Prudential with-profits pension fund: performance and charges

The Prudential with-profits pension fund runs in two ways, traditional bonuses or PruFund growth rates, and each has its own rules for leaving.

Which Prudential with-profits pension fund do you hold?

Prudential publishes a separate guide for each kind of with-profits plan, so the answer starts with your paperwork. Its unitised guide covers "Prudential Unitised With-Profits Plans, such as Prudence Bond, personal pensions and Prudence Savings Account", while another covers conventional plans, including "those pension plans where the benefit is expressed in the form of yearly income". PruFund has its own range guide. Your yearly statement and key features document show which one you have. Unsure which of these your pot is in? Begin with the statement; an FCA-authorised adviser can then look at it with you, and a free call to do so is requested through this page’s enquiry form.

Whichever you hold, the value can go down as well as up and you may get back less than you paid in. Past performance is no guide to what comes next.

How do bonuses and smoothing work in the traditional fund?

The traditional fund shares its profits by adding bonuses to your plan, and Prudential describes two kinds. A regular bonus is "normally added throughout each year", and Prudential can change the rate without prior notice. A final bonus "may vary and is not guaranteed", and the unitised guide adds that if returns have been low over the life of a plan, a final bonus might not be paid.

Prudential explains smoothing this way: "We do this by holding back some of the investment returns in good years with the aim of using this to support bonus rates in the years where the investment returns are lower." It adds that smoothing cannot stop a plan losing value when returns have been low.

Shareholders take a share too: Prudential says they are entitled to 10% of any profit, with the remaining 90% going to planholders through the bonuses allocated.

How does PruFund work differently?

PruFund does not add bonuses; your units rise at an Expected Growth Rate, set by the Prudential directors every three months, and the rate can go up or down. The PruFund guide says these are "the annualised rates which we’ll normally apply daily to the unit price of the funds".

The published unit price can drift from the value of the underlying assets, so Prudential checks the gap; past a limit the price is adjusted, up or down. For the PruFund Growth Pension/ISA Fund the guide’s table shows a quarterly limit of 5.0% and a daily limit of 10.0%; other funds differ.

The guide also states: "There is no fixed payout amount, as a result of the pricing and smoothing mechanisms used for the PruFund range of funds". Some product options do guarantee a minimum, and the guide sends you to your product literature for them.

What can cut your payout if you leave, and which dates are protected?

A market value reduction (MVR) can be applied when you take money out of the traditional fund, but only if the assets behind your plan are worth less than the plan including bonuses. Prudential says it applies one to protect people who stay in the fund, and "We might apply an MVR if you take money from your Plan at any date other than when a guarantee applies."

For pensions, Prudential gives the selected or normal retirement date, or death, as examples of those dates; your key features document sets out when a guarantee applies to your plan. If an MVR does apply, you "might not get any final bonus, or the full value of your regular bonus", and could even get back less than you invested, though the payout will not fall below the unsmoothed value. Prudential’s Principles and Practices of Financial Management (PPFM), version 2.3 of April 2026, adds that an MVR may apply only outside any MVR-free guarantee period.

Leaving PruFund brings a different catch: units cancelled on a switch, transfer or withdrawal "may be subject to a delay of up to 28 days". See how MVRs work generally and moving a Prudential pension. When a Prudential transfer figure lands, an adviser can say what any cut to it means for your pot; your free call-back begins with this page’s enquiry form.

Do older Prudential plans carry guaranteed annuity rates or minimum values?

Some may. The PPFM says the With-Profits Fund "currently has exposure to" guaranteed annuity rates, with derivatives bought to limit the cost if yields fall, so such guarantees exist in the fund. For pension plans, Prudential also says annuity rates at retirement "might also have a significant effect" on what you get. Whether your own policy has a guaranteed rate is set by its terms.

On unitised plans the guaranteed minimum is the amount invested (adjusted for any withdrawals), less charges, plus regular bonuses already added; Prudential says it applies only on leaving at particular times. Conventional plans guarantee the sum assured and attaching bonuses on the same terms. Moving the money elsewhere can end a guarantee that was worth having, which is why whether to move a with-profits pension starts with the paperwork. The guaranteed annuity rate explainer and a page on keeping one cover the value side.

For using the pot later, see Prudential withdrawals and annuities.

What does it charge, and how has it performed?

Charges differ by plan, and the key features document is the place for yours. Prudential’s PPFM says that for most traditional with-profits policies "the total deduction charged to asset shares over the lifetime of each investment is currently capped at 2% of asset shares, gradually building up to this level in the early years". For PruFund the charge for guarantees and smoothing is typically inside the annual management charge, which the guide says is taken by cancelling units. Typical pension charges give context.

One scheme’s published figure shows how it can look: the Universities Superannuation Scheme’s 2026 report put the investment management charge on Prudential with-profits policies held for its members’ additional contributions at 1.27% a year, at the time of writing. That is USS’s arrangement, not a price for everyone.

Prudential publishes the PruFund Expected Growth Rates for each product every three months at pru.co.uk/egr.

Prudential with-profits pension questions

Where are Prudential’s with-profits guides for each type of plan?

Prudential’s Principles and Practices page offers "simpler guides to our with-profits products", chosen by product type, and invites you to get in touch if you are unsure which one applies. Match the guide to the plan type on your statement.

Is a Prudential with-profits pension the same as an M&G pension?

Prudential’s pages say Pru is part of M&G; M&G pensions explained sets out how the names fit together.

What if I have lost the paperwork for an old with-profits plan?

Prudential itself and the free Pension Tracing Service can help find it; tracing a Prudential pension explains how.

Who gets a Prudential with-profits pot after death?

That depends on the plan and your nominations; Prudential pensions on death covers it.

Where can I get help weighing it up?

Pension Wise gives free, impartial guidance: what Pension Wise is. Prefer to talk your own plan through? A name and phone number in the form here is all an adviser needs to ring you.