The average adult in the UK saves for retirement almost exclusively through their employer-based pension programs. While that was a surefire way to fund life after work for previous generations, it’s not guaranteed to work now.
Today, workers in the UK change jobs every few years. And every time they go, their new employer opens a pension for them. It’s not uncommon for workers to have multiple pensions. Not all of those pensions are well managed. If you’re not careful, some will lose any gains made in high management fees.
Enter PensionBee. PensionBee’s goal is to serve as a solution to the multiple pension pot problem. The service makes it easy to roll multiple pension pots into one. Not only does rolling over multiple pensions make it easier to keep track of those pensions, but it helps you make the most of the money by rescuing pensions from poorly managed accounts or those with high fees.
Does PensionBee succeed in its mission? Keep reading for our full Pension Bee review.
PensionBee Product Range
PensionBee does pensions – and nothing else. This is great news because so many fintech startups and online investment platforms try to do it all and ultimately outsource pensions to another firm that’s better suited for pension management.
Let’s start with the pensions.
Within PensionBee’s product range, there are nine PensionBee plans to choose from (listed below including the fund manager):
- PensionBee Tracker (State Street)
- PensionBee Match (BlackRock)
- PensionBee Tailored (BlackRock)
- PensionBee Future World (Legal & General)
- PensionBee 4 Plus (State Street)
- PensionBee Shariah (HSBC and State Street)
- PensionBee Preserve (State Street)
- PensionBee Fossil Fuel Free (Legal & General)
- PensionBee Pre-Annuity (State Street)
Each fund has a different asset mix and fee schedule. Some, like PensionBee Tracker and PensionBee match, are relatively similar.
However, once you dive in, PensionBee Future World and PensionBee Shariah do have unique offerings.
PensionBee Future World launched in 2017, and it’s PensionBee’s attempt at providing an ethical investment tool. It offers a 100% equities mix with a low carbon focus. However, like many other ethical funds, the ‘ethics’ only go so far. You won’t be completely divested from fossil fuels by choosing the Future World fund.
The most unique portfolio is the PensionBee Sharia portfolio. It invests in Shariah-compliant companies, which allows those who want to invest but do so in a way that acknowledges their faith.
We’ll cover each portfolio’s details more in-depth later.
If you have multiple pensions, you can use the UK Government’s pension tracing service. It’s far from efficient and not very user-friendly. However, it is free and secure. Those two features in themselves stand out as pension scams continue to plague the public.
Once you have the name of your pension provider, PensionBee will do all the hard work for you, contacting the provider and making all arrangements for your pension to be transferred to PensionBee.
Research Services & Tools
PensionBee doesn’t allow you to conduct transactions on your own. While everyone with a pension should have a basic knowledge of how pensions and investments work, you don’t need access to in-depth education, charting, or tools to use PensionBee’s service.
Even still, PensionBee does provide helpful access to basic info on its platform.
You’ll find four types of information on the PensionBee site:
- A guide to pensions
- Sustainable investing tips
- PensionBee’s blog
The guide to pensions introduces new savers and investors to the concept of pensions. It covers:
- Pension basics
- Pension types
- Finding and transferring pensions
- Pension contributions
- Pension withdrawal
- Pension rules
You’ll find the info you need both in posts and in video form.
The PensionBee blog is the provider’s attempt to simplify the saving and investing process. The platform provides articles on budgeting, saving, consolidating, and drawing down your pensions. PensionBee’s writers also cover some FAQs, including questions about economic uncertainty. You’ll also find the occasional article on PensionBee’s activities.
Finally, it’s worth noting that PensionBee is not a financial adviser, and it doesn’t provide access to those services. If you’re looking for advice, you need to seek that out separately.
Fees & Charges
PensionBee UK accounts come with tiered account fees.
PensionBee positions itself as a simple, low-cost solution for everything related to your pension. Its claims stand up: PensionBee’s fees are competitive with other pension providers, including the robo advisor Nutmeg.
The big fee you need to watch out for in a pension product is the annual management fee. PensionBee’s annual management fees range between 0.50% and 0.95%. These fees depend on the type of account you choose.
