One of the benefits of being a member of the UBC Faculty Pension Plan (FPP) is the low management fees associated with the Plan. The Plan offers a diversified selection of investment funds and guaranteed funds to help you build your portfolio. The Plan’s Board of Trustees have negotiated fees that are typically lower than what you would pay if you invested in these funds at a Canadian retail financial institution or investment dealer. For instance, the average mutual fund fee charged by retail institutions at the end of 2014 was approximately 2.2%, whereas the funds available in the UBC FPP have much lower fees. Fees have a significant impact on the value of your investments over time. Lower fees mean that more of your money stays invested and continues to grow.
What are the fees charged to the UBC FPP?
The following table shows the Fund Management Fees (FMFs) charged to the Plan as at July 31, 2016. It is important to note that the fees can change monthly as many of the investment managers employed by the Plan have a fee structure that is based on the size of the Plan’s assets. Therefore, as the Plan’s assets change, so do the Plan’s fees.
UBC Faculty Pension Plan Fund Management Fees as at July 31, 2016
|UBC FPP Balanced Fund||0.49%|
|UBC FPP Bond Fund||0.37%|
|UBC FPP Canadian Equity Fund||0.47%|
|UBC FPP Foreign Equity Fund||0.51%|
|UBC FPP Short Term Investment Fund||0.19%|
The Plan also offers guaranteed funds through Sun Life Financial. Although these funds do not have specific investment fees, there is an administration cost of 0.10% which is included in the guaranteed fund term rates.
Fees that are applicable in non-recurring circumstances include short-term trading fees. A short-term trading fee of 2% will be charged to your account when you initiate an interfund transfer into a fund followed by an interfund transfer out of the same fund within 30 days. The short-term trading fee does not apply to guaranteed funds or the UBC FPP Short Term Investment Fund. Other than the short-term trading fees for interfund transfers, there are no fees for buying, selling or switching funds.
What do the UBC FPP fees include?
The fees for the UBC FPP include:
Governance and oversight. The Trustees are responsible for the management and oversight of the Plan including the administration and the investment of the assets. Participation in ongoing education and training is important, and the Board encourages Trustees to attend conferences and seminars related to the diverse and complex issues they face as fiduciaries and administrators of the Plan. The Trustees have also hired an Executive Director, Investments, who assists the Trustees in their governance duties as they relate to the Plan’s investments, and an Executive Director, Pensions, who is responsible for operations of the UBC Pension Administration Office and serves as Secretary to the Board.
Investment management services. The day-to-day investment decisions are made by external investment managers hired by the Trustees, under the oversight of the Executive Director, Investments. The external investment managers are responsible for selecting investments within their mandate to meet specified performance targets.
Custodial and Valuation Services. The assets of the FPP are held and secured by Sun Life Financial. Sun Life Financial is also responsible for the valuation of the funds and reconciles the investment manager statements to their records and provides detailed statements of each investment option to the Trustees.
Benefit recordkeeping and administration. Sun Life Financial, as record keeper, is responsible for collecting member contributions, depositing them to the Plan, recording the amounts to member accounts, calculating and adding investment earnings to account balances, preparing quarterly member statement of accounts, and administering benefit payments when a member terminates or retires. Sun Life Financial and the UBC Pension Administration Office work together to ensure the administration of the Plan is efficient and accurate.
Member Services and Communication. The UBC Pension Administration Office provides member services, such as pension seminars and one-on-one meetings, and member communication including the Plan website and newsletters. In addition, Sun Life Financial provides member services through their Customer Care Centre with a dedicated phone number for UBC FPP members,1-844-UBC-3131.
How are the fees deducted?
The fees are billed directly to the investment funds and are deducted prior to the calculation of a unit value. The unit value is then used to calculate your account balance. In other words, the cost of investment and administration services is charged as a percentage of assets.
Where can I view the fees?
You can view the most current fee information by signing in to mysunlife.ca/ubcfpp. Under Investments, select Manage plan > my plan > Plan overview > Account fees.
|Learn more about the importance of fees and the fees charged by the UBC FPP by reading the Why Fees Matter article on our website.|
 The Investment Funds Institute of Canada. Monitoring Trends in Mutual Fund cost of Ownership and Expense Ratios. May 2015. Web. 3 August 2016.