FSA to consult on reducing investment projection rates on products

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The Financial Services Authority (FSA) is to consult on reducing its projection rates after independent research supported the move.

A study by PricewaterhouseCoopers (PwC) looked at the rates which apply to retail investment products such as personal pensions and life products. The products for which the FSA currently produces projection rates includes endowment policies, maximum investment plans, stocks and shares ISAs and personal pension plans. The research supported a reduction in the current 7% intermediate projection rate and in the adjustment for tax-disadvantaged products. Peter Smith, head of investments policy at the FSA, said: "It is crucial that projection rates are set at a realistic level so that ...

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