The Lemon Fool

I have recently checked the charging structure details of my Zurich pension that I have held for the past 26 years

I have been told by Zurich that the following monthly charges apply to my pension:

Zurich Charge 1.2% monthly
Fund Management Charge 0.19%

For a total of 1.39% per month

This works out to 16.7% annually

This seems a bit high

I read here that funds are not allowed to charge more than 0.75% per month which is 9% annually

www dot moneyhelper dot org dot uk/en/pensions-and-retirement/pensions-basics/pension-scheme-charges

(sorry I cannot post links)

Are my fund managers allowed to charge 1.39% per month?

The funds were originally Eagle Star but changed names and owners a couple of times over the years to currently be Zurich managed funds

Thanks

I suspect its 1.39% per annum, paid monthly. A statement should have the charges in £ & pence.

That sounds ludicrously high. At that rate I'd be surprised if you had any pension at all. I had a quick scan at some typical fund charges

https://www.zurich.co.uk/-/media/docume ... 710813.pdf

There was nothing in that range....the numbers you are suggesting might be annual charges.

Why not list out the name of the fund(s) in question.

^Thanks

Seems like it was crossed wires on the phone. The girl I was talking to kept saying the 1.2% (Zurich) and the 0.19% (fund) were both monthly charges

I think she meant it was an annual rate which was charged monthly

Are there currently limits on how much an institution can charge for managing a pension?

Zurich lists most of their management fees as 0.65-0.85%

So the 1.2% management fee they are applying to this old Eagle Star pension is high. Eagle Star were acquired by Zurich in 1999 which is why it is now a Zurich pension

If there are rules then do they apply to legacy products?

Like when the rule came into force were legacy pensions required to reduce their fees or did the rule only apply to new products?

The fund is UK Equity2 EP

I cannot post links but you can google it on trustnet

I was curious to see what the fund was. It is primarily invested in UK companies (92%).

"A broad spread of UK equities are held, ranging from relatively secure, blue chip and high yielding stocks to more adventurous small companies."

https://markets.ft.com/data/funds/tears ... 975349:GBP

It's roughly a 60:40 blend of two 'income' funds.

CT UK Fund Institutional X Income GBP 59.6%..GB00BWTW3K16:GBP

Ongoing charge 0.83% for this 60% of the fund.




CT UK Equity Income Fund Institutional X Income GBP 40.4%..GB00BNG64889:GBP
Ongoing charge 0.82% for this 40% of the fund.



Maybe you could phone up again and ask what your charges are and perhaps you'll 'get lucky' and get someone who will be able to explain the charges. It would be worth a phone call.