Consumer group Which? wants the Financial Conduct Authority (FCA) to take action to simplify drawdown charges to make pensions freedom and choice retirement income options easier to understand.
It said both the regulator and the government should help people benefit from pensions freedom and choice as it revealed wide variations in provider charges.
It said it had analysed products from 18 companies to find out how much it costs to take money in retirement.
Which? said someone with a pension pot of £50,000, taking 4% a year through income drawdown, could be more than £3,000 better off over ten years if they used the cheapest provider, Fidelity (£4,993), rather than the most expensive, The Share Centre (£8,100).
For larger pots of £250,000, with 6% a year withdrawals, a retiree could face charges anywhere between £16,325 (LV=), and £26,490 (Scottish Widows) over a decade - a difference of more than £10,000, Which? said.
The report said it can be hard for people to compare charges to find the cheapest provider as there are wide variations in how they charge, with some companies levying five separate types of fees.
Six out of 18 companies responding to the survey charged to set up a drawdown plan, seven charged an annual drawdown use fee, and eight charged an annual fee if the client had a self-invested personal pension.
Which? said although seven providers charge a simpler, single annual 'platform fee' there could be annual management charges on top of that, as well as additional fees for certain types of investments.
Taking ad-hoc amounts of money from pension pots, through uncrystallised fund pension lump sums (UFPLS), can also be a costly option, the research found.
Charles Stanley Direct charges £270 for the first withdrawal each year, James Hay charges £100, and Barclays Stockbrokers, Halifax Sharedealing and TD Direct all charge £90, Which? said.
This is compared to Fidelity and Hargreaves Lansdown, and some pension companies, which don't charge anything at all.
Which? said while the government is right to consider a cap on exit penalties it urged further action to make drawdown more accessible. It said the government should "go further to ensure everyone can access their money flexibly without facing excessive fees".
It said it wanted the government and FCA to work with the industry to simplify charges and to introduce a charge cap for default drawdown products sold by someone's existing provider.
Which? executive director Richard Lloyd said: "The old annuity market failed pensioners miserably and the government must ensure the same thing doesn't happen again with drawdown.
"With such big differences in cost, and confusing charges that make it difficult to compare, it's clear more needs to be done to help consumers make the most of the freedoms.
"We're campaigning for a cap on charges for drawdown products sold by someone's existing provider to ensure people get good value for money."
Hargreaves Lansdown head of pensions research Tom McPhail said: "The only sustainable answer is that we have a transparently competitive retirement market where informed investors shop around for the solutions which will suit them best.
"Drawdown isn't just about the price, it is also about putting investors in control of their money and giving them access to online tools and calculators to help them manage their money effectively."
He added: "The risk with a price-capped 'default drawdown' is that investors won't be sufficiently aware of the risks they face of investment losses or of drawing their money out too quickly. A 'default' drawdown risks investors sleepwalking into unexpected investment losses.
"We would like to see the barriers to pension freedoms removed so that investors who have shopped around can move their money quickly and cheaply, with having to pay unreasonable exit penalties."
Which?'s Better Pensions campaign is calling for the government, pension providers and regulators to protect people when they take money out of their pension by:
- Establishing a government-backed provider to ensure everyone can access a good value, low-cost product;
- Introducing a charge cap for default drawdown products; and
- Safeguarding savings in schemes that go bust.
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