New era of transparency

Occupational defined contribution pension schemes are now required to publish on a public website information about their scheme charges and investment costs.

We are delighted to make this information on our new-look website – simply click to view the full Chair’s DC Statement, which includes this information, or you can get an overview of the highlights here.

Typically, DC members face two broad types of cost from their pension schemes: annual management charges (which can include marketing, communication, administration, legal and consultancy fees, and regular payments to investment managers) and transaction costs.

Annual management charges are normally expressed as an annual percentage of funds under management. So, for example, a member invested in our default Long Term Growth Fund typically pays a charge of 0.142% on the value of their pension pot each year until they retire. In a default fund, the charge is capped at 0.75%.

Transaction costs are the trading fees incurred by managers of the pension scheme’s investments, from buying and selling shares and bonds, for example. These are usually lower than pension scheme charges, but excluded from the charge cap.

The costs & charges information that we must now publish as part of the Chair’s DC Statement shows the impact of these charges on the value of a typical member’s pension pot at retirement, so that you can better compare the value for money you are receiving from the DC Plan.

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