Pension pots set for change

THE PROJECTED rates of return on personal pension and life insurance products need to be reduced, according to a study for the Financial Services Authority.

Projection rates, which show prospective returns on investments, should be put at a more “realistic” figure to reflect the economic outlook, a report by PricewaterhouseCoopers said.

Peter Smith, head of investments policy at the FSA, said: “It is crucial that projection rates are set at a realistic level so that investors are not misled. Today’s independent research indicates our maximum projection rates should be reduced.”