The best & cheapest SIPPs – low cost DIY pensions

21 min Read Published: 29 Jun 2020

cheapest low cost Sipp & best sippThe best SIPP & cheapest SIPP

In this independent SIPP comparison we compare SIPP charges from all the best  SIPP providers to help find the cheapest SIPP for you. A SIPP is short for a Self Invested Personal Pension. Finding a cheap low cost SIPP is only part of the story. In order to find the best SIPP provider for your personal circumstances you must consider more than just cost.

I suggest that you start by downloading the following excellent SIPP guide from the UK's leading SIPP provider which tells you:

  • How to start building a DIY pension pot in minutes by using a SIPP
  • How to benefit from the new pension rules with a SIPP account
  • How to improve your existing pensions and transfer them into a SIPP account
  • How the pension tax rules work including tax relief on SIPP contributions
  • The tax advantages of a SIPP and how they can boost your pension pot

All you need to know about using a SIPP

An excellent easy-to-read guide which tells you how to take advantage of a SIPP to boost your pension

Get the free guide

What is a SIPP?

A SIPP is a DIY pension where investors can choose their own investments. The full title is Self Invested Personal Pension. Traditional personal pensions limit your investment choices to a small number of funds typically run by the pension provider's fund managers. With a SIPP you can invest anywhere you want making your own choice of pension funds and managing them over time. That way you can ensure you are in the best pension funds and maximise your pension fund at retirement.

How do SIPPs work?

A SIPP works in a similar way as investing in a Stocks and Shares ISA via a fund platform, the only difference is that you get income tax relief on your SIPP contributions when investing in a SIPP. Using a SIPP to build a private pension fund gives the investor complete control over their investments to hopefully obtain a greater return than using the limited investment choices of a simple personal pension product, such as a stakeholder pension. The growth of fund supermarkets in recent years has meant the cost of investing in a SIPP has fallen dramatically, often comparable with that of a Stocks and Shares ISA. If you are considering investing in a Stocks and Shares ISA read our guide – The best stocks and shares investment ISA (& the cheapest fund platform).

Should I consider investing in a SIPP pension?

If you are currently in a company pension scheme, particularly one where your employer makes contributions then you will probably be better off remaining in that scheme. If, however, you are investing directly into a personal pension via a pension provider then you may want to consider moving to a Self Invested Personal Pension (SIPP) especially if you are comfortable with choosing your own SIPP funds and regularly monitoring them.

If you wish to learn how to choose which funds to buy and when, even if you are a complete novice, then read my FREE short series of emails which teaches you how. It takes just 2 minutes a day and is the result of thousands of hours of research and a career as an investment analyst. You will learn the simple tools and techniques that the very best fund managers use which you can too when DIY investing.

Of course, if you would rather someone managed your investments for you there are a number of new managed robo-advice pensions which are listed at the foot of this article. They will invest your money for you. However, the rest of this article will assume you are looking to invest your own money in a full SIPP.

What should I look for when choosing a SIPP provider?

If you are simply looking for a cheap SIPP provider then there are a number of pension charges to consider when choosing your SIPP provider. These costs vary depending on what you invest in and how big your pension pot is. Yet the fees charged are only part of the story. Some providers will only allow you to invest in funds, others also offer access to shares and investment trusts. Some cheap SIPP providers offer a basic service while others provide a more comprehensive service including a selection of useful tools and guides to help with your investment research.

The main SIPP charges and costs are:

  • Admin fee – this is typically an annual charge. There might also be further charges applied for transferring money in or out of your SIPP (known as SIPP transfer charges)
  • Dealing charges – this is a fee charged when dealing in funds or shares and they vary between SIPP providers. You need to make sure the provider you choose has a charging structure that meets your requirements
  • Fund manager charges and other fees – fund managers also charge an annual fee. Some SIPP providers negotiate cheaper fund deals and pass this reduction on to their investors. Also check out the fund platform's full fee list for any extra fees charged before you make your final choice

Below, we include a full SIPP comparison of the costs of each SIPP provider so that you can find the cheapest SIPP provider for the size of your pension pot.

However, as previously mentioned, you shouldn’t just focus on cost but instead, consider value for money as well as the level of service provided. If good customer service (including helplines), as well as research and tools, are important to you then you need to look beyond cost. A lot of DIY investors require the ability to buy and sell investments quickly and easily online or via an app – so make sure your SIPP provider will let you. Also not all SIPP providers allow you to invest in shares and investment trusts, something the more experienced DIY investor might want to do. So if this is important to you then check your permitted investment choices.

