Pension exit fees to be slashed

The government is proposing to limit the exit charges levied by some workplace pension schemes on savers who withdraw their money early. David Prosser explains.

Thousands of the savers who took advantage of the new rules allowing them more flexible access to their pensions will have paid high fees for the privilege. Now, 18 months after the pension freedom rules were introduced, the government is proposing to limit the exit charges levied by some workplace pension schemes on savers who withdraw their money early, to a maximum of 1%.

The cap is intended to help savers whose workplace schemes charge a fee when someone over the age of 55 accesses their savings before the scheme's official retirement age either to transfer the money to another provider or to begin withdrawals.

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David Prosser
Business Columnist

David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.