SEI Master Trust costs and charges and net investment returns I

View or download this important information relating to the SEI Master Trust (PDFs):

Chair's statement |  Statement of investment principles  |  Implementation statement  |  TCFD Report

Default investment option: Lifestyle strategy – Charge I

The table below details the charges that apply to the Default Investment Option available to you through your pension scheme. The Trustee has taken account of total investment costs. Total investment costs means the Total Expense Ratio plus all fund transaction costs and additional fund charges (“AFCs”). The Total Expense Ratio (TER) combines the annual management charges and other expenses (such as auditing and registry fees). Other than transaction costs and AFCs, the TER covers all member-borne investment charges. Transaction costs are a necessary part of buying and selling each fund’s underlying investments, in order to achieve their investment objective, to raise or invest cash and to satisfy clients’ requirements. AFCs are the extra custody transaction costs incurred on some funds and will be higher on fund-of-funds products as they reflect the incurred ongoing charges of the underlying sub-funds. Further information on your investment options can be found within your plan literature and fund factsheets. Notes and assumptions used for these illustrations are shown at the end of this document.

Table 1 – Total investment costs

In the table below, the Trustee has shown the total investment costs borne by a member in the Default Investment Option based on the number of years until the Scheme’s Normal Retirement Age.

Table 2 – Cumulative illustration

The Trustee is required to include an illustration of the effect over time of costs and charges on the value of an average member's pension account. The average contribution and account value therefore relate directly to averages across the membership of this Section of the SEI Master Trust and show the projected values up to the point that the youngest member of this Section reaches Scheme Pension Age. The Projected Returns for the Default Investment Option are based on the Financial Reporting Council’s Actuarial Standard Technical Memorandum (AS TM1, version 5.0, effective 1 October 2023) guidance for the underlying investment options (listed in Table 3) and are not guaranteed. In providing these illustrations we have followed the Department for Work and Pensions (DWP’s) guidance about how to present this. The notes provided on the final page provide further details of the assumptions used in producing these illustrations.

Youngest member age: 21

Assumed withdrawal method: Flexi Access Drawdown

Table 3 – Individual fund option projected returns and investment costs

The table below shows the charges that apply to individual investment options available through your pension scheme and an estimate of their Projected Annual Returns. The Projected Returns for each of the funds listed below are based on the Financial Reporting Council’s Actuarial Standard Technical Memorandum (AS TM1, version 5.0, effective 1 October 2023) guidance and are not guaranteed. The notes provided on the final page provide full details of the assumptions used in producing the illustrations. Further information on your investment options can be found within your plan literature and fund factsheets.

Table 4 - Individual funds cumulative illustration

The Trustee is required to include an illustration of the effect over time of costs and charges on the value of a member's pension account. The average contribution and account values therefore relate directly to averages across the membership of this Section of the SEI Master Trust and show the projected values up to the point that the youngest member of this Section reaches Scheme Pension Age. The Projected Returns for each of the funds listed below are based on the Financial Reporting Council’s Actuarial Standard Technical Memorandum (AS TM1, version 5.0, effective 1 October 2023) guidance and are not guaranteed. In providing these illustrations we have followed the DWP's guidance about how to present this. The notes provided on the final page provide full details of the assumptions used in producing the illustrations.

Contributions: £998pm

Youngest member age: 21

Assumed withdrawal: Flexi Access Drawdown

Fund A- Highest number of members are invested (i.e. most popular)
Fund B - Lowest projected investment return
Fund C - Highest projected investment return
Fund D - Highest projected investment charge¹
Fund E - Lowest projected investment charge² 

¹ If not shown above, the Fund with the lowest investment charge is ‘Fund B’

² If not shown above, the Fund with the highest projected investment charge is ‘Fund C’