PensionBee’s full annual management fee only applies to your first £100,000. Once you reach £100,000, the fee is half on the portion of your savings over £100,000.
The platform automatically deducts a portion of the annual fee daily, so you won’t see a big drop at the end of the financial year. It happens gradually, which some new savers may find comforting.
PensionBee doesn’t charge fees on transferring, combining, contributing to, and withdrawing from your pensions.
However, like all providers, there are exceptions to this rule. For example, if you transfer your pension to PensionBee and then withdraw your entire pension within 12 months, then you will pay hefty exit fees totaling £480. The fee applies to encourage you to drawdown over time rather than grabbing all your money and running.
You’ll also pay transaction costs, which occur no matter where you put your pension. Transaction costs come from the money managers who take care of and invest your money on your behalf. Each plan has different transaction costs, but most are very small. According to PensionBee, you’ll spend an average weighted cost of 0.03%. The transaction fees range from -0.03% to 0.27%. If you want to stay on top of every penny, PensionBee offers a guide to transaction costs and how they’re calculated in a simplified form.
One of the things we like about PensionBee is they make it easy to see how fees will impact your pension pot with a visual. We particularly like that the team displays the amount you pay both in the fee percentage and what it costs in sterling.
For example, if you have a £50,000 pension pot, and you choose the Tracker program (PensionBee’s cheapest pension plan), then you’ll pay a 0.50% annual fee. What does it cost you? You’ll spend £250 annually on fees. At a pension pot of £500,000, you’ll spend £1,500 annually.
Your pensions are non-leveraged products, There’s no spread betting allowed in tax-efficient products. What’s more, PensionBee’s products are fully-managed, so you don’t have the option to conduct your own investment strategy.
You can’t invest in leveraged products with PensionBee.
PensionBee does what it says on the tin: pensions.
You can access your pension details via the Beehive, which is the PensionBee dashboard. The dashboard shows you your balance, provides your plan details, and tells you how much you need to save per month to reach your retirement goals. PensionBee also runs a mobile app with the dashboard, so you can check-in at any time.
At this point, you know PensionBee’s primary value is in its ability to roll multiple pensions into one. Once you do that, you need to choose from one of PensionBee’s plans.
The good news: once you choose a plan, you’re not stuck with it. You can switch between plans at no cost.
PensionBee delivers a competitive pension product, and it often picks up where other providers leave off.
All PensionBee products are actively managed, but their fees are competitive with even robo advisors. Using global investment managers to cover their products is a smart move and it instils confidence in investors. Often, management from BlackRock or State Street would either be too costly for the average pension holder or would be out of reach entirely due to account minimums. PensionBee’s pension products are a chance to enjoy global expertise at what could be considered ‘mate’s rates’.
There are limited investment services offered, which may be problematic once you reach the point where you consider drawdown.
Overall, PensionBee makes pensions more accessible in all the ways that matter. They make it easy to combine pensions, offer low fees, and make it simple to visualise your retirement income in its Beehive dashboard. The Beehive makes understanding your pension as easy as reading your current account statement. So, even if your eyes glaze over every time someone mentions investing or pensions, you can still get in and get out and know exactly what’s in your account.
Here are the details on PensionBee plans:
The tailored plan is the most popular plan. It changes up the investment strategy as you age to create more risk during your younger years and transfer to a safer strategy once you start approaching retirement.
The mix is typically 69% equities, 31% fixed income, and 1% commodities.
- Annual fee: 0.70% on up to £100,000
- Management: BlackRock
The Tracker plan invests your money in the world markets.
Pension Bee considers the Tracker its ‘fix it and forget it’ pension. The mix includes 80% equities, 15% fixed income, and 5% cash.
The risk is on the higher end (5 on a scale of 7), but it is PensionBee’s lowest-cost plan.
- Annual fee: 0.50%
- Management: State Street Global Advisors
The 4Plus plan aims to grow your pension pot by 4% per year.
