Now Pensions launches AE cost comparison index showing 'devastating fees'

Charges could erode savings

Kim Kaveh
clock • 2 min read

Now Pensions has launched an auto-enrolment (AE) cost comparison index to illustrate the long-term implications of fees charged by pension providers.

The master trust said that while the recent increase in total AE minimum contributions in April - from 5% to 8% - this means long-term charges levied by providers could potentially erode savers' retirement pots. Now Pensions' index revealed workers earning £28,000 and paying a monthly minimum contribution could be hit with fees of up to £7,000 within two decades. It further showed that those making a one-off transfer of £28,000 in from another fund could face up to £16,000 of charges. Members of defined contribution (DC) schemes are usually charged an annual management charge (AMC) an...

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