Company Pension Plan - delayed investment

sjh1978

Hi there,

I just wanted to gain an opinion as to whether this is the 'norm' or not.

Mycompany recently started a new pension scheme (they ditched the Final Salary Scheme) with Blackrock. We do not contribute, as such, but th ecompany makes a salary sacrifice on our behalf (Employers Special Payment) and double matches this (Employer Contribution).

I get paid on the 15th of each month, but have noticed on our online pensions system that the contrinutions do not get invested until the 23rd of each month.

I feel as if I am losing out both ways - not having the cash in the bank account and it not being invested for eight days.

I have asked my company's pensions team to expalin , but have not had a response. Is this the norm and I am over-reacting, or am I and fellow employees losing out on eight days of investment each month. I probably have 35 years service left, so the cumulative effects (to me) seem large,

Any thoughts?

Steve

dunstonh

feel as if I am losing out both ways - not having the cash in the bank account and it not being invested for eight days.

Why do feel that not having the cash in your bank account is losing out? After tax and NI, you wouldnt get the full amount and you wouldnt get the employer contribution.

7 days seems quite reasonable to get it from their bank account to the provider and applied to the pension.

Is this the norm and I am over-reacting

I think you are to be honest. The provider will direct debit from your employer's business account and has to wait for that to go through the clearing cycle.

Also, as investments zig zag in value, some months you will find that 8 days delay makes you better off and some months worse off. They will largely get cancelled out. i.e. Markets today are lower than they were 8 days ago. So if the purchase went through today, you would be better off compared to 8 days ago.

sjh1978

Thanks for that insight dunstonh. I really didn't know if it was a big deal or not, and I understand the 'swings and round-a-bouts' element to it.

At first glance it simply seemed that my salary sacrifice and employers contributions were sitting in a bank account for eight days.

I should learn to have more faith.....:D

Cheers

Rainmaker_uk

sjh1978 wrote: »

I should learn to have more faith.....:D

Cheers

Whatever you do never have more faith in finance and never stop questioning.

It is through questioning that you increase you financial intelligence and ensure some greedy banker does not run off with your money