Pension Newbee

fattony

Hi

I work for a small elecrical contractor, there are 2 directors and 4 employee's, we have never been offered a pension and from I've read they dont have to until they employ 5 people, I've also read that the employer doesnt have to contribute to the employee's pension.

Surely if the employer was forced to make a pension contribution if in full time employment etc then this would help ease the state pensions etc.

Anway, Im not sure how much I could afford to put away each month but Im guessing a stakeholder pension is the direction I should be lookng at, can anyone suggest a good company to go with?

dunstonh

we have never been offered a pension and from I've read they dont have to until they employ 5 people, I've also read that the employer doesnt have to contribute to the employee's pension.

Until 2012 they dont have to pay into a pension. From 2012 they will. The 5 employee rule is more or less obsolete now. Its being removed pending the 2012 changes and it is no longer enforced.

Surely if the employer was forced to make a pension contribution if in full time employment etc then this would help ease the state pensions etc.

It would have no impact on the state pensions as they are based on your NI contributions. However, they would reduce pension credit in the long term although that too is being watered down a bit with its qualifying age being increased from age 60 to 65 then through to 68 to match state pension age.

There is a risk that because of the NPSS and forced contributions, that employers will have to reduce staff numbers or not give pay increases for a number of years.

Anway, Im not sure how much I could afford to put away each month but Im guessing a stakeholder pension is the direction I should be lookng at, can anyone suggest a good company to go with?

Too many variables to suggest a company or pension type. its clear SIPP isnt best for you but personal pension could be cheaper than stakeholder. You need to ask the employer what they are doing from 2012. Are they going to introduce their own group scheme, are they going to pay into members own schemes or are they going to delegate to the Govt. If its like most companies, they wont know that the NPSS rules are coming.

fattony

dunstonh wrote: »

You need to ask the employer what they are doing from 2012. Are they going to introduce their own group scheme, are they going to pay into members own schemes or are they going to delegate to the Govt. If its like most companies, they wont know that the NPSS rules are coming.

Thats a really helpful comment do you have any more information about this that I can direct my employer to, their not that pro active on these types of things

dunstonh

take a look on google for NPSS or personal accounts (same thing but name change has occured).

fattony

will do thanks

fattony

I just googled it and found this


A new National Pension Savings Scheme (NPSS) should be established by 2010


So is it by 2012 or 2010?

dunstonh

It was initially put for 2010 but like most things it got put back to 2012.

Try this one:
http://www.dwp.gov.uk/pensionsreform/new_way.asp

And the pensions act enacted in Nov 08:
http://www.dwp.gov.uk/pensionsreform/pensions_act_2008.asp

Robert_Sterling_3

The Conservatives might be in by 2012 so who know when, or if, it will ever happen?

fattony

thanks for the links