Which is the best SIPP?

The Best SIPP provider for tools & functionality – Hargreaves Lansdown Vantage SIPP

Hargreaves lansdown stocks and shares Junior ISA Hargreaves Lansdown Vantage SIPP – click for more details

  • reasonably priced and offers excellent investment choice and customer service
  • the most popular SIPP in the UK and winner of numerous Best SIPP awards
  • excellent website and app enabling you to buy and sell investments quickly and easily
  • allows you to invest in shares, unit trusts and investment trusts
  • annual admin charge for funds – 0.45%  up to £250,000, 0.25% for £250,000 to £1m, then 0.10% between £1m and £2m and there is no charge over £2m
  • separate 0.45% charge for holding shares, applied to the whole account, but capped at £200
  • no transfer out fee
  • can start with a minimum lump sum contribution of £500 or a regular monthly contribution of £25

Popular managed pension for beginners – Nutmeg

Nutmeg Nutmeg – click to read our unbiased review

  • one of the few online investment services (robo-adviser) in the market that offers a pension product.
  • ideal for those who want to minimise costs but want someone else to manage the money.
  • Nutmeg offers a choice of 10 portfolios with varying levels of risk. The portfolios are managed on a discretionary basis using low cost ETFs which invest in a range of assets.
  • Nutmeg charges (on top of the ETF annual charges of course) are: 0.75% for anything under £100,000 invested, then 0.35% on any amount over £100,000
  • the minimum initial investment is £500 and Nutmeg does accept transfers-in
  • Nutmeg helps you choose the right portfolio for you once you register to open a pension.
  • Money to the Masses has also secured an exclusive offer that means Nutmeg will waive its management fees for the first 12 months. On a £20,000 investment that is a saving of £150. That makes it not only the cheapest way to invest via Nutmeg but it is also the best offer in the market of any robo-advice firm or investment platform.
  • Read our full unbiased Nutmeg review.

 

Which is the cheapest SIPP provider?

If you are just interested in low cost SIPPs then use our SIPP charges comparison tables below to compare UK SIPP providers and find the cheapest SIPP for your portfolio size. Our calculator takes into account the SIPP fees applied to portfolios ranging in size from £5,000 to £1million to help you find the cheapest SIPP.

Find the cheapest SIPP for you

To compare the market and find the cheapest SIPP for the sum you wish to invest simply use our SIPP comparison heatmap table. Look down the column relevant to your portfolio size and green indicates cheap while red indicates expensive

Find your cheapest SIPP

The cheapest SIPP for most people – A J Bell Youinvest or Vanguard


AJ Bell Youinvest stocks and shares ISA AJ Bell

  • annual charge for funds at 0.25% up to £250,000, 0.10% for £250,000 up to £1m, 0.05% for £1m – £2m, no charge over £2m investment
  • fund dealing is a flat fee of £1.50 online
  • share dealing is £9.95 per deal for zero to nine deals, and £4.95 per deal for 10 or more deals in the previous month
  • £25 for one-off income payment, £100 p.a. for regular payments

A J Bell Youinvest – click for more details


Vanguard Best ISA Vanguard

  • annual charge of just 0.15% per year, capped at £375
  • no admin charges or exit fees
  • no charge for drawdown
  • invest from £500 lump sum or £100 per month

Vanguard – click for more details

Alternatives…


Interactive Investor best ISA Interactive Investor SIPP

  • one of the cheapest SIPPs for those with a pension worth over £50,000 who only want to make few fund switches from time to time
  • 3 service plans to choose from. £9.99, £13.99 or £19.99.
  • Service plan fees include free trade credits that you can use toward trading commissions
  • no exit fees
  • fund dealing and share dealing charges (outside of free trades) are charged at either £3.99 or £7.99
  • £100 plus VAT annual charge

Fidelity Best ISA Fidelity SIPP

  • a low cost SIPP
  • no set up or annual fees
  • just the annual fund admin fee is applied at £45 p.a. flat fee up to £7,500 then 0.35% up to £250K, then 0.2% on larger portfolios up to £1m with no fee charges on assets held above £1m. Fee paid monthly in arrears
  • Online service not as slick as the likes of Hargreaves Vantage SIPP

Alliance trust and savings Alliance Trust and Savings

  • monthly admin charge of £17.50 +VAT for ‘Savings', £23.75 +VAT for ‘Income'
  • buying or selling investments online £9.99 per deal
  • transfer out fee £150 plus VAT maximum

