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Vanguard cuts fees on Life Strategy funds as assets hit £5bn


Vanguard has cut the charges on its Life Strategy funds from 0.24 per cent to 0.22 per cent as the range hits £5bn assets under management.

The cuts come into force on 18 January, and will be the third time the asset management giant has dropped the charges on the five-strong index fund range since it was launched in June 2011.

Initially, charges varied from 0.33 per cent for the highest equity-exposed fund in the range to 0.29 per cent for the lowest equity-exposed fund. In 2014, fees across the whole range were cut to 0.29 per cent in January and then to 0.24 per cent in August.

Speaking to Money Marketing, Vanguard head of UK retail sales Neil Cowell says: “As for the previous reduction we are simply amassing scale into the Life Strategy funds. We got extremely positive flows in the past 12 months and so we were able to pass on the cost reduction to the economy [of the range]…that is a very consistent thing with Vanguard.”

Cowell hints at further price reductions if the range’s scale “continues to grow” in the future.

The range had inflows of more than £2.3bn over the last year.

The £2bn Vanguard 60% Equity fund and the £1.3bn 40% Equity fund are the most popular of the range ranking 17th and 20th respectively within the top 20 selling funds on adviser platforms during the third quarter of 2016, according to consultancy firm Financial Clarity.

Cowell says 95 per cent of flows into the range came from advisers through platforms with multi-asset funds being the main source of inflows into the range.

He also claims the range represents 50 per cent of all flows in the multi-asset sector.

Vanguard is set to launch a D2C proposition early this year, as revealed by Money Marketing in October.

Cowell confirmed the Life Strategy range will be offered as part of the new service.



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There are 2 comments at the moment, we would love to hear your opinion too.

  1. Thanks Vanguard 😉

  2. Fair play to Vanguard, they always said that they would pass on investment cost savings where possible. Good to see them stick to their word.

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