PensionBee Review: A Simple Way To Consolidate All Your Old Pensions Into One Customer Reviews & Expert Rating

PensionBee is a great way to track down all your old pensions and combine them into one easy-to-manage online pension in a range of different plans managed by established fund managers like State Street, Blackrock and Legal & General.

PensionBee is a good choice for those who want a hassle-free pension and are looking to consolidate old pensions into one account. 

Market Access: What investments does PensionBee offer?

PensionBee offers customers a range of investment plans. These are managed by large-scale global money managers such as BlackRock, HSBC, and Legal & General and have different risk levels.

The plans on offer include:

• Tracker – This invests your money in a mix of global shares and bonds.
• Tailored – This is essentially a ‘target-date fund’ that invests your money differently as you go through life, moving your money into safer investments as you get older.
• Fossil Fuel Free – This is a sustainable investing plan.
• Impact – This plan invests in companies addressing the world’s greatest social and environmental needs.
• 4Plus – The aim of this plan is to achieve long-term growth of 4% per year above the cash rate.
• Shariah – With this plan, your money is invested in Shariah-compliant companies.
• Preserve – This is a lower-risk plan that makes short-term investments in creditworthy companies.
• Pre-annuity – This invests your money in bonds to provide you with returns that broadly correspond to the cost of purchasing an annuity.

Looking at this range of plans, PensionBee’s offering is a little limited compared to those of rivals. For example, competitors such as Moneybox and Nutmeg offer far more investment options.

How have PensionBee’s plans performed?

PensionBee display their pension plan returns on an average annual basis so you can see how much you would have made on average if you’d been invested with you.  The best performing PensionBee pension fund is the Shariah managed by HSBC/State Street, which has seen average annual returns of over 16%, mainly because it contains 100% stocks and shares like Nvidia, Apple, Microsoft and Meta, which are higher risk than including bonds.

However, PensionBee also has pension plans for older investors, which take on less risk like the 4Plus, which only has annual returns of just over 5%. This is fine because the closer you get to the pension age, the less risk you should take.

What is interesting about this is that even though some plans have performed very well, as a recent survey from PensionBee found that out of 1,000 UK adults, only 8% we prepared to take on a high amount of risk for their pension. 46% said they wanted moderate risk, and 26% opted for lower risk investments. Surprisingly, 5% said they didn’t care and wanted the professionals to make all the decisions for them.

Fees: 

With PensionBee, you pay one simple annual fee of between 0.50% and 0.95% per year depending on the plan you choose. This fee is calculated daily and automatically deducted from your account each month (or when you switch or transfer your plan).

Note that if your pension is larger than £100,000, the company will halve the fee on the portion of your savings over this amount. So, for example, if you have £120,000 in the Tracker plan, the fee for £20,000 of the £120,000 will be reduced from 0.50% to 0.25%.

Now, some of PensionBee’s fees are pretty competitive (i.e. 0.50% for the Tracker plan). But they can be beaten. With Vanguard, for example, it’s possible to pay around 0.25% annually.

Is it worth consolidating your pensions with PensionBee?

There are several benefits of consolidating your old pensions into one account. For a start, bringing together your different accounts makes it much easier to manage your money. When your retirement savings are all in one place, monitoring your investments takes less time and it’s much easier to work out if you’re on track for retirement.

Combining pensions also allows for a better understanding of your asset allocation. If your money is spread out over many different pension providers, it can be difficult to keep track of your asset mix and know how much risk you’re taking on.

Additionally, consolidating your pensions can enable you to lower your costs. Today, many pension providers, including PensionBee, have tiered fee structures where annual charges are lower for higher account balances.

It’s worth pointing out that a pension consolidation is not always the best move. If you are a member of a defined benefit pension scheme, or you have a pension that comes with valuable benefits such as guaranteed annuity rates, you may be better off sticking with your current provider.

Is it easy to withdraw money from PensionBee?

With PensionBee, you have to follow standard UK pension rules. So, you cannot withdraw your money until age 55 (57 from 2028). When you reach the age of 55, you can either take your pension flexibly online through PensionBee drawdown, or you can buy a pension annuity through Legal & General. Note that at 55, you can only withdraw 25% of your pension tax-free.

What do you need to open a PensionBee pension?

Opening an account with PensionBee is a straightforward process. You can sign up either online or via the app. When signing up, you’ll need to provide some basic details such as your legal name, your current address, your date of birth, and your National Insurance number. If you wish to transfer old pensions to PensionBee, simply tell PensionBee the names of your old pension providers and some basic information and they will do the rest.

PensionBee Alternatives

If you’re looking for a pension or SIPP provider, some other options include:

• Hargreaves Lansdown – With a Hargreaves Lansdown SIPP, you have access to thousands of different investments.
• Moneybox – Moneybox offers access to investment funds, ETFs, and US stocks.
• Nutmeg – Nutmeg also offers a range of ready-made portfolios and has ESG options.
• Vanguard – Vanguard offers extremely low fees and a wide range of funds.