Question 1

How much does NEST charge in fees?

Accepted Answer

NEST has a two-part fee structure: a 0.3% Annual Management Charge (AMC) on the pot value, plus a 1.8% contribution charge on every contribution. The 1.8% is deducted before your money enters the pension, meaning only £98.20 of every £100 you contribute actually ends up in your pot. The 0.3% AMC is competitive with low-cost SIPPs, but the contribution charge is unusual — most other UK providers don't charge on contributions at all.

Question 2

Is NEST a good pension provider?

Accepted Answer

NEST is the government-backed default for UK auto-enrolment and is the largest workplace pension scheme by membership. The investment performance of its default fund has been broadly competitive with other workplace pensions. The main criticism is the 1.8% contribution charge, which is unusual and adds up over decades. For accumulating savers, low-cost SIPPs from Vanguard, AJ Bell, or Interactive Investor typically work out cheaper if you can transfer out.

Question 3

Can I transfer my pension out of NEST?

Accepted Answer

Yes — you can transfer your accumulated NEST pot to another provider at any time. NEST does not charge an exit fee. The transfer typically takes 4-6 weeks. You should check whether your current employer is still contributing into NEST — if so, the new contributions will continue going to NEST while you accumulate a separate pot at your chosen provider. You can transfer the NEST balance again later when you change jobs.

Question 4

Why does NEST charge 1.8% on contributions?

Accepted Answer

The 1.8% contribution charge was introduced when NEST was set up in 2012 to repay a £620 million government loan that funded its launch. NEST has stated it intends to remove the contribution charge once the loan is fully repaid, but as of 2025/26 the charge remains in place. NEST argues the combined charge structure (0.3% AMC + 1.8% contribution) works out broadly equivalent to a single 0.5% AMC over the average member's lifetime.

How much do NEST's fees really cost you?