Best SIPPs: switching provider could save £2,570 a year
By Liam Buckler ·
People with self-invested personal pensions (SIPPs) could save as much as £2,570 a year on a £1 million pension by switching provider, according to new research.
Newspage analysis, conducted in October 2026, compared the annual platform charges applied to pension pots of different sizes.
Platform charges are what providers collect for administering a SIPP and are separate from charges levied by investment funds, as well as certain dealing and other administration costs.
Under the investment assumptions used, a £50,000 pension would cost £200 a year with Bestinvest and £72 with Interactive Investor, producing a £128 difference.
With £1 million invested in funds, the annual charge would be £2,750 with Hargreaves Lansdown and £180 with Interactive Investor – a gap of £2,570.
The figures demonstrate how the charging structure can become as important as the headline percentage.
Bestinvest, for example, currently charges 0.4% on third-party funds and UK shares within the first £250,000, while offering lower charges on its ready-made portfolios.
Hargreaves Lansdown charges 0.35% on the first £250,000 held in funds and 0.25% on the portion between £250,000 and £1 million.
Which is the cheapest SIPP?
There is no single cheapest SIPP for every saver. The cost depends on the value of the pension, the investments it holds, how frequently the customer trades and whether they use services such as pension drawdown.
Antonia Medlicott, Founder at London-based Investing Insiders, said: "In my experience, flat-fee SIPP providers start to look cheaper once your pension pot reaches around £30,000–£75,000, although the exact crossover point depends on the provider, what you're invested in and how often you buy and sell investments.
"For example, for a £20,000 pension invested in funds, AJ Bell's 0.25% platform fee would be £50 a year, compared with £71.88 a year for interactive investor's Core plan, before investment charges and dealing fees.
"But for a £100,000 pension invested in funds, AJ Bell's percentage-based platform fee would be around £250 a year, compared with just £71.88 for interactive investor's fixed-fee 'Core' plan.
“The FX (foreign exchange) fee is the one we find people most often forget about. This fee applies when your money is converted between currencies, for example, if you deposit pension contributions in pound sterling but want to buy US stocks.
"FX fees can vary massively between providers and potentially take a big chunk out of your returns.”
When does a flat-fee SIPP become cheaper?
Percentage-based charges generally increase with the value of the pension, whereas a flat platform charge can remain unchanged as the pot grows.
However, savers must compare all the applicable charges rather than looking only at the main platform fee.
David Stirling, Independent Financial Adviser at Belfast-based Mint Wealth, warned that percentage fees can mislead savers.
He said: “SIPP charges can look deceptively small because they’re quoted as percentages. At 0.4%, the same charge rises from £400 on £100,000 to £4,000 on £1m, so as pension pots grow the case for checking flat-fee alternatives becomes much stronger.
“Most people have only a vague idea what their pension is costing once all the extras are included, and the 2027 inheritance tax changes are another good reason to review both the pension and its charges.
“Cost matters, but the cheapest SIPP isn’t automatically the best, any more than the cheapest hotel is necessarily somewhere you’d want to spend your retirement.”
Is the cheapest SIPP always the best?
Price is only one part of the comparison. A low-cost provider may not offer the investments, retirement options or level of customer service a saver requires, while frequent dealing can substantially alter the total cost.
Rob Mansfield, Independent Financial Advisor at Tonbridge-based Rootes Wealth Management, argued that savers are asking the wrong question.
He said: "The conversation always revolves around charges but that's the wrong way of looking at it. It's the easiest thing to control because none of us know what future investment returns will be but it's better to focus on features and the value that's being provided. We don't all have the cheapest phones or cars, because that's not always where the best value is.
“Pensions are the same. The key is working out what matters to you and balancing investment choice, fees and customer service. When you need your money, you want to know that the provider is ready to act and will be helpful.”
What should you check before switching a SIPP?
Savers should establish which investments they want to hold and compare platform, fund, dealing, transfer, drawdown and administration charges.
They should also check the retirement options and service available before transferring solely to obtain a lower headline fee.
Samuel Mather-Holgate, Managing Director at Swindon-based Mather and Murray Financial, said savers should first work out what kind of SIPP they need.
He said: "Not all SIPPs are created equal. Some are designed to hold complex investments, while others are simply platforms offering access to funds and shares.
"Paying for bells and whistles you don’t need can quietly eat away at your retirement. As pension pots grow, percentage-based fees can become increasingly expensive, making flat-fee arrangements more attractive. But cheaper isn’t always better. Investment choice, dealing costs, drawdown charges and service all matter.
“Many savers focus on investment performance while overlooking the charges steadily chipping away at their returns. Over decades, seemingly small differences can cost thousands.
“With unused pensions entering the inheritance tax net from April 2027, reviewing pension arrangements is becoming even more important. The right SIPP isn’t necessarily the cheapest. It’s the one that offers the right flexibility and value for the size and complexity of your pension.”
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