Thinking about preparing for retirement? Compare our best private pensions from some of the UK's leading providers and find a plan to help your money go further when you retire.
You'll only find results from genuine companies. Our data experts check each company before we add them to our comparisons.
Private pensions let you choose exactly how much you're putting away for retirement as well as what that cash is invested in. To open one, simply:
Select a provider
Fill out some details
Decide your contribution levels
Regularly review your investments
Pensions are long term investments. You may get back less than you originally paid in because your capital is not guaranteed and charges may apply.
There are three sorts of pensions in the UK - each offering something different.
State pensions are "qualifying benefits" where what you get is based on your National Insurance contributions.
You need 10 qualifying years to be able to claim a state pension, and get the full payout after 35 years.
State pensions are paid out weekly to people who qualify, once you pass retirement age.
Currently the full new state pension pays £185.15 a week.
Private pensions let you pay into a pot of money yourself, or on someone else's behalf.
The Government offers a substantial tax break for money paid into private pensions.
What you pay in and where it's invested is up to you - but you can't draw on the money until you're at least 55.
You can use the money however you like once you pass a set age.
Employers have to enrol all staff aged between 22 and 66 who make more than £10,000 a year into pensions when they join - and top up what they save too.
The money either goes into a savings pot on your behalf, or into a fund run by your employer that will pay out a set percentage of your salary in retirement.
While you'll be automatically enrolled into a pensions scheme when you join, you can opt out if you want - although that means you sacrifice the top ups from your employer too.
Private pensions are a way of saving for retirement. They're pots of money that offer large tax breaks when you pay in, but that you can't access until you're 55 (or 57 after 2028¹).
The Government adds 20% to your contributions if you're a basic-rate taxpayer, 40% if you're a higher-rate taxpayer and so on depending on your tax band until you hit the annual or lifetime limit.
If you don't pay income tax, you get 20% added to the first £3,600 paid in a year.
Any growth of money held in a private pension is free from income and capital gains tax.
When you access your pension, you can take 25% of your savings as a tax-free lump sum. After that, money withdrawn from pension funds is taxed the same way as income.
But be careful – once you've accessed your pension, you're only allowed to pay in £4,000 a year to get the tax benefits – something to watch out for if you're still working at the time.
There are two main types of private pension offered by the companies in our comparison service.
With a personal pension plan, you appoint a pension company and they choose the funds you invest in or give you a limited set of options. The money is put into investments (such as shares) on your behalf by the pension provider.
With a SIPP, you choose where you invest your cash. You can think of it as a kind of DIY pension plan. There's a large list of funds, shares and other assets to choose from. You can even use it to buy property.
If you don't want to choose your own pension funds then speak to an independent financial adviser to talk about the best pension plans for you.
"When choosing a private pension there are two main things to look at - charges and choice.
"High fees eat into your money, making any returns you make smaller, and over time the effect on your fund can be significant.
"Choice of investments is very much a personal matter - some people value the ability to pick exactly who and what they put money into highly, others would rather let someone else do it for them."
If you are an employee who makes more than £10,000 a year from a single job and are aged between 22 and 66, you will be automatically enrolled into a pension at work - although you can choose to opt out.
Your workplace pension can be one of two types:
With defined contribution pensions you pay money into a pot, which then grows in much the same way as a private pension.
The minimum contribution is 5% of your pre-tax salary. Your employer adds 3% on top of this. Many firms allow you to pay additional voluntary contributions, while others will top up your money by more than 3%.
With defined benefit pensions you are paid a percentage of your salary at retirement for each year that you contributed.
Over your career, it's likely you'll build up a few pension pots. The good news is you can transfer one pension into another - either your current workplace one or a private pension - if you want to keep things simple.
|Private pension||Workplace pension|
|Choice of provider||Yes||No|
|Choice of investments||Yes||Maybe|
|Government top up||Yes||Yes|
|Employer top up||No||Yes|
The idea behind the tax break on a pension is simple - to only tax you on the money once.
So income tax is paid back on private pensions and workplace pension contributions are taken from your salary before tax is applied. Once in a pension pot, any growth in your savings is also largely tax-free².
This is designed to compensate for the fact money you take out of your pension is generally taxed as if it was paid as income by an employer that year.
However, there are limits to the tax relief on private pensions:
You can only pay in the equivalent to your annual salary in any given year - with a hard limit of £40,000 no matter what you earn
There is a lifetime limit on what you can have saved up in your pension overall and still get tax breaks on contributions - currently £1,073,100
Once you start drawing on the money you've saved into your pension, the amount you can put away each year and still get a tax break falls to just £4,000
There are three groups that regulate how pension contributions and investments are being looked after. You should always check before you invest that your money will be protected.
This looks after workplace pensions in the UK - both defined contribution and defined benefit
This regulates private pension schemes including SIPPs and personal pension plans
Protects people with defined benefit pensions, and pays out instead of your company if it goes bust
How much compensation you receive, will depend on the sort of pension you have and who regulates it.
SIPP holders can claim up to £85,000 back from the Financial Services Compensation Scheme if the UK-regulated provider of the investment fails.
The FSCS can also cover 100% of the loss, with no upper limit, if your pension plan is classed as a "contract of long term insurance" - as is the case with most annuities³.
With failed defined benefit schemes, the PPF steps in. It allows people already claiming their pension to continue to receive their promised payouts, while people yet to claim are offered up to 90% of their pension.
Every pension company found in our private pension comparison is FCA regulated.
Yes. You might want to transfer your pension in the following cases:
you've changed jobs and would like to combine pensions into a single pot
your current pension scheme is closing
you've found a better deal on a private pension
You're allowed to transfer pension savings between registered UK pension providers and keep all your tax-free benefits.
If you transfer your pension pot anywhere else - or take it as an unauthorised lump sum - it will be classed as "unauthorised payment" and you’ll have to pay tax on the transfer.
To transfer your pension contact, you need to check if:
your existing scheme allows transfers out
your new scheme accepts transfers in
You might need to make payments to the new scheme and be charged a fee by your existing scheme to make the transfer.
It's also possible that making the switch will mean you lose the right to take your pension at a certain age or any rights you had to take a tax-free lump sum of more than 25%.
Your pension providers will be able to tell you if any of these conditions apply.
As much as you like, but only the first £40,000 you pay will be tax free. Anything above this is taxed at your level of income tax. There's also a lifetime limit on how much you can have saved in total in your pension and still get tax relief - although the exact level changes depending on the type of scheme you have.
The general advice for pensions is to contribute as much as you can as early as possible. A good rule of thumb is to take your age, halve it and contribute that percentage of your income into your pension to have a comfortable retirement.
So if you're 30, then you should contribute 15% of your income to your pension.
No, however you should only set up a pension if you fully understand the risks involved.
Technically there's no limit on how much money you can put into your private pension, UK wide. You can save as much as you like. But it's important to remember that there are limits on the tax relief you can get.
See our full set of pensions guides here.
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Our comparison tables include providers we have commercial arrangements with. The number of listings in our tables can vary depending on the terms of those arrangements, as well as other market developments. They are all from providers regulated by the Financial Conduct Authority (FCA).
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¹The age you can access your private pension is set to rise to 57 in 2028 under current Government plans, however if your pension scheme says you can access your money at 55, you will continue to be able to do that no matter what year it happens in
²Growth in money held in a pension is free from capital gains and income tax, but dividends paid by shares held in the fund do attract a 10% tax
Last updated: 4 May 2022