown, for me it’s about picking a provider with a strong pension heritage to give me faith that the portfolio will be serviced well. It should also represent value for money, as the chances are that, come the time to take drawdown, a customer will have built up a significant sum of money.
“I think AJ Bell Youinvest represents the best pick here. It has evolved from a Sipp specialist into a significant, modern platform provider. You get the benefit of its strong pension centre of gravity but also of a provider that demonstrates ongoing investment and commitment to the market. It has a hybrid charging structure – a low platform charge, but ongoing event-driven charges for pension activity. However, as long as you are not tinkering too much, it represents good value for money.”
The runner-up this year is Fidelity International. Mr Bradley says: “A wide range of investments is available, including all-in-one funds for those not looking to build their whole portfolios themselves. Fidelity Personal Investing doesn’t charge any additional costs for income drawdown on top of its standard pension charges.”
Best robo-advice Sipp provider
An investor may want to manage their retirement savings online without necessarily having the desire or experience required to choose their investments or needing access to a vast universe of funds. Robo-advice platforms have emerged to target this type of customer.
We launched this award last year in recognition of sharply rising demand for products that enable savers to run their pension online without having to make in-depth investment decisions.
With robo-advisers, instead of actively deciding which funds to pay their contributions into, customers answer a series of questions about their attitude to risk, and their money is then invested into one of the platform’s packaged portfolios.
This year Nutmeg, our inaugural winner, has been knocked off the top spot by PensionBee – a service that gathers all your accumulated pensions and invests them in a single pot.
Mr Bradley is a big fan. He says: “PensionBee helps investors consolidate their pensions into a single account so that they can more easily manage them and make additional contributions. There is a variety of investment options, depending on how you would like your pension managed and the risk you are prepared to take.”
Mr McBreen adds that it offers both competitive charging and access to good investments. “The investment management charges for the service are in a pretty sweet spot, in the range 0.5%–0.9%. Another big plus is that included among the seven investment options is an ethical, climate-conscious option from Legal & General. This, I believe, is the way ahead for many people when making Sipp investment decisions, bearing in mind that for most people Sipp investing is all about the long-term horizon.”
The runner-up this year is True Potential. Mr McBreen describes it as a “straightforward plug-and-play Sipp option”. Unlike other providers in the field, the Sipp uses actively managed funds rather than passive investments.
Best mainstream annuity provider
Although many retirees opt to leave their pension invested when they retire and draw a flexible income from it, some prefer the peace-of-mind option provided by an annuity that pays a fixed income for life.
However, it is now possible to opt for a bit of both. Retirees can now buy sufficient annuity income to pay their bills but leave the rest invested.
Taking the award for an impressive fourth year in a row is Legal & General. Mr Connolly says: “Legal & General offers competitive standard rates for most people. Indeed, in many cases it offers the market-leading rate. It is one of very few companies that still put a real focus on providing good-quality annuity products, and it backs this up by providing a consistently strong level of service.”
Aviva is in second place. Mark Stone, a chartered financial planner at Whitechurch Securities says: “Aviva is a very strong office that was only marginally pipped, and it has a very well-rounded and competitive offering.”
Best enhanced annuity provider
If you smoke or have health problems that could reduce your life expectancy, you may be able to get an annuity deal that pays a higher income from a specialist provider that takes your specific circumstances into account.
You don’t have to be seriously ill: conditions such as high blood pressure and diabetes could qualify you for a better rate.
This year Just takes the award – also for a fourth consecutive year. Mr Connolly says: “Just has established itself as a market leader for enhanced annuities. It previously offered rates its competitors frequently couldn’t match. While this may no longer be the case, Just’s rates are still at or near the top of the tables. What’s more, while Just isn’t one of the financially strongest providers, its products cover a comprehensive range of customer circumstances and its service is often considered the best in the sector.”
L&G comes in second place. Mr Stone says L&G offers “a very competitive product. Add to that its service offering, and it has all the bases covered.”
Speak up on pensions education and win a prize!
For the past two years Moneywise has given an award for the best pension education initiative. Last year the award went to Aviva and in 2017 it was given to Fidelity – both for their excellent online retirement planning tools. This year, however, the few nominations we received from our judges weren’t strong enough to wow us, while our own research didn’t come up with anything new to break the mould. So we want to hear from you! We would love to hear which pensions companies have given you the most help with your retirement planning – this could have been via a video, tool, calculator or guide that helped you, whether you are at the start or end of your pension saving journey.
Email your suggestion with the relevant web links to email@example.com by 30 September 2019. The best suggestion will be rewarded with a £50 shopping voucher.
Our pensions, Sipps and annuity categories were judged by a panel of independent judges. We asked panelists to consider factors such as charges, value for money, customer service and ease of use. Thanks to the lang cat for the Sipp shortlists and to JLT Pension Decision for supplying annuity best-buy data.
The winners of the 2019 Moneywise Pension Awards were chosen by the following panel of independent judges: Patrick Connolly, chartered financial planner, Chase De Vere (excluding robo-Sipp); Nick McBreen, independent financial adviser, Worldwide Financial Planning; Mark Stone, chartered financial planner, Whitechurch Securities (excluding robo-Sipp); Steve Nelson, consulting director, The Lang Cat (Sipps except best robo-Sipp); and Richard Bradley, research director, Platforum (Sipps only).