Pension fees and charges

There are generally two types of charges:

Initial charges to set up your plan, such as the allocation rate, entry charges and bid/offer spread
Ongoing charges to manage your pension plan. These can include a monthly policy fee and a yearly fund management fee.

These charges can have a significant effect on the value of your pension at retirement, especially the ongoing yearly charges, which are calculated as a percentage of the value of your fund. As your pension fund grows, the charges also increase.

There can be a big difference in the charges for different pension plans. Remember that pensions with higher charges may or may not perform better than similar pensions with lower charges.