Vanguard set to launch the UK’s cheapest-ever pension fund

Vanguard, the giant US asset management company, is set to launch a self-invested personal pension (Sipp) with an annual fee of just 0.15%

Good news for pension savers worried about charges – as all pension savers should be. Vanguard, the giant US asset management company, is set to launch the UK’s cheapest-ever pension fund.

Vanguard has been promising a new pension product for more than two years. But the long wait appears to have been worth it. The group’s self-invested personal pension (Sipp) will carry an annual fee of just 0.15%, with charges capped at £375. That’s less than half the cost of similar Sipps elsewhere.

Savers opening a Vanguard pension will have to pay additional charges on the underlying funds in which they invest, as well as transaction costs when buying and selling investments. But that’s true of other Sipps too and independent analysis suggests that for the typical saver, Vanguard’s new product will be the cheapest deal going.

Pension advisers expect the new plan to be popular, which should prompt rival providers to review their own charges. In which case, fees could drop across the board in 2020 – and if you already have a Sipp, it’s worth reviewing the market to see if you’re getting the best deal.

Recommended

Mind the inheritance-tax trap when transferring your pension
Pensions

Mind the inheritance-tax trap when transferring your pension

Transferring your pension could incur inheritance tax for your heirs, says David Prosser.
9 Sep 2020
How to fight the fraudsters coming for your pension pot
Personal finance

How to fight the fraudsters coming for your pension pot

Investment and pension scams have proliferated during lockdown. Here’s how to protect yourself.
8 Sep 2020
How to claw back tax overpaid when opting for pension drawdown
Pensions

How to claw back tax overpaid when opting for pension drawdown

Many retirees opting for drawdown schemes – taking money out of their pension savings – have overpaid tax. Here’s what to do to get it back.
26 Aug 2020
Pandemic sparks annuities panic among retirees
Pensions

Pandemic sparks annuities panic among retirees

Savers’ appetite for annuities appears to have increased sharply during the Covid-19 pandemic.
21 Aug 2020

Most Popular

Will a second wave of Covid lead to another stockmarket crash?
Stockmarkets

Will a second wave of Covid lead to another stockmarket crash?

Can we expect to see another lockdown like in March, and what will that mean for your money? John Stepek explains.
18 Sep 2020
Here’s why you really should own at least some bitcoin
Bitcoin

Here’s why you really should own at least some bitcoin

While bitcoin is having a quiet year – at least in relative terms – its potential to become the default cash system for the internet is undiminished, …
16 Sep 2020
James Ferguson: How bad data is driving fear of a second wave of Covid-19
UK Economy

James Ferguson: How bad data is driving fear of a second wave of Covid-19

Merryn and John talk to MoneyWeek regular James Ferguson about the rise in infections in coronavirus and what the data is really telling us.
17 Sep 2020