State Street actively manages this pension with a diverse investment mix:
- 20% equity
- 35% fixed income
- 35% cash
- 3% property
- 8% commodities
Annual fee: 0.95%
Management: State Street Global Advisors
Future World is an environmentally-friendly portfolio. Everything goes into equities, and 49% of your investment falls in the North American markets.
The Future world plan is the highest risk profile on offer: it’s a 9 out of 10. It’s also one of the more expensive plans, but that’s not uncommon among green or ethical portfolios.
- Annual fee: 0.95%
- Management: Legal & General
As we mentioned above, the Shariah plan is one of the unique value adds offered by Pension Bee.
The plan invests your funds only into Shariah-compliant companies approved by an independent Shariah committee.
The investment is 100% equity-based. It is expensive, but it’s actively managed and hard to find something equivalent in the UK market.
- Annual fee: 0.95%
- Management: HSBC
Preserve is a portfolio for the risk-averse. It invests in creditworthy companies, but it only uses a short-term scheme. This plan is very low risk but also generates very low returns. It’s 100% fixed income.
- Annual fee: 0.50%
- Management: State Street Global Advisors
Match is a portfolio that mimics the pension industry in general. PensionBee describes it as an automated way of following the ‘smart money’.
Your investment mix will include:
- 60% equity
- 25% fixed income
- 15% other
Annual fee: 0.60%
The newest addition to the PensionBee plans, the Fossil Free fund completely excludes all fossil fuel producers, tobacco companies, manufacturers of controversial weapons and persistent violators of the UN Global Compact. Whilst it potentially offers higher rewards than the other funds on offer at PensionBee, it is also high risk.
Your investment mix will include:
- 100% equity
- Annual fee: 0.75%
- Management: Legal & General
Opening an Account
First, you need to know that you can transfer a pension into PensionBee. Self-employed customers who don’t have an existing pension can now open a brand new pension with PensionBee, where they can contribute as much or as little as they like, pausing contributions at any time.
You can open your account using PensionBee’s sign up page.
You’ll need to provide your name, contact details, and National Insurance number to get started.
We like PensionBee because it walks you through an easy sign-up process. There’s no printing, scanning, or mailing involved.
In some cases, you may need to receive some paperwork to sign. Usually, this occurs when you have an older pension provider and they won’t accept your digital signature.
The good news is that you have a dedicated BeeKeeper (customer service agent) to help you out. They explain the whole process to you as it applies to your past pension providers.
Here’s a standout feature for UK residents who aren’t UK nationals: anyone with a UK pension can become a customer. PensionBee doesn’t bar any customers from its service based on their nationality or tax residency. So, if you are a U.S. citizen, then you can use PensionBee to consolidate your pensions.
Tax relief is another issue, but those are rules made by the UK government – not PensionBee.
Additionally, you should know that you can’t transfer a public service pension into PensionBee. The government doesn’t allow you to transfer unfunded government pensions, which includes NHS, civil service, police, firefighters, and the army. It also applies to most local government pensions.
Transferring Your Pensions to PensionBee
PensionBee’s big promise is its offer of simplicity. It caters to customers who want to take all their different pension pots and put them in one place, which simplifies fees and drawdown later.
You can use PensionBee’s pension finder tool to gather up and transfer all your pensions (bar civil service and international pensions) and combine them into a PensionBee portfolio.
Keep in mind that there are restrictions on transfers. You can’t transfer a pension with guaranteed benefits over £30,000. The government won’t allow this: you need to get financial advice before you can transfer pensions that meet this criteria.
PensionBee’s customer service happens in two tiers. If you aren’t yet a PensionBee account holder, then you can get in touch via phone, email, or live chat. The contact details are below.
However, once you are a customer, you then receive the help of a customer service team call the PensionBee BeeKeepers. They can access your account and information to help answer questions and resolve any issues that appear. You can get in touch with your dedicated BeeKeeper by phone, email, and live chat.
