Company pension presentation

RobertinHerts

My company is giving a presentation tomorrow on their new scheme for those who have not been in their previous Final Salary scheme, which has been closed.

I need to know what questions I should be asking for both my and others benefit. I'm suprised I can't find any information on MSE and I've also trawled this forum but to no avail

I'm assuming there are various types to I guess the first thing I need to know is the type of pension plan it is?

From the information given to those who transferred from the old scheme it appears that we will be able to chose which funds the investments are in within a restricted Legal and General package.

What's the typical level of management fees I should be looking for?

Any guidance appreciated. Thanks.

Robert

purch

You could always ask them, what return do I need to achieve to equal the guaranteed return of the final salary scheme.

yelf

you'll get all that in the presentation I would expect. It'll be a GPP. Check how much the company will contribute

yelf

purch wrote: »

You could always ask them, what return do I need to achieve to equal the guaranteed return of the final salary scheme.

i fail to see how that will help

dunstonh

I need to know what questions I should be asking for both my and others benefit. I'm suprised I can't find any information on MSE and I've also trawled this forum but to no avail

There is quite a lot in this forum but you shouldnt expect an article on it as Martin has frequently said that he doesn't really get into areas covered by IFAs and what involves regulated financial advice.

i fail to see how that will help

Only to see how much they are losing out by the scheme closing.

What's the typical level of management fees I should be looking for?

On a group scheme only offering internal funds you wouldnt expect any more than 1% p.a. and if the employer is large then lower than that down to around 0.2% depending on scale.

RobertinHerts

yelf wrote: »

you'll get all that in the presentation I would expect. It'll be a GPP. Check how much the company will contribute

GPP? Thanks but where can I find out what a 'GPP' is?

RobertinHerts

purch wrote: »

You could always ask them, what return do I need to achieve to equal the guaranteed return of the final salary scheme.

I assume the Final Salary aspect was more relevant to the session, held a few months back, for those having to switch.

This session is for those of us who have not been involved in the previous scheme.

Loughton_Monkey

RobertinHerts wrote: »

GPP? Thanks but where can I find out what a 'GPP' is?

Group Personal Pension.

I guess you have to accept that 'the game is up' regarding the Final Salary Scheme. As you are aware, the cost of these has been crippling to employers.

Since you seem to be talking simply to specialists involved in the new scheme, it doesn't seem appropriate to ask any of the 'emotive' questions that are more aimed at the employer (like 'why are you doing this to us', or 'why don't you put more money into it?'...)

So, reluctantly, you probably have to accept the new arrangement. All I can suggest is that you use the opportunity to ensure that you fully understand what the scheme is all about. The charging rate is a key piece of information (irrelevant in a FS scheme), as is the choice of funds (again irrelevant in a FS scheme).

You should try and understand the mechanism for fund 'switching' and whether or not this will cost you anything. You should also try to understand the risks involved in each type of fund so that you can make sensible decisions (given your age) about how to distribute your contributions between funds.

Try also to get a committment that (at the company's expense) a suitable IFA is usually on hand to answer reasonable questions and provide guidance.

RobertinHerts

Loughton_Monkey wrote: »

Group Personal Pension.

I guess you have to accept that 'the game is up' regarding the Final Salary Scheme.

All I can suggest is that you use the opportunity to ensure that you fully understand what the scheme is all about. The charging rate is a key piece of information (irrelevant in a FS scheme), as is the choice of funds (again irrelevant in a FS scheme).

You should try and understand the mechanism for fund 'switching' and whether or not this will cost you anything. You should also try to understand the risks involved in each type of fund so that you can make sensible decisions (given your age) about how to distribute your contributions between funds.

Try also to get a committment that (at the company's expense) a suitable IFA is usually on hand to answer reasonable questions and provide guidance.

Thanks most useful:)

I'm used to selecting, buying and selling shares / funds in my ISA. And 'Final Salary Scheme' is not on my radar anyway.

I like the question about availability of an IFA!

Is 'Charging rate' another term for Management fee? Or are there multiple fees I need to anticipate?

The cost of switching IS a useful question:)

Loughton_Monkey

RobertinHerts wrote: »

Is 'Charging rate' another term for Management fee? Or are there multiple fees I need to anticipate?

The cost of switching IS a useful question:)

Normally, the charges are embedded in the unit prices. So you put in £100 and buy 100 units at £1. After a while, the unit price is £1.20, and so your fund is truly 'worth' £120. But you have been 'charged' because without charging, the unit price would have gone up to £121 or something. But I don't know how your particular scheme will work.

In some schemes, switching can be limited (e.g. one per year), but I think charges are becoming rare.

However, watch for other comments since my own experience does not include GPP's (only Individual Personal Pensions).

jamesd

Is it a salary sacrifice scheme? If it is salary sacrifice, what portion of the employer NI reduction is contributed to the employee pensions (all is good, none is bad)?

Is there any restriction on transferring money out of this scheme into a personal pension I use myself? If it's salary sacrifice can I make a couple of transfers out a year and still benefit from the NI gain of of salary sacrifice?

Is there any restriction on transferring money into this scheme from a non-work personal pension?