Around 300,000 savers could receive around an 8% boost to their savings as company pension schemes prepare to cut charges.
Around 170 pension schemes that have signed up to kitemarking scheme the Pension Quality Mark (PQM) will have to cap total pension fund charges at 0.75% a year, according to The Telegraph. That is down from the 1% cap previously set by the PQM, an initiative of the National Association of Pension Funds. The change will take effect on 1 April.
PQM chairman Chris Hitchen said: ‘Up to 11 million people will be auto-enrolled into a workplace pension, so we have to change defined contribution pensions for the better. We want to push fees down so that savers can enjoy better pensions. Charges can have a huge impact on people's savings, and our tougher new standard is a big step in the right direction.’