Millions of pension investors are seeing their funds eaten away by charges that can leave them tens of thousands of pounds worse off in old age.

Alarming disparities between pension providers’ fees for keeping money in almost identical funds are hammering savers’ nest eggs.

Eight out of 10 investors believe fees are not being clearly disclosed to them, a poll by FT Money and financial firm Dianomi found.

The current City regulator, the Financial Services Authority, is alert to the problem and is working on an overhaul of how charges are applied and sold on investment funds. It will ban the commission that providers hand out to financial advisers for selling pension plans in 2013.

 

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By Julian Barkes