Reviews from TrustPilot show that current customers are happy with how professional and efficient their BeeKeepers are. They appreciate that the process of opening an account goes smoothly and they find the communication from BeeKeepers to be adequate. The BeeKeepers make sure there are no surprises, but the service is also adequate enough that the BeeKeepers don’t need to run around fixing mistakes or bottlenecks caused by the platform.
Who is PensionBee Suitable for?
PensionBee is suitable for anyone with pre-existing pension accounts who wants to simplify their finances. The range of PensionBee plans allow you to invest in a way that makes the most sense for your age and finances – and even your religion or world-view.
The plans range from very, very conservative to high-risk. However, PensionBee doesn’t provide financial advice, so you may still choose to talk to a financial adviser before you select a plan.
PensionBee isn’t suitable for anyone in the civil service or who has a government pension. You can’t transfer a government pension, so there’s little point in having an account unless you have other pensions from past jobs or careers that you want to merge.
PensionBee is suitable for experienced investors. However, it doesn’t offer any interaction or challenging experiences, so it’s unlikely to be your preferred platform. Even still, many experienced investors do put at least part of their pots in a low-cost robo advisor setting as a means of saving money and experiencing the benefits offered by these services.
Who Owns PensionBee?
PensionBee is a privately owned investment and pension management company operating in London. Founded in 2014 and in service since 2016, the company now has over 315,000 customers.
PensionBee works with global investment banks, but their work is a partnership. At present, PensionBee isn’t a subsidiary of BlackRock, HSBC, or another investment bank.
How Safe is PensionBee?
You put your money at risk every time you invest in the markets, no matter how conservative your investment strategy or tailored plan is.
However, PensionBee is a safe pension provider from a legal standpoint. PensionBee has authorisation from the Financial Conduct Authority to provide pension services in the UK.
In addition to being regulated by the Financial Conduct Authority, PensionBee enjoys relationships with the following well-established and stable banks:
State Street Global Advisors
In addition to regulatory oversight and management, PensionBee is keenly aware of pension scams. It actively works to protect customers from those scams by examining transactions from unregulated providers very closely and flagging those that could be problematic.
How Do I Close my Account at PensionBee?
To close your account, you need to transfer your pension out of PensionBee. In most case, you’ll start a new account with a new provider and then have your new provider request the transfer on their end.
Otherwise, they will need to complete the process by email.
The transfer process can take a few weeks. PensionBee aims to transfer personal pension plans within 14 days of receiving the request.
However, it may take longer if you aren’t using a service regulated by the Financial Conduct Authority.
How to Withdraw Money from PensionBee?
Because you have a pension product, you can’t withdraw money until you reach 55.
One of the great things about PensionBee is that it offers a relatively flexible drawdown position. The service also guides you through withdrawals to make sure you don’t make mistakes, like exceeding your Lifetime Allowance.
To withdraw your money from PensionBee to use (not to transfer to another pension provider), you need to choose a drawdown plan.
Once you choose your drawdown option, you can then receive your cash in 7-10 working days. Everything needed to withdraw happens digitally, and PensionBee pays your emergency tax to HMRC for you.
PensionBee does offer annuities via Legal & General as well as traditional drawdown options.
Is PensionBee any Good?
Every investment comes with risk, but PensionBee itself is a strong company. Its product is thoughtful and well structured and it solves many of the pain points associated with other companies.
PensionBee is also very well reviewed. It has a 4.6 out of 5 on Trustpilot, which is an impressive score. People tend to go to Trustpilot to complain, so maintaining a high score is tough, particularly for an investment platform in this climate.
How to Contact PensionBee
You can get in touch with PensionBee by phone, email, post, or live chat.
The pension provider’s contact details are as follows:
City Place House
55 Basinghall Street
General enquiries: email@example.com
Phone: 020 3457 8444
If you want to talk to someone online, you can find their live chat function on the contact page.
Peter Field is a financial analyst and has written for InvestingReviews.co.uk covering topics from pensions, savings, investments and ISAs. His knowledge of the Investment market has proven invaluable, making his unbiased views and opinions open and honest for everyone. In 2021 Peter retired and is working towards enjoying more of the outdoors with his beloved labrador Millie.