Pension savers could 'lose thousands' due to lack of transparency over charges

19 February 2024 , 14:25

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New search has revealed many people don't really know how much it costs to switch funds to a new provider. (Image: PA Archive/PA Images)

Pension savers might lose funds from their retirement pots due to different charges afer transfering monies, warn experts.

New search has revealed many people don't really know how much the charges vary between different pension provider. Of those questioned 72% admitted they didn't know what charges were made.

As some pension pots are worth hundreds of thousands of pounds even a tiny percentage difference can mean the change in charges could run into thousands of pounds. This report was carried out by People's Pension, who said the industry should be more clear about what are the differences in charges and fees.

Mr Patrick Heath-Lay, chief executive officer at People’s Partnership, said: "While there are many factors that can make a pension attractive, the two fundamental aspects are investment returns and charges. If people can't make an informed decision about the value they are being offered by different providers, they risk losing thousands of pounds from their retirement pots. This lack of transparency is an enormous issue that pensions providers have to address."

A survey by People's Partnership, conducted between November and December 2023, found that half of the 1,000 people who had consolidated their defined contribution (DC) pensions without a financial adviser in the past two years said it was easy to find information on fees and charges from both their old and new pension providers.

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