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How to assess if you are getting value for money from your pension

Journalist: Marc Shoffman, Freelance

ended 09. January 2026

New FCA rules mean pension schemes must now publish data on their performance, costs, and service quality.

Value for money assessments will be shown in a colour rating, with dark green for strong performance, light green for good value, amber for improvement, and red for poor value.

https://www.fca.org.uk/news/press-releases/pension-value-be-put-under-spotlight

I am keen for comments on how to know if you are getting value for money from your pension.


Do the FCA change go far enough?

 

2 responses from the Newspage community

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Rob MansfieldVerified
Independent Financial Advisor at Rootes Wealth Management
It's really difficult to work out unless you have the time and skill set to be able to dig into the data. Pension providers need to make their statements and portals much more simple to get engagement from members. For most people, what they're interested in is, is it growing and if so how much by? That should be easy by looking at the fund factsheet but the choice of benchmark can flatter, it needs to be comparable. This traffic light system is interesting but it'll be lost on most people. For example, If your "average annualised standard deviation of returns" comes out as red, what action should you take? If you're in drawdown that could be a bad sign but if you're in the early stages of a career and looking for growth, it may be irrelevant.
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Kundan BhaduriVerified
Entrepreneur, Investor and Landlord at The Kushman Group
While 16 million workers will supposedly benefit from FCA's transparency drive, the reality remains that a poor scheme growing £10,000 to £10,400 over five years versus £15,100 in a strong performer means little when most people lack the financial literacy to interpret these figures.

There needs to be an investment in consumer finance education rather than more regulatory work. It is one thing for the pension providers to publish the data but a whole another matter when the consumers this is targeted towards don't have the fundamental education to understand the difference between debt and equity, active versus passive funds, or even basic things like what expense ratios mean.