Costs and charges FAQs

The Costs and Charges pages show the charges and other costs for the Workplace Pensions Schemes managed by Fidelity. There is a separate page for each scheme which shows the charges and transaction costs of each default strategy and fund available within the scheme and also projections to show the possible impact of the charges on your investments over time. Some  schemes are governed by Trustees and others are overseen by an Independent Governance Committee (IGC) who both have a duty to consider value for money for members and to provide information regarding this.  The Government and Regulators require Trustees and IGC's to publish the cost and charges information and make it available on a public website. Alongside the charges information there may also be scheme documents with important information about costs and charges and how the money in your scheme is invested.

These are not new or additional charges. They have always been there, within the unit price of your funds, but you can now see them, compare them against similar funds and understand their impact on your investment return.

You can view the Total Cost figure made up of the Transaction Costs plus the Total Expense Ratio (TER which includes annual management charges and other expenses) for any of the funds available within your pension scheme, which you may be familiar with from the fund factsheets.

You can also view an illustration which takes these costs and projects them to show you the impact of these charges on your eventual retirement pot, i.e. what you might receive if there were no fund charges compared to what you might receive because of them. This is available by fund or by Lifestyle Strategy (if you’re invested in one) and is expressed in monetary terms rather than a percentage figure.

These are not specific to individual members and are based on an average contribution for your scheme, and an average retirement pot size - again specific to your own scheme. This should give you an indication of the impact of the charges.

Please note this is not an illustration of what you might receive at retirement. Please see your annual account statement for a personal Retirement Illustration.

There are no charges for putting money in your pension plan, so if you contribute £100, the whole £100 is invested in your plan.​

However, there are certain charges that cover the management and administration of any funds you invest in, whether you hold them on a 'self-select' basis or as part of an investment strategy.​

These are:​

• Annual management charges​
• Other charges, such as auditing and registry fees​

These charges together make up a fund's Total Expense Ratio (TER). They are taken from the fund's assets and are reflected in the quoted daily price.

In addition to the TER, other transaction costs can be incurred on your funds, such as the costs involved in buying and selling the fund's underlying investments. Like the TER, they are not explicit charges and are built into the daily unit price of your funds.

In some cases, these transaction costs can be negative, implying the fund has gained from the transactions. Negative Transaction costs can be complex to understand and navigate but broadly refer to a situation where the costs associated with a financial transaction were lower than expected. This can happen when the purchase prices of assets are lower than anticipated or when fees are earned through stock lending. It is important to report these negative transaction costs, even though they may seem counterintuitive as a cost, as it helps advisers and customers compare providers and understand the overall cost of funds. However, negative transaction costs should not be directly interpreted as a discount on the fund.

You can find out what funds you're invested in and read fund factsheets to find out each fund's TER, as well as what it invests in, by logging in to PlanViewer. You can also use our costs and charges tool to see how all the above charges may impact your plan.

There could be several reasons for higher transaction costs:

• Management approach
• Investment style
• The asset class of the fund
• Market movement at the point of trading

The point of the legislation is that Governing Bodies will be able to compare costs that have been calculated on the same basis and use this to assess value for money for members. Cost and charges should not be viewed in isolation and should be taken into account alongside performance returns to get an overall picture of whether a fund offers value for money.

The illustration takes charges, which are already included within the price of the underlying fund, and projects them to show you what the impact of those charges would be on some example pension pots. It is showing you what would be achieved using the combined fund charges and comparing it against what would be achieved if there were no fund costs at all. For Lifestyle Strategies and target dated funds, the illustration takes account of the change in the asset allocation over time and fund costs and charges are weighted accordingly.

While the projections are not specific to individuals, the examples use an average contribution size for your own scheme and an average pension pot size specific to your own scheme. There are also assumptions made concerning any contribution increases, inflation, growth rates etc. The assumptions used can be found within the illustration notes or in the question ‘What assumptions have been used for the illustration?’.

For many schemes the information is available on the Fidelity website - please click here.  If your scheme is governed by Trustees they may have chosen to host this information on their own website. Your annual account statement will show you a website address (URL) where your specific scheme information is available and you can also access this page via PlanViewer.

The transaction costs that are shown relate to the funds that your life fund invests into. These costs are calculated by the underlying fund asset manager and we collect them and display them for you to see, and we use them to provide the illustrations. If you have any questions about the fund range, please look at your scheme literature, which is available on Planviewer, and which contains information about your plan and further contact details.

When searching for your scheme, you can use the scheme code, your employer name or the URL, all of which are provided on your member benefit statement here.

If you cannot find any data, it could be that:

• your scheme is not covered by the regulations or that the data has not yet been made available.
• if your Scheme is governed by Trustees, they may also have opted to host this information for members themselves on their own website, in which case you will not find it on the FIL Life site.
• if FIL Life are not the administrators of your pension scheme, for instance if we just manage the scheme assets, this information will be held elsewhere. This is likely to be on a website hosted by your Scheme Administrator or by your Scheme Trustees. Please contact your Scheme Trustees for details of where to access this information.

It is assumed that no withdrawal is taken from the pension pot while calculating projections. Impact on growth will be calculated using the following:

1. Average scheme contribution and no current pot
2. Average scheme contribution and average scheme pot
3. Average scheme pot and future contribution of zero

The illustrations will take future inflation into account.

Where future contributions are considered, they are assumed to increase in line with inflation.

In line with regulations, illustrations are rounded down to 3 significant figures. eg £19,442 would be rounded to £19,400, and £119,442 would be rounded to £119,000.

For lifestyle arrangements, a range of projection terms to retirement will be displayed to show the impact of the different fund mixes at different points in time. Average scheme contributions and pot sizes will be based on actual scheme data using the previous quarter’s data to calculate these numbers. These will be subject to minimum contribution levels of £100 and a minimum pot size of £1,000.

The data is first published online to be available for reporting within the Chair’s Report published annually by the Trustees or the Independent Governance Committee.

The data we use within the illustrations will be updated on a quarterly basis although in some cases, it might not have changed. Some fund managers will only update the transaction cost data annually or every six months. Total expense ratios (TER) may not have changed in that period. If they have, we will use the new data.