Effective from 1 June, the funds’ annual management charge and variable extra expenses will be merged into a single ‘fund management fee’ (FMF).
LGIM expanded to say that the new price structure will give customers advance knowledge of the charges levied by the funds, with the FMF set at the same level as the fund OCFs.
The firm added that aside from the FMF there will also be additional entry and exit charges, which vary between funds, as well as transaction fees.
“It‘s really important that our customers understand the charges that they’re paying when investing,” said LGIM head of retail distribution, Honor Solomon.
“At the moment, there are a number of charges disclosed separately and it can be pretty confusing. The FMF will provide a clear and consistent measure of overall fund charges that we believe will be simpler for our investors to understand. Rather than getting distracted by the complexity of fund charges, investor focus can instead be on making the right investment decisions.”