The cheapest Self-Invested Personal Pension (SIPP) providers
High earners are increasingly contributing £60,000 and above to their Hargreaves Lansdown Self-Invested Personal Pension (SIPP), new data shows.
The number of people making contributions of exactly £60,000 – the full allowance – was up 12 per cent in the last tax year. The number of people making SIPP contributions over the annual allowance was up by 34 per cent.
“The surge in contributions could be due to the removal of the lifetime allowance as well as the increase the annual allowance to £60,000 in recent years,” says Helen Morrissey, head of retirement analysis at Hargreaves Lansdown.
“This meant that in the last year, someone making full use of carry forward could contribute up to £200,000 to their pension. Someone in the same position this tax year can contribute up to £220,000,” she added.
If you already have a SIPP or are considering opening one, you’ll want to review the ones with the lowest fees.
The top SIPP providers in the UK?
Aberdeen’s interactive investor* has topped a ranking of Self-Invested Personal Pension (SIPP) providers in the UK.
According to Kepler Trust Intelligence, interactive investor* substantially undercuts its competition in terms of fees and was awarded “best all-rounder”.
For a portfolio value of £250,000, an interactive investor customer would pay £204 in fees. In comparison, an investor using Bestinvest would pay £1,030.
However, AJ Bell, which scores second place in the overall ranking, maybe the better choice for those investors with a smaller portfolio.
On a portfolio worth £20,000, AJ Bell’s fees are just £89 compared to £120 as charged by interactive investor*.
Fees charged by major providers
| Portfolio value | £20,000 | £100,000 | £250,000 |
| interactive investor* | £120 | £204 | £204 |
| AJ Bell | £89 | £284 | £472 |
| Charles Stanley Direct | £180 | £300 | £600 |
| Fidelity | £135 | £310 | £385 |
| Hargreaves Lansdown* | £162 | £497 | £834 |
| Bestinvest | £150 | £430 | £1,030 |
Still, the report says that when it comes to larger portfolios, interactive investor* offers the best value.
The firm also took home the gong “best for customer service”, with Kepler highlighting its 4.8 rating on Trustpilot – the highest of the brands in the ranking.
Jo Groves, Investment Specialist at Kepler Partners, said: “Choosing the best SIPP provider can make a significant difference to individual retirement savings, particularly in terms of maximising the value of your portfolio and minimising fees.”
“Over the long term, even small differences in fees can reduce the value of a portfolio by thousands of pounds – the difference between a flat fee and a one per cent platform fee could be £150,000 over a 30-year period.”
Interactive investor has more than 430,000 clients with a range of 40,000 investment options – with the firm setting itself apart with a flat platform fee structure, rather than being percentage-based.
Groves added: “It’s worth carefully weighing up the pros and cons of different pension providers to find the best option to meet your needs.”