With Profits expenses

Skitourer

Hello,
I'm hoping some kind soul can shed some light in the dark. I have units in "Friends Life FP with-profits" fund. I'm trying to understand how much it's costing me. On their factsheet it gives past performance, and says the percentages quoted are "before any deduction for charges but net of investment expenses". But I can't find any clear reference in the factsheet to how much those charges actually are. How can I get a clear understanding of how much this fund is actually costing me?

Sincere thanks in advance.

dunstonh

I have units in "Friends Life FP with-profits" fund.

Is that the unitised with profits or the conventional with profits?

On their factsheet it gives past performance, and says the percentages quoted are "before any deduction for charges but net of investment expenses".

That means the charges are at contract level and not fund level. Not uncommon on insurance company plans as the charges could be set differently with every plan.

How can I get a clear understanding of how much this fund is actually costing me?

Look at the product charge as its likely to be there. The product charge will include the fund charge.

Skitourer

Hi Dunstonh,
many thanks for you swift reply. It's the conventional with profits.
So should the product charge be detailed in their factsheet? I can only see this:
"In respect of pre demutualisation business all administration expenses and commission incurred by Friends Life Limited is charged to the Non Profit Fund, with any charges levied against the FP with Profits fund being governed by the 2013 scheme. Future increases in charges continue to be in line with the rate of the Retail Price Index plus one percent."

Does that mean that ongoing charges are governed by the 2013 scheme, and that these are RPI + 1%??

Skitourer

Correction! Unitised.

dunstonh

It's the conventional with profits.

You wont find those on factsheets. These types of plans pre-date that sort of consumer level data.

So should the product charge be detailed in their factsheet? I can only see this:

No. Product charges are on the product, not the fund. You would need to ask what the product charges are.

It is usually not a good idea to try and work out the unbundled costs of a legacy product from yesterday but just focus on the bottom line. Then compare against the bottom line of a modern day unbundled product.

edit:

Correction! Unitised.

In which case it will likely be at product level. You need to ask them the charges of the product

Skitourer

Excellent advice. So just to be sure I'm following you, you're saying I could just do the interest calculation from my annual statement (net of any money I've paid in) and decide whether or not I'm satisfied with that level of return...?

dunstonh

Effectively yes.