Switching providers could save people thousands of pounds a year in fees, the consumer group said.
Pension savers could potentially save more than £20,000 in the run-up to retirement simply by switching “DIY” providers, Whic ? has found.
Self-invested personal pensions (Sipps) have become a popular way for savers to build and manage their own retirement pot of shares, funds, investment trusts and other assets, often at a cheaper price than traditional pension providers, according to the consumer group.
But Which? warned that savers need to have the time and confidence to build and manage their own investment portfolio.
Which? analysed the core fees charged by popular Sipps providers and found that switching could save people thousands of pounds a year in fees – giving them a potentially huge boost to their pension pot before retirement.
It said annual costs for a £100,000 pot range from £150 to £450.
For a pot worth £250,000, switching from the most to the least expensive Sipp Which? analysed could save consumers nearly £1,000 a year.
It said a Halifax Share Dealing customer would have paid charges of £180 after a year, compared with £1,125 with Hargreaves Lansdown.
Hargreaves Lansdown (HL) told Which?: “HL’s market leading digital wealth management service offers great value for its comprehensive offering, which includes active savings and our award-winning app, and one of the simplest and most transparent charging structures.”
The Which? research estimated that those starting with £250,000 in a Sipp at the age of 50 and retiring at 65 could end up with £22,808 more in their pension pot by choosing the most cost-effective provider over the most expensive.
The difference for those with a £500,000 pot was starker.
Savers could be £1,570 better off per year by switching to the cheapest provider, Which? found, with Halifax Share Dealing again charging customers just £180 in fees while Hargreaves Lansdown was the most expensive in the research at £1,750.
Which? also surveyed more than 1,200 people about their Sipp providers and asked them to rate platforms for factors including investment information and online tools, as well as whether they would recommend it to others.
Fidelity topped the table after it received an excellent overall customer score of 75%. The provider was named a “Which? recommended provider” alongside Vanguard (with a customer score of 72%) and AJ Bell (a score of 72%).
Which? said that, while Halifax’s charging structure made it the cheapest option for pots over £250,000 in its study, it received a relatively low overall customer score (60%).
And although Barclays Smart Investor (73%) pipped Vanguard and AJ Bell on customer score, it was relatively expensive for certain pot sizes and so was not eligible to be a Which? recommended provider.
Aegon had the lowest customer score (59%) in the survey.
An Aegon spokesman said: “We invest heavily in our service and providing an exceptional customer experience is a core part of our strategy.”
Jenny Ross, Which? Money editor, said: “For experienced investors, DIY pensions often come at a cheaper price than traditional pension providers and offer a flexible and straightforward way to save for retirement – but it’s clear that some offer a much better deal than others.
“Our analysis shows the best Sipps combine great customer service with good value for money, and that switching to a cheaper provider can make a startling difference to the size of your retirement pot over time.”