We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
How to work out charges?

foofi22
Posts: 2,207 Forumite


Hi
I am contributing to a company DC scheme provided by Zurich, and I'm not sure how to calculate total fund charges.
So taking the following fund as an example:
UK Smaller Companies ZP
http://factsheets.financialexpress.net/zuri/SPUSC1_ZL61_ZUR.pdf
The factsheet says a 'fund charge' of 0.16% (although on trustnet a figure of 0.25% is used for the 'Annual Charge')
Additionally my annual statement gives some figures. At the last statement this particular fund had a 'fund based charge' of 0.48%.
So does this mean the total annual charge is just 0.16% + 0.48% = 0.64%?
Thanks
I am contributing to a company DC scheme provided by Zurich, and I'm not sure how to calculate total fund charges.
So taking the following fund as an example:
UK Smaller Companies ZP
http://factsheets.financialexpress.net/zuri/SPUSC1_ZL61_ZUR.pdf
The factsheet says a 'fund charge' of 0.16% (although on trustnet a figure of 0.25% is used for the 'Annual Charge')
Additionally my annual statement gives some figures. At the last statement this particular fund had a 'fund based charge' of 0.48%.
So does this mean the total annual charge is just 0.16% + 0.48% = 0.64%?
Thanks
0
Comments
-
External Fund factsheets should be ignored as they typically show the maximum or default charge. This may not be the charge you are on.
There are usually different series for the same fund. Especially in the case of defined contribution occupational pensions which will often use the institutional version of the fund rather than the retail version.
I have just checked FE (effectively the paid for version of trustnet) and there are three versions of this fund in the retail market. The most expensive is the ZP version at 0.16%.
Zurich pensions often have their charges on the contract with lower charges (if any) on the fund.
Factsheets are not reliable and should not be used. IFAs use software to calculate charges as it is so often impossible to calculate manually on multi-charge plans (which zurich plans so often are). On mono charged plans it is easier. However, if you ask them directly, they will be able to give you the information.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Thanks, so basically contact Zurich who can provide accurate figures.
Besides the charge shown on factsheets, they are still useful for providing general details about the fund?
Also, with regard to IFA advice, what pot size would you regard as a minimum before approaching an IFA? (£30k? £50k, £100k?!)
Cheers0 -
-
doughnutmachine wrote: »an actively run fund that invests in small companies is likely to charge 2% plus a year......
The factsheet says 0.16% and Trustnet says 0.25% - so where have you plucked 2%+ from?0 -
The factsheet says 0.16% and Trustnet says 0.25% - so where have you plucked 2%+ from?
the factsheet also says that the fund size is £8.2m. What do you think the chances are that someone can employ fund managers/ a nice warm office/ admin staff/ pay stamp duty for £13,120 a year?
The fact sheet also says this....
"These are the charges that are deducted within
the unit price. Other charges which reduce the
number of units you hold may apply. For further
information please refer to your Terms and
Conditions."
0 -
an actively run fund that invests in small companies is likely to charge 2% plus a year......
Not really. A lot of internal pension funds from insurance companies are run on a budget (which is also why you dont often see insurance company equity funds going that well. Their forte tends to be fixed interest and property). Plus, the internal fund range is often run on the basis of cross subsidy. Insurance company balanced managed funds (as they used to be called) are multi-asset and usually monster funds. Zurich's has £11,134.9 Million in it. It will almost certainly have more money in that then the rest of them put together. Indeed, many will use elements of the smaller single sector funds as part of the main managed fundI am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
.....and don't forget all the hidden charges that they wont tell you about because yo willnot have posed he question correctly - for example performance fees - note the wording fee so when you ask about charges this wont register.
there will be many ways the financial bods will be able to avoid telling you the total costs you are paying - when TER - Total Expense Ratio isn't the total expense to you you can see you have nochance of finding out
"how can you tell when a politicion** is lying?"
when his lips move!
** substitute profession of your choice
cheers
fj0 -
.....and don't forget all the hidden charges that they wont tell you about because yo willnot have posed he question correctly - for example performance fees - note the wording fee so when you ask about charges this wont register.
What performance fees?there will be many ways the financial bods will be able to avoid telling you the total costs you are paying - when TER - Total Expense Ratio isn't the total expense to you you can see you have nochance of finding out
TER has gone.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Not really. A lot of internal pension funds from insurance companies are run on a budget (which is also why you dont often see insurance company equity funds going that well. Their forte tends to be fixed interest and property). Plus, the internal fund range is often run on the basis of cross subsidy. Insurance company balanced managed funds (as they used to be called) are multi-asset and usually monster funds. Zurich's has £11,134.9 Million in it. It will almost certainly have more money in that then the rest of them put together. Indeed, many will use elements of the smaller single sector funds as part of the main managed fund
the OP asked what the total charges for this fund are. all this talk about a maximum of 0.16% is misleading.
the truth is that no one really knows what the total charges are for fund management - because the fund management industry keeps these figures hidden.
perhaps you could explain how a fund manager can run a fund for £13,000 a year? it's not even enough money to employ a school leaver on minimum wage.....0 -
doughnutmachine wrote: »the OP asked what the total charges for this fund are. all this talk about a maximum of 0.16% is misleading.
the truth is that no one really knows what the total charges are for fund management - because the fund management industry keeps these figures hidden.
perhaps you could explain how a fund manager can run a fund for £13,000 a year? it's not even enough money to employ a school leaver on minimum wage.....
If no one knows the true cost of a fund, what else should we tell the OP than the cost shown (which in reality will be less, more than likely).
You can always peel it back to expose more costs (and you're right, we will never know what they are) but the same could be said about directly purchasing a share - the PLC will always remove the costs of running the business before announcing profits/dividends.
The point is if a unit is valued at £1.00 and the retail cost is 1%, you'll be left with 99p - there's nothing more you can add to that without guessing.0
This discussion has been closed.
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 348.2K Banking & Borrowing
- 252.1K Reduce Debt & Boost Income
- 452.4K Spending & Discounts
- 240.8K Work, Benefits & Business
- 617K Mortgages, Homes & Bills
- 175.6K Life & Family
- 254K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 15.1K Coronavirus Support Boards