Do I have to pay to have a pension?
Most pension companies will charge an ‘annual management fee’, usually a percentage of the total amount in your pension pot. If your pension is invested well, this fee should be less than the amount your pension grows by, so even after paying your fees, you’d still have more in cash terms than you put in to your pension. Penfold charges an annual management fee of either 0.75% (for BlackRock’s funds), or 0.88% (for HSBC’s fund) for all of our customers.
Some pension companies will also charge you each time you contribute, or for setting up your pension or moving it to another provider. Many SIPP providers will also change a minimum fee each year, so if you don’t have enough saved in your pension you will lose much more than the annual management fee. Penfold won’t charge you for any of this.
What if I’ve got multiple pension pots?
This is a perfectly normal situation for someone who has been employed in the past. However, there are benefits to consolidating them, particularly from an administrative perspective. If they are all defined contribution pensions, with little or no exit fees, it might be a good idea to consolidate them into one place, so it is easy for you to keep track of them. You should consider other factors like the fees charged each year by the different pension providers.
If you put your money into a pension, usually it is then invested. As with any investment, it involves some risk; the value of your pension might go up as well as down, and you could get back less than you put in. However, risk can be a positive thing when it comes to investing, in particular if you have a long time left before reaching retirement age. Here’s a guide to understanding the risk involved in investing, and how Penfold is regulated.
The Penfold Pension is operated and administered by Gaudi Regulated Services Limited, who are authorised and regulated by the Financial Conduct Authority. If something happened to Penfold, your pension would still exist, and Gaudi would get in touch to explain how you manage it in the future if somehow there was no Penfold online portal. You could move your money to a different pension provider for no charge. Penfold is also FSCS protected, so if something happened to BlackRock or Lloyds, your money is guaranteed by the government up to £85,000.