Stakeholder Pensions
A stakeholder pension is a type of low-charge pension. You can buy a stakeholder pension from a commercial financial services company, such as a bank, insurance company or building society.
Stakeholder pensions must satisfy a number of minimum government standards to ensure that they offer value for money and flexibility. These standards include:
- management charges in each year must not amount to more than the charge cap as set down by law – this cap is an annual management charge of 1.5% for the first 10 years, which will reduce to 1% from then onwards if these members remain in the scheme
- all stakeholder pensions schemes must accept contributions of £20 or more, though some may accept lower payments
- stakeholder pension schemes must be run in the interest of their members, and will either have trustees or they will be run by a scheme manager
- the stakeholder pension contract must not have charges for members transferring into or out of the stakeholder pension scheme
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