How to choose a pension

Choosing a pension involves comparing the details of different plans, including contribution limits, annual fees and how your account can be managed. You should also look at the investment strategy, including the plan’s approach to risk management and the fund’s past performance.

If you have a workplace pension, your employer will usually choose the provider, but if you’re opening a private pension, it’s up to you to decide on the best pension provider and a pension plan that’s right for you. If you are unsure about whether you already have a pension our “Do I have a pension?” tool could be a good starting point.

When you’re comparing pension providers, check online reviews and also make sure the providers you’re considering are authorised and regulated by the Financial Conduct Authority (FCA).

Choosing a pension plan

When you’re choosing a pension plan, you should consider:

  • How will your money be invested, and is the pension fund properly diversified (invested in a range of assets) to manage risk?
  • How has the pension fund performed in the past? (Although remember that past performance is not a guarantee of future performance).
  • Does the pension plan have a minimum or maximum level of contributions, and can you pay in one-off lump sums as well as regular amounts?
  • What pension charges will you have to pay (look out for charges hidden in the smallprint), and are there any exit fees if you choose to leave the plan?
  • Can your employer choose to pay into the pension?
  • How will you be able to manage your pension: is there an online account, and can you check your balance and make contributions online?

When you’re choosing a pension it’s important to read through all the details carefully, checking the pension factsheet and past performance graphs.

The pension that’s right for you will depend on your individual circumstances, including your age, your risk appetite, and how much you plan to pay into your pension. You can seek pension advice if you’re not sure which pension to choose.

PensionBee pension plans

PensionBee combines your old pensions into a new plan that you can manage easily online. You can see your current balance and contribute to your pension in a few clicks. PensionBee plans are managed by BlackRock, State Street Global Advisors and HSBC - three of the biggest investment managers in the world. You’ll only pay a single annual fee. Find out more about the PensionBee plans.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Last edited: 02-05-2024

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