Best Drawdown Pension Providers in the UK (2026): What a £100,000 Pot Really Costs

By Emily Harrington | Published 23 October 2026 | Last checked 23 October 2026

What is the best drawdown pension provider in the UK?

There is no single best provider, because the cheapest depends on your pot size. On our checks of seven providers on 23 October 2026, a £100,000 pot held in funds costs £71.88 a year at Interactive Investor, £150 at Vanguard, £250 at AJ Bell, £350 at Fidelity and Hargreaves Lansdown, £375 at Aviva, and £500 at PensionBee’s cheapest plan.

Pension drawdown, also called flexi-access drawdown, lets you keep your pension invested while taking money out when you need it. You can normally take up to 25% of your pot tax-free, and the rest is taxed as income when you withdraw it. Interactive Investor, AJ Bell, Hargreaves Lansdown, Fidelity, Vanguard and Aviva are do-it-yourself platforms where you choose the investments; PensionBee is expert-managed, which is why it costs more. If you go the DIY route and hold a global index fund, fund charges are typically under 0.25% a year on top of the platform charge.

How much does pension drawdown cost on a £100,000 pot?

Between £71.88 and £500 a year in platform charges alone, before fund charges and any dealing. That is the range across seven UK providers on a £100,000 pot held in funds, with no trades in year one, every figure checked on the provider’s own charges page on 23 October 2026.

Three notes on the table. First, the totals assume no buying or selling in year one; if you trade, add the dealing charges shown. Second, fund charges are extra at every provider. Third, Interactive Investor repriced on 1 February 2026 and Hargreaves Lansdown on 1 March 2026, which is why pages still quoting the old £12.99 a month and 0.45% figures are out of date. The Which? cost survey is a useful cross-check, though its Interactive Investor figure still uses the old pricing.

Flat fee or percentage fee: which is cheaper for your pot?

A flat fee stays the same whatever your pot is worth; a percentage fee grows as your pot grows. On a £100,000 pot, Interactive Investor’s Core plan costs £71.88 a year, an effective 0.072%, while Hargreaves Lansdown’s 0.35% costs £350. The difference is £278.12 in year one.

The maths, shown in full:

• Interactive Investor: £5.99 x 12 = £71.88 a year
• Hargreaves Lansdown: 0.35% x £100,000 = £350.00 a year
• Year-one gap: £350.00 – £71.88 = £278.12
• Over 10 years at the same pot size: £278.12 x 10 = £2,781.20
• Over 20 years: £278.12 x 20 = £5,562.40

Flat fees do not win at every size. The crossover is where the flat fee equals the percentage charge. Against a 0.35% provider, £71.88 a year breaks even at a pot of about £20,500 (£71.88 divided by 0.0035), so below that the percentage provider is cheaper. Against Vanguard’s 0.15%, the flat fee wins only above about £48,000. The honest rule: small pots favour low percentages, large pots favour flat fees. Run your own pot size through our pension drawdown calculator to see where you land.

What does this mean for your money?

It means the most expensive common mistake is staying with a percentage-fee provider as your pot grows, because the fee grows with it while a flat fee stands still. A £100,000 pot paying 0.35% hands over £350 a year; the same pot on a £71.88 flat fee keeps £278.12 more.

Cost of doing nothing: if your £100,000 drawdown pot sits with a 0.35% provider when a flat-fee plan would cost £71.88, inaction costs about £278 every year, £2,781 over 10 years and £5,562 over 20 years. That is real money taken from your retirement income, and it compounds against you because every pound paid in fees is a pound not growing.

Fees are only half the decision. The Which? survey of nearly 1,800 drawdown customers (August 2025) recommended AJ Bell, Fidelity, Interactive Investor, Transact, Royal London and Quilter, each scoring 70% or more for satisfaction. Cheap means little if the platform is hard to use when you need your money.

The drawdown fee trap: the charge that only appears when you retire

Here is the trap. Most providers charge you the same platform fee in drawdown as they did while you were saving, and many pages stop there. But some providers add a separate fee for the act of taking income, and it only appears when you retire, which is exactly when you are least likely to move.

On our checks: Fidelity charges no set up, one-off withdrawal or annual drawdown fees (stated on fidelity.co.uk). PensionBee charges no drawdown fees, but takes £150 if you withdraw your full pot within a year of your first transfer (stated on pensionbee.com, last edited 12 June 2026). Interactive Investor builds its pension admin fee into the monthly plan price, so there is no separate drawdown charge (stated on ii.co.uk).

AJ Bell is the one we could not pin down. Older schedules charged £25 per drawdown payment, and third-party reviews quote £100 plus VAT a year for regular income drawdown. We could not re-verify the current figure on AJ Bell’s own charges page on 23 October 2026, so treat it as unknown and check it directly with AJ Bell before you apply. The wider lesson stands: always ask any provider “what do you charge me for taking income, on top of the platform fee” and get the answer in writing before you transfer.

At what age can you start pension drawdown?

You can normally start taking money from a defined contribution pension at age 55. That minimum rises to 57 from 6 April 2028. Some older schemes protect a lower pension age for existing members, so check your own scheme’s rules before you transfer anything.

