With the FSCS now protecting £120,000 per person for bank and building society accounts, I have been trying to find out what protection our pensions and stocks and shares Isas are afforded.
Both a pension and a stocks and shares Isa are likely to exceed the £120,000 FSCS protection limitsover time. However, I am not even sure it applies to them anyway, and it is more likely to be £85,000. If that is the case then the protection is surely entirely inadequate.
What amount of my pension or stocks and shares Isa is protected by the FSCS?
My wife and I have pensions and stocks and shares Isas, both managed by our independent financial adviser and invested in a ‘growth’ portfolio of funds. We are concerned that if the platform they are held on went under we would stand to lose life-changing amounts of money.
What is the recommended practice for mitigating this risk? Should we be keeping multiple different pots with different providers, as our pensions and Isas grow, to ensure we are adequately covered by the FSCS? J.D, via email
The FSCS £120,000 protection is specifically targeted towards cash deposits, and doesn’t apply to pension holdings
Harvey Dorset, of This is Money, replies: Your pension is the key to funding retirement, and because of this most of us will spend our entire working lives paying into a pot.
With auto-enrolment introduced in 2012, it is now more effort for salaried employees to not pay into a pension than it is to do so. This has substantially boosted pension saving. Meanwhile, many others use self-invested personal pensions (Sipps) that they manage themselves.
This means that millions of people will find that they have significant pension pots by the time they reach retirement age.
Above the age of 55, the average pension pot is worth well beyond the £120,000 covered under the FSCS scheme. According to the ONS for savers between the ages of 55 and 64, the average pot is £137,800.
But as highlighted below, the FSCS’s new higher £120,000 protection limit is specifically targeted towards cash deposits and doesn’t apply to pension holdings or other investment accounts.
This is Money spoke to two experts who explain below how exactly your pension is protected, and whether you need to take action to spread your risk.
Morgan says it is important to ensure that you only deal with FCA-regulated firms
Rob Morgan, chief analyst at Charles Stnaley, replies: The £120,000 FSCS limit applies to cash deposits at UK‑authorised banks, building societies and credit unions.
This includes current accounts, savings accounts and cash held temporarily at banks.
For investments, including stocks & shares Isas and most pensions, the protection limit remains at £85,000 per person, per authorised firm – and it’s important to check any financial business you use is regulated and therefore carries this protection.
The FSCS covers you to this extent if your platform or provider fails and cannot return your assets. Anything over that is not protected by the scheme.
However, the risk is very low owing to the significant UK regulation around the safeguarding of customer assets, which tends to mean it is not necessary to diversify providers.
Regulated UK platforms and providers must follow very high standards and strict rules to hold and protect people’s assets and money. Customer assets are held in segregated accounts, separate from the firm’s own funds, and they must be clearly recorded and regularly reconciled. In most cases, investments are held under nominee structures meaning you always retain beneficial ownership even if the provider fails.
Owing to this strict ring-fencing, problems with regulated platform providers are incredibly rare, and in the event of a business failure customers would typically get all their assets back swiftly and accurately.
However, it does underline the importance of only dealing with a business authorised and regulated by the FCA or PRA to ensure not only falls under the FSCS scheme but that it upholds all the standards of a regulated firm including the asset segregation rules.
> Guide to FSCS protection: How savings, investments and pensions are kept safe
Mir says platform failure rarely results in investors losing their holdings due to pension ring-fencing
Zohaib Mir, financial planner at EQ Investors, replies: Most pensions and Isas held on UK platforms are subject to strict FCA client asset rules.
This means your investments are legally segregated from the platform’s own assets and are held in custody (typically through nominee structures).
If a platform were to fail, your investments do not form part of the platform’s balance sheet and should remain legally yours.
In practice, the usual outcome is that the assets are transferred to another authorised provider rather than lost.
The FSCS does still provide a safety net, but only in specific circumstances. If an investment firm or platform failed and there was a shortfall in client assets (for example due to fraud or administrative failure), the FSCS may compensate up to £85,000 per person, per firm.
This is different from the £120,000 bank deposit limit. Importantly, FSCS does not cover normal market movements or investment losses.
Pensions can have additional layers of protection depending on their structure. Where a pension is provided by a life insurance company, FSCS protection can be 100 per cent with no upper limit if the insurer fails.
For Sipps, the £85,000 investment-firm limit typically applies to the operator. Defined benefit pensions are protected separately by the Pension Protection Fund.
Because of the way client assets are ring-fenced, platform failure rarely results in investors losing their holdings. For this reason, it is not usually necessary to split pensions or Isas purely for FSCS purposes. Diversifying across providers may be considered in very large portfolios, but this is generally a risk-management choice rather than a requirement for protection.
In summary, while FSCS limits for investments are lower than for cash, the legal segregation of assets means the risk of losing your pension or Isa due to platform failure is typically very low.
Compare the best DIY investing platforms
Investing online is simple, cheap and can be done from your computer, tablet or phone at a time and place that suits you.
When it comes to choosing a DIY investing platform, stocks & shares Isa, self invested personal pension, or a general investing account, the range of options might seem overwhelming.
> This is Money’s full guide to the best investing platforms
Every provider has a slightly different offering, charging more or less for trading or holding shares and giving access to a different range of stocks, funds and investment trusts.
When weighing up the right one for you, it’s important to to look at the service that it offers, along with administration charges and dealing fees, plus any other extra costs.
We highlight the main players in the table below but would advise doing your own research and considering the points in our full guide to the best investment accounts.
Platforms featured below are independently selected by This is Money’s specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence.
DIY INVESTING PLATFORMS Admin charge Charges notes Fund dealing Share, trust, ETF dealing Regular investing Dividend reinvestment AJ Bell* 0.25% Max £3.50 per month for shares, trusts, ETFs (£10 cap in Sipp). £1.50 £5 £1.50 £1.50 per deal More details Bestinvest 0.40% (0.2% for ready made portfolios) Account fee cut to 0.2% for ready made investments. Free £4.95 Free for funds Free for income funds More details Charles Stanley Direct* 0.30% Min platform fee of £60, max of £600. £100 back in free trades per year. £4 £10 Free for funds n/a More details Etoro* Free Stocks, investment trusts and ETFs. Limited Isa, no Sipp.Not available Free n/a n/a More details Fidelity* 0.35% on funds £7.50 per month up to £25,000 or 0.35% with regular savings plan. Free £7.50 Free funds £1.50 shares, trusts ETFs £1.50 More details Freetrade* Free (paid plans give better rates and features)Stocks, funds, investment trusts and ETFs.Free Free n/a n/a More details Hargreaves Lansdown* 0.45% – decreasing to 0.35% on 1 March Capped at £45 annually for shares, trusts, ETFs in Isa (increasing to £150). Free (increasing to £1.95) £11.95 (decreasing to £6.95) Free Free More details Interactive Investor* £5.99 per month under £100k (Core); £14.99 above (Plus) Free monthly trade on Plus plan. £3.99 (Core); £1.49 (Plus) £3.99 Free £0.99 More details InvestEngineFree Only ETFs. Managed service is 0.25% Not availableFree Free Free More details iWeb Free £5 £5 n/a 2%, max £5 More details Trading 212* Free Stocks, investment trusts and ETFs. Not available Free n/a Free More details Prosper* Free Refunded fees on 30 ETFs. No shares.Free Free Free Free More details Vanguard Only Vanguard’s own products0.15% Only Vanguard fundsFree Free only Vanguard ETFs Free n/a More details (Source: ThisisMoney.co.uk February 2026. Admin % charge may be levied monthly or quarterly