Introduction
This guide provides a comprehensive overview of the fees we and/or our Partners may charge and any mechanics pertaining to such fees. Please also refer to the Raindrop Terms & Conditions and any other documentation we present you with. The Raindrop Terms & Conditions define any terms not defined here.
You will be due to pay Charges when they become due to be paid under your Raindrop Account. We will only charge you and you will only be due to pay each of our fees:
- From receipt of the first payment into your Raindrop Account or a Raindrop Arrangement with a Partner (the Administration Fee)
- On buying and holding a Permitted Investment that is available through the Raindrop Account (the Fund Fee)
- If you request and receive additional Raindrop Services that are not Inclusive Services (the Annual Maintenance Fee)
- Where payments are made out of the Raindrop Account or a Raindrop Arrangement with a Partner (the Drawing Pension Benefits Fees)
- Where we have notified you of any additional fees that may become due (the Incidental Fees and Other charges that may apply)
The Charges Guide sets out the current fees and charges associated with the Raindrop Pension Account, and other Raindrop Arrangements and Raindrop Accounts you may have. These may change from time to time. Please ensure you check the fees which apply before you seek to make a withdrawal.
Administration Fee & Fund Fees
Unless explicitly stated otherwise, Raindrop will cover any fees it incurs on your behalf in its interactions with any Partner from the charges you pay to Raindrop.
The total charge to you for the Raindrop Pension Account depends on both the value of your pension account and which investment fund you have selected, and is made up of an Administration Fee and a Fund Fee.
For example, your total charge would be 0.75% per annum on assets up to and including £100,000 if you are fully invested in a BlackRock® LifePath® fund.
In the Raindrop Pension Account:
Administrative Fee
Total Pension Account Value
Fee
On the first £100,000
0.54%
Anything over £100,000
0.35%
The fee is billed monthly but calculated by applying the daily equivalent of the annual percentage rates shown to the value of your account each day.
The Administration Fee is 0.54% per annum (used to cover our services and to pay for the services of the Partners) on the value of assets, including cash, held in your Raindrop Pension Account, if your asset value is up to and including £100,000. For any amount above £100,000, the Administration Fee is only 0.35% per annum.
The Administration Fee will be deducted from your pension account fund and if you have more than one fund it will be taken proportionately from each fund.
The Administration Fee covers all costs typically associated with pensions, including the pension administration cost, custody fees, payment processing fees, et cetera and our services to you.
Fund Fees
Fund
Fee % of fund value
BlackRock® LifePath®
0.21%
Legal & General Future World ESG Developed Index
0.25%
The Fund Fee (Annual Management Charge or AMC) is charged by the asset manager and depends on the underlying investment option, or fund, your assets are invested in. The asset manager will deduct their fee directly from the funds they hold. The following Fund Fees apply by investment option:
· BlackRock® LifePath® funds: 0.21% per annum
· Legal & General Future World ESG Developed Index: 0.25% per annum
For full details of the funds you should refer to each fund’s Key Information Document.
Should other funds be made available in the future, they may have different Fund Fees.
Illustrative costs to you over a 1-year period under a Raindrop Pension if fully invested in a BlackRock® LifePath® fund:
£5,000 in assets: £27.00 Administration Fee + £10.50 Fund Fee (£37.50 total)
£20,000 in assets: £108.00 Administration Fee + £42.00 Fund Fee (£150.00 total)
£200,000 in assets: £890.00 Administration Fee (£540 on the first £100,000 and £350 on the second £100,000) + £420.00 Fund Fee (£1,310 total)
Please also see your Key Features Illustration.
Aside from the fees described here, you should also be aware of transaction costs which are incurred by the asset manager in the natural course of business when they buy and sell assets within your investment plan. Their impact may be to reduce the performance of your investment.
Annual Maintenance Fee
The Annual Maintenance Fee currently does not apply to any of our products or services that we offer but may do so in the future.
Inclusive Services
There is no specific charge for:
Tools and educational materials around pensions and savings which are provided for informational purpose only and should not be construed as advice of any sort
Locating old pensions through our Combine service (combinepensions.myraindrop.co.uk), whereby you agree, at the time you request for us to locate your pensions, to transferring one or more of these into your Raindrop Pension Account, facilitated by Partners; Raindrop does not charge for transferring pensions into your Raindrop Pension Account but your current provider(s) may charge a fee for transferring out to Raindrop
Making use of the Raindrop website and any ancillary offering
Changing the investment fund
Making one-off or recurring voluntary contributions
There is no inactivity or maintenance fee or similar for dormant accounts/a Raindrop Pension to which you are no longer contributing (but there will be an Administration Fee and Fund Fee)
Drawing Pension Benefits & Transferring Out
Drawing pension benefits is free of charge. However, please be aware that we currently process benefit requests on a manual basis but we are working hard to fully automate this to bring it in to line with our simple and straightforward automated processes for helping you to accumulate pension savings and consolidate your old pension pots.
Transferring out to another pension provider is available at any time and is free of charge.
Incidental fees
For particularly complex or protracted matters an hourly rate of £100 may be charged. We will inform you of such matters before any charge is applied.
If you wish to receive communication by post you can contact us at hello@myraindrop.co.uk and we will endeavour to accommodate this at our discretion, though we may pass on costs in providing this service.
If an order is placed through alternative means (other than through our website or app), we may charge a reasonable fee to cover our expenses.
You may reach out to us for any other ad-hoc services you would like us to provide not covered here at hello@myraindrop.co.uk and we will endeavour to accommodate your request at our discretion, though we may pass on fees reasonably incurred by us to allow us to provide this service.
Miscellaneous
Unless otherwise stipulated, no interest will be paid to you.
On and from 2022, certain banking institutions that the custodian uses may pay interest on client monies held by them: if they do you will see interest received in your account. If you want to know details of the interest rate, please contact us.
If we or our Partners receive interest and retain a proportion of that interest (as a percentage or as an actual amount) we will disclose that to you.
The Administration Fee is exempt from VAT. However, VAT may be due on other services we or our Partners provide and you will be liable for such.
Other charges that may apply
In the unlikely event we were to cease trading, there may be additional charges to pay to our Partners in relation to the administration of your account. These are to cover the fact that we will no longer be able to act as an intermediary between you and our Partners. We do not anticipate that these charges will need to be applied but please note that our Partners reserve the right to charge such fees and set the level of these fees.
It is important that you make sure that there is enough cash in your Raindrop Account or the Raindrop Arrangements or a particular Partner’s Account at all times to cover any Charges that you incur.
If you do not have enough Cash in your Raindrop Account or Raindrop Arrangements to cover the Charges that you incur or income that you have asked us to pay you, we have the right to sell your Investments without giving you prior notice.
This Charges Guide forms part of the terms and conditions under which you are liable to pay the charges as detailed, and you authorise us to take, and the Partners to take, payment from any of the Raindrop Arrangements you hold through Raindrop, to extent permissible under current legislation.