Best Invest Best ISA Bestinvest

  • annual charge for funds and shares of 0.30% up to £250,000 and 0.20% from £250,000 to £1m, no charge over £1m
  • fund dealing is free while share deals will cost you £7.50 per deal
  • there is a £100 plus VAT annual fee payable quarterly
  • transfer out fee is £125 per asset transferred

Charles stanley direct best ISA Charles Stanley

  • annual account charge of £100 +VAT (waived if combined assets across the platform of £30,000)
  • tiered platform fee structure, 0.35% p.a on first £250,000, then 0.20% p.a. between £250,000 and £500,000, 0.15% p.a. between £500,000 and £1m and 0.05% p.a. between £1m and £2m
  • fund dealing is free, share trades online £11.50 per trade
  • transfer out fee £125 +VAT

The share centre best ISA The Share Centre

  • annual admin fee £15 per month.
  • standard dealing fee of 1% with a minimum of £7.50, more frequent traders £7.50 a trade
  • Transferring in is free, transfer out £100 +VAT

The cheapest SIPP provider comparison tables

If you are only focused on getting the cheapest SIPP then the below tables compare SIPP charges for all the major SIPP providers.

The first table shows the cheapest SIPP for those wanting to choose their own underlying investments. Simply look at the column that most closely matches the size of your pension pot for an estimate of the annual cost if your SIPP was held with each fund platform. All the figures in the table show the platform/SIPP charges, ignoring the underlying fund charges which are typically another 1% to 1.5% a year irrespective of which platform you choose.

The second table assumes that you want to invest in shares, investment trusts or ETFs and that you make 20 trades a year. Again, you will have to pay additional charges levied by the funds you invest in on top of the figures quoted but they will be fairly standard across all platforms.

SIPP charges comparison table if you want to pick your own funds (unit trusts)

Platform Minimum investment Fund Buy or Sell costs £5,000 portfolio cost £25,000 portfolio cost £50,000 portfolio cost £100,000 portfolio cost £250,000 portfolio cost £500,000 portfolio cost
£1,000,000 portfolio cost
A J Bell Youinvest £25 per month or start with £1,000 £1.50 £13 £63 £125 £250 £625 £875 £1,375
Alliance Trust Savings £50 £10 £412 £412 £412 £412 £412 £412 £412
Bestinvest £500 Free £135 £195 £270 £420 £870 £1,370 £2,370
Charles Stanley Direct £50 per month or start with £1,000 Free £138 £208 £175 £350 £875 £1,375 £2,375
Close Brothers A.M. Self Directed Service £50 per month. No minimum to start Free £13 £63 £125 £250 £625 £1,125 £2,125
Fidelity SIPP £50 per month or start with £1,000 Free £45 £88 £175 £350 £500 £1,000 £2,000
Halifax Share Dealing £1 £12.50 £340 £340 £430 £430 £430 £430 £430
Hargreaves Lansdown £25 per month or start with £100 Free £23 £113 £225 £450 £1,125 £1,750 £3,000
Interactive Investor* No minimum £3.99 or £7.99 £288 £288 £288 £288 £288 £288 £288
iWeb £1 £5 £190 £190 £280 £280 £280 £280 £280
James Hay Modular iSIPP No minimum Free £197 £247 £309 £434 £625 £1,150 £1,950
Selftrade(now EQi) £50 per month. No minimum to start £10.99 on sell only £174 £234 £309 £434 £809 £1,184 £1,934
Standard Life Level 2 Investments £240 per month or start with £10,000 Free £292 £412 £300 £550 £1,125 £2,000 £4,000
The Share Centre – Standard ** £100 1% or £7.50 min £330 £430 £680 £1,180 £2,680 £5,180 £10,180
The Share Centre – Frequent ** £100 £7.50 £426 £426 £426 £426 £426 £426 £426
Vanguard £100 per month or start with £500 Free £8 £38 £75 £150 £375 £375 £375
Willis Owen £25 Free £30 £150 £300 £500 £875 £1,250 £2,000

* Cost based on the ‘Funds Fan' service plan

** The Share Centre is currently not accepting new SIPP applications

the table assumes you only invest in funds and make 10 fund switches a year

Cheapest stock and shares SIPP if you want to invest in shares, investment trusts or ETFs

