stakeholder pension scheme

In the UK, a type of low-cost pension available since April 2001. Employers with five or more employees have to make a stakeholder pension available to their staff. Stakeholder pensions are bought from authorized financial institutions, such as insurance companies, banks, and building societies. The pension providers can only charge a maximum of 1% of the value of the pension fund each year to manage the fund, plus costs and charges. Any extra services and any extra charges not provided for by law, such as advice on choosing a pension or life assurance cover, must be optional. All stakeholder schemes will accept contributions of as little as £20, payable weekly, monthly, or at less regular intervals. The scheme must be run by trustees or by an authorized stakeholder manager.