Both Interactive Investor and PensionBee confirm this on their own pages. If you are still building your pot and under 40, our Lifetime ISA guide covers the other tax-advantaged route for retirement saving.

Drawdown or annuity: which is better?

Drawdown keeps your pot invested and flexible, but the income is not guaranteed and you can run out of money. An annuity swaps some or all of your pot for a guaranteed income for life, but you give up the capital and the flexibility.

The numbers show the trade-off. Recent market checks put a level single-life annuity for a 65-year-old at around 7.6% to 7.9% a year, so £100,000 buys roughly £7,600 to £7,900 of guaranteed annual income. A commonly used sustainable drawdown rate is 3.5% to 4% a year, so the same £100,000 supports roughly £3,500 to £4,000 a year if the pot is to last. The annuity pays about double, but the capital is gone and there is nothing left to inherit unless you pay extra for guarantees. A common middle route: enough annuity to cover essential spending, with the rest in drawdown for flexibility. Our retirement planning guide walks through how the two fit together, and the tax side is covered in our UK tax code guide because your first pension payment is often taxed under an emergency code.

What does the FCA require drawdown providers to tell you?

The FCA requires providers to offer four ready-made Investment Pathways when you move into drawdown: one for money you will not touch for five years, one for money heading toward an annuity, one for long-term income, and one for money you plan to take within five years.

Providers must also send you wake-up packs before you can access your pension and signpost free guidance. That free guidance is Pension Wise, a government service from MoneyHelper for people aged 50 and over with defined contribution pensions. It is free, impartial, and a sensible first call before you move any money.

What should you check before transferring a pension for drawdown?

Check five things in this order: valuable guarantees, such as guaranteed annuity rates; exit fees on the old scheme (capped at 1% for the over-55s); the new provider’s drawdown fees plus its platform fee; whether you must sell to transfer or can move investments as they are; and the £10,000 annual allowance for new contributions once you take taxable income.

Transfers are normally handled by the new provider and take a few weeks, and many providers will cover your transfer costs up to £500 to win your business. Once you take taxable income, the Money Purchase Annual Allowance drops to £10,000 a year for 2026/27 (confirmed on Aviva’s drawdown pages). If your current provider does not offer drawdown at all, which is still true of some older SIPPs, transferring is the only way to get flexi-access without buying an annuity.

Pension drawdown FAQs

Can I take 25% of my pension tax-free?

Yes. You can normally take up to 25% of your pension pot as a tax-free lump sum, in one go or in stages. The maximum tax-free amount across all pensions is £268,275 (the lump sum allowance). Anything above 25% is taxed as income at your normal rate.

Our cash ISA versus stocks and shares ISA guide compares the pension tax-free amount with ISA allowances.

Do I pay the same fees in drawdown as when I was saving?

Usually, yes: the platform or custody charge continues at the same rate. What changes is that some providers add a separate drawdown administration fee for taking income, which is why the table above separates the two. Confirm both figures with the provider before transferring.

Can I change drawdown provider later?

Yes. You can transfer a pension that is already in drawdown to another provider, and the new provider does most of the paperwork. Check exit fees on the old scheme and drawdown fees on the new one first.

What happens to my drawdown pot when I die?

It normally passes to your beneficiaries, and the tax depends on your age when you die. If you die before 75, they can usually take it tax-free as drawdown income or a lump sum; from 75, it is taxed as their income. Complete a nomination of beneficiaries form with your provider so the trustees know who should receive it.

Is pension drawdown safe?

It is flexible, not safe in the guaranteed sense. Your pot stays invested, so its value can fall as well as rise, and you could get back less than you put in. Taking too much too early, or selling investments during a market fall to fund income, can permanently shrink your pot. That risk is the price of the flexibility.

Does taking drawdown affect my State Pension?

No. Your State Pension is separate and unaffected by drawdown. It simply adds to your taxable income in the years you receive both, which can push you into a higher Income Tax band.

Do this next, in this order

1. Get free guidance first. If you are 50 or over, book a free Pension Wise appointment through MoneyHelper (phone 0800 138 3944) before you move or touch any pension. It is impartial and it costs nothing.
2. Write down your pot size and your plan. Note each pension’s value, whether you want lump sums, a monthly income or a mix, and when you need the money to start.
3. Run the table maths on your own pot. Apply each provider’s charge to your pot size, not £100,000, and add dealing charges if you trade. Our pension drawdown calculator does the income side of the same calculation.
4. Shortlist two providers and read their charges pages yourself. Start with the providers’ own pages: Interactive Investor, Hargreaves Lansdown, Fidelity and PensionBee. Figures change, and the page you read today beats any guide, including this one.
5. Check guarantees and exit fees before transferring. Ask your current provider about guaranteed annuity rates, protected pension age and exit fees, and get the new provider’s drawdown fees in writing. Only then start the transfer.

Risk warning: the value of investments can fall as well as rise, and you could get back less than you put in. Tax treatment depends on your individual circumstances and may change in future. This guide is information only and is not personal financial advice. If you are unsure, speak to an authorised financial adviser or use the free Pension Wise guidance service.