Platform Minimum investment Single Trade cost Regular Investing cost £5,000 portfolio cost £10,000 portfolio cost £20,000 portfolio cost £50,000 portfolio cost £100,000 portfolio cost
£250,000 portfolio cost
AJ Bell Youinvest £25 per month or start with £1,000 £9.95 £1.50 £212 £224 £249 £299 £299 £299
Alliance Trust Savings £50 £9.99 £1.50 £412 £412 £412 £412 £412 £412
Barclays No minimum £6.00 £1.00 £318 £318 £318 £320 £370 £520
Bestinvest £500 £7.50 £290 £305 £335 £425 £575 £1,025
Charles Stanley Direct £50 per month or start with £1,000 £11.50 £373 £390 £425 £405 £470 £470
Close Brothers Self Directed Service £50 per month. No minimum to start £8.95 £192 £204 £229 £304 £429 £804
Fidelity Personal Investing £50 per month or start with £1,000 £10.00 £245 £245 £245 £245 £245 £245
Halifax Share Dealing £1 £12.50 £2.00 £340 £340 £340 £430 £430 £430
Hargreaves Lansdown £25 per month or start with £100 £11.95 £1.50 £262 £284 £329 £439 £439 £439
iDealing £1,000 £9.90 £218 £218 £218 £218 £218 £218
IG £250 £8.00 £365 £365 £365 £365 £365 £365
Interactive Investor * £1 £3.99 £288 £288 £288 £288 £288 £288
iWeb – £25 fee to open an account No minimum £5.00 £215 £215 £215 £305 £305 £305
Selftrade (now EQi) £50 per month. No minimum to start £10.99 £1.50 £159 £159 £159 £159 £159 £159
Sharedeal £240 per month or start with £10,000 £9.50 £310 £310 £310 £310 £310 £310
Strawberry £100 £7.50 minimim or 0.04% £174 £180 £210 £300 £1,000 £2,500
The Share Centre Standard £100 £7.50 or 1% £330 £330 £380 £680 £1,180 £2,680
The Share Centre Frequent £100 per month or start with £500 £7.50 £426 £426 £426 £426 £426 £426
Willis Owen £25 £7.50 £1.50 £180 £210 £270 £450 £650 £1,025

* Cost based on the ‘Funds Fan' service plan

** The Share Centre is currently not accepting new SIPP applications

the table assumes that you want to invest in shares, investment trusts or ETFs and that you make 20 trades a year

Cheapest Robo-advice pension (managed pensions)

There has been an explosion in the number of online only companies offering managed investment services. These so-called robo-advisers tend to focus on offering their services via a stocks and shares ISA. However, a number now offer a pension product. The tables below compares the cost of the robo-advice pensions currently available. The difference between these managed pensions and the SIPPs listed in the table above is that the robo-advice companies below run your money for you whereas the above SIPPs require you to pick your own investments yourself. The first table below is comparable to the one above for the DIY SIPPs because it strips out the underlying fund charges. The second table below compares the total cost of the pension including the underlying fund charges.

Robo-advice pension management fee comparison (i.e. without fund charges)

Robo Adviser Minimum investment £5,000 portfolio cost £25,000 portfolio cost £50,000 portfolio cost £100,000 portfolio cost £250,000 portfolio cost £500,000 portfolio cost
£1,000,000 portfolio cost
evestor £1 £18 £88 £175 £350 £875 £1,750 £3,500
Nutmeg fully managed £500 £38 £188 £375 £750 £1,275 £2,150 £3,900
Moneyfarm £100 per month and £1,500 or if no monthly contribution, £5,000 minimum £38 £165 £315 £565 £1,090 £1,965 £3,715
Wealthify £50 £30 £150 £300 £600 £1,500 £3,000 £6,000
Wealthsimple No Minimum £35 £175 £350 £700 £1,250 £2,500 £5,000

Robo-advice pension comparison – total costs

Robo Adviser Minimum investment £5,000 portfolio £25,000 portfolio £50,000 portfolio £100,000 portfolio £250,000 portfolio £500,000 portfolio
£1,000,000 portfolio
evestor £1 £25 £123 £245 £490 £1,225 £2,450 £4,900
Nutmeg fully managed £500 £50 £250 £500 £1,000 £1,500 £3,000 £6,000
Moneyfarm £100 per month and £1,500 or if no monthly contribution, £5,000 minimum £52 £223 £445 £790 £1,600 £3,200 £6,400
Wealthify £50 £41 £205 £410 £820 £2,050 £4,100 £8,200
Wealthsimple No Minimum £45 £225 £450 £900 £1,750 £3,500 £7,000

 

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