Auto Enrolment Default Generic Pre-Sales Illustration
Illustrative projections of how pension savings in Penfold’s auto-enrolment default investment plan could grow over time under different contribution, inflation, investment growth, and charge assumptions, helping members understand potential retirement outcomes.
Last updated: 18 June 2025
1. Introduction
The Financial Conduct Authority is a financial services regulator. It requires Penfold to give you this important information to help you to decide whether the Penfold Pension is right for you. You should read this document carefully in line with the accompanying Key Features Document so that you understand what you are buying, and then keep it safe for future reference.
This generic illustration gives you an indication of what income may be available to you at retirement from the Penfold Pension and how much you may have to pay in charges.
We will also provide you with annual statements to help you keep track of your pension benefits.
2. Assumptions
In calculating the projected pension benefits, and potential income at retirement we have assumed:
Inflation Rate Assumption
An inflation rate of 0% for Lower Growth; 2.00% for Intermediate Growth and 4% for Higher Growth.
Important information about this assumption and calculation: The illustrations below have been adjusted to take into account inflation. This is to give you an idea of their value in today’s prices. Think about how much £500 could buy 10 years ago and then think about what it can buy you today.
Investment Growth Assumption
In the ‘Default Plan’ your investments move between 3 different risk levels of our Penfold Plan. The level depends on your number of years until retirement. Given this we have assumed different growth rates at each stage for 3 different outcomes:
These values include inflation.
Important information about this assumption and calculation: These examples are only an illustrative guide and the returns are not guaranteed and are not minimum or maximum amounts. The value of your pension will depend on how your investment grows, the performance of the funds, on the tax treatment of the investment and rates of inflation.
The value of your pension can go down as well as up and is not guaranteed. You could get back less than you have paid in.
Charges Assumption
0.75% per year except where you have selected the Sharia plan in which case the charge is 0.88% per year.
For customers invested in the Default Plan, Penfold will deduct 0.73% in Annual Fees from your Plan, with a small amount (0.02%) being incurred within the fund as administrative expenses, for a total 0.75% in Annual Fees.
For customers invested in our other Plans the Annual Fee is made up of two parts:
- an Administration Fee of 0.58% on first £100,000 which is reduced to 0.23% on any amounts over £100,000 which pays for Penfold’s service (and our Partners)
- an Annual Management Charge (AMC) from the money manager of 0.17% for all plans except the Sharia plan which is 0.30%.
But the overall fee you pay, and its daily calculation process, is the same as for our Default Plan.
Retirement Age & Retirement Income Assumption
We have assumed that:
- you retire at the age of 68
- you take 25% tax free cash lump sum
- you buy a guaranteed pension income (lifetime annuity) with the remaining balance of your pension fund for yourself only. This will be paid monthly in advance for at least 5 years and for the rest of your life thereafter
Important information about this assumption and calculation: We have assumed that you retire at the age of 68, however you can start to take your pension from the age of 55. If you were to take benefits at a different age or if you were to choose a different type of annuity, for example one that continued to pay out to your spouse or civil partner after your death, then the income would be different.
Annuity rates change over time and this could impact the amount of income you receive in retirement if you decide to buy an annuity to provide retirement income.
Your retirement income will depend on how your investment grows and on interest and annuity rates at the time you retire.
Tax Relief Assumption
Tax relief at basic rate is applicable to personal contributions to the group personal pension.
Important information about this assumption and calculation: In the illustrations below we assumed that any money you personally contribute will be due 25% tax relief from HMRC. If you pay tax at a higher rate, you may be able to reclaim additional relief from HMRC.
Annual Contributions Assumption
We have assumed annual contributions based on qualifying earnings of a salary of £27,500, which we approximate to be £1,700 per year in the first year and increasing with inflation.
We have assumed contributions stop at 65 but continued to project forward investment returns.
Important information about this assumption and calculation: If your salary differs or increases at a different rate it will affect these values. Certain employers may also choose to contribute based on your ‘total earnings’ which would affect these values.