Cost and charges illustration notes and assumptions

1. Total investment costs means the Total Expense Ratio plus all fund transaction costs and additional fund charges (“AFCs”).
2. The Total Expense Ratio (TER) combines the annual management charges and other expenses (such as auditing and registry fees). Other than transaction costs and AFCs, the TER covers all member-borne investment charges.
3. Transaction costs are a necessary part of buying and selling a fund’s underlying investments, in order to achieve their investment objective, to raise or invest cash and to satisfy client requirements.
4. Transaction costs are provided by the investment managers who invest money for the Trustee. The requirement to provide this information has been in force since 3rd January 2018. Transaction costs are calculated using the so-called “Slippage methodology” which measures the market value prior to a trade, and the value of the assets once the trade has been made. Transaction costs have been based on an average of the previous 5 years’ transaction costs or, where data is available for fewer than 5 years, an average of transactions costs over the years for which data is available.
5. AFCs are the extra custody transaction costs incurred on some funds and will be higher on fund-of-funds products as they reflect the incurred ongoing charges of the underlying sub-funds.
6. The cumulative illustrations have been prepared in accordance with the Financial Reporting Council’s Actuarial Standard Technical Memorandum (AS TM1, version 5.0, effective 1 October 2023) guidance, which specifies the assumptions and methodology to be used in the calculation of Statutory Money Purchase Illustrations (SMPIs). This guidance dictates that accumulation rates must be determined in accordance with a fund’s volatility group, which is derived from its 5-year realised volatility, and has therefore removed any discretion that the Trustee may have been able to exercise in the past.
7. The SEI Master Trust invests directly into funds managed by SEI or alternative investment managers. For Lifestyle Strategies the time to retirement relates to the period to a member's target retirement age, or if not selected the Scheme’s normal retirement age.
8. Projected pension account values are shown in today's terms and do not need to be reduced further for the effect of future inflation.
9. For lifestyle strategies the effect of costs over different time periods to target retirement age are illustrated in Table 1.
10. The costs referred to in Tables 2 and 4 include administration costs (where payable by the member), the TER, transaction costs and AFCs. These are all the costs which are incurred by members.
11. The pension account size for active members with existing assets and deferred members is based on the averages within this section of the SEI Master Trust.
12. The average contribution for active members is broadly representative for active members in this Section of the SEI Master Trust and includes employee and employer contributions plus tax relief.
13. Contributions for active members are assumed to be paid up to age 65 and increase in line with assumed earnings inflation of 2.5% each year.
14. Cumulative Illustrations have been shown for the individual fund which has the greatest number of members invested in it (Fund A); the funds with the lowest and highest projected investment returns (Funds B & C) and the funds with the lowest and highest total investment charges (Funds D & E).
15. Fund values have been projected to at least the point at which the youngest member in the section (at the time of production) has reached Scheme Pension Age.
16. Members currently withdraw the value of their account from the Scheme at from Normal Retirement Age as Uncrystallised Funds Pension Lump Sums (UFPLS), flexi-access drawdown (FAD) and/or annuity purchase.
17. The projections assume that no withdrawals are made prior to Scheme Pension Age.
18. The projected growth rates for each fund have been calculated using the Financial Reporting Council’s Actuarial Standard Technical Memorandum (AS TM1, version 5.0, effective 1 October 2023) guidance shown in Table 3, less inflation which is assumed to be 2.5% per annum.
19. For Lifestyle Strategies the projections take into account the changing proportion invested in the different underlying funds over time and the growth rates may be a blend of those shown above where there is a blend of different asset classes. Any data used within the illustrations is the data held by the Trustee as at 31 December 2023.
20. These are not projections of your own pension account within the SEI Master Trust. To view these please refer to your annual benefit statement for an estimate of your pension; view your account online; or contact the SEI Administration Team for assistance T: 0800 011 3540 or E: Memberenquiries@seimastertrust.co.uk
21. All the figures illustrated here are only examples and are not guaranteed - they are not minimum or maximum amounts. You could get back more or less than this and you may also get back less than the amount that you have invested.

SEI Master Trust net investment return as at 31 December 2023

The information in this Appendix is intended to help you to understand how your investments are performing.

Net Investment Returns (NIRs) refers to the returns on funds minus all transaction costs and charges.

NIRs are different for different Sections. This is because fees charged vary between Sections due to their individual requirements and the operational complexity of each. The different charge categories (A, B, C etc.) described below each relate to a different Section of the Trust. The category/letter that relates to your membership is included within your annual benefit statement.

Default investment option: Lifestyle strategy – Charge I

The table below details the Net Investment Returns (NIR) of the Default Investment Option available to you through your pension scheme. Further information on your investment options can be found within your plan literature and fund factsheets. Notes and assumptions used for these illustrations are shown at the end of this document.

Table 1 – Net investment returns (1-5 year)

In the table below, the Trustee has shown the total net investment returns of the Default Investment Option based on different age members in the scheme. Data shown represents past performance. Past performance is not a reliable indicator of future results. For illustrative purposes only. 

Table 2 – Individual fund option net investment returns

The table below shows the net investment returns of the individual investment options available through your pension scheme. Further information on your investment options can be found within your plan literature and fund factsheets. Data shown represents past performance. Past performance is not a reliable indicator of future results. For illustrative purposes only.

Net investment return illustration notes and assumptions

1. Net investment returns have been documented dating back over the past scheme year and then the past three and five years.
2. Net investment returns have been calculated as a percentage of growth that would have been experienced for an investment made at the beginning of the past scheme year (1 January 2023) to the scheme year end (31 December 2023), and the cumulative growth over three years on an investment made on 1 January 2020 up to 31 December 2023; and the cumulative growth over 5 years on an investment made on 1 January 2018 up to 31 December 2023. 
3. Returns are shown as an annual geometric average being the annual net return which, when compounded over time, delivered the return shown.
4. The Trustee has taken account of total investment costs. Total investment costs means the Total Expense Ratio plus all fund transaction costs and additional fund charges (“AFCs”).
5. The Total Expense Ratio (TER) combines the annual management charges and other expenses (such as auditing and registry fees). Other than transaction costs and AFCs, the TER covers all member-borne investment charges.
6. Transaction costs are a necessary part of buying and selling a fund’s underlying investments, in order to achieve their investment objective, to raise or invest cash and to satisfy client requirements.
7. Transaction costs are provided by the investment managers who invest money for the Trustee. Transaction costs are calculated using the so-called “Slippage methodology” which measures the market value prior to a trade, and the value of the assets once the trade has been made. Transaction costs have been based on an average of the previous 5 years’ transaction costs or, where data is available for fewer than 5 years, an average of transactions costs over the years for which data is available.
8. AFCs are the extra custody transaction costs incurred on some funds and will be higher on fund-of-funds products as they reflect the incurred ongoing charges of the underlying sub-funds.
9. The SEI Master Trust invests directly into funds managed by SEI or alternative investment managers.
10. For Lifestyle Strategies the age of the member is the age of the member at the start of the reporting period. For Lifestyle Strategies illustrated in Table 1, the investment returns take into account the changing proportion invested in the different underlying funds over time and the growth rates may be a blend of those shown above where there is a blend of different asset classes.
11. For more information relating to your own pension account within the SEI Master Trust view your account online and/or contact the SEI Administration Team for assistance T: 0800 0113540 or E: Memberenquiries@seimastertrust.co.uk
12. Data is correct as at 31 December 2023.