Company Pension agreement... is it good?

webbhost

Okay, probably going to sound like a daft question but always best to be sure before jumping to conclusions...

I know theres something going on with regards to companies being required to place their employees onto a pension scheme... My company has released its details and I wanted to know... is it good or can I get better elsewhere?

The basics are that they have said that I will be paying 5% per month into my pension (as a minimum), which will work out at about £50 a month.
They have then said that they will put in a contrubution worth 3 x the amount (their wording is that for every £4 I put in, they put in £12 making a total of £16)... so at my £50 a month, I should be having £200 a month going into my pension fund.

Does this sound like a good deal or can I get a better deal by opting out and setting up a private pension elsewhere?

If you need any more details (Without my disclosing the company, I'd rather not) then I'll answer if I can!

webbhost

Also, it says on the first page that the pension scheme is run as a trust and its assets are held in a trust fund completly seperate of *company* Assets.

Does this mean that in the event that the company I work for goes bust, my Pension is 100% safe and will not be effected by the companies liquidation?

Thanks

Lokolo

Your company pension is very good and you should do all you can to maximise the free money your employer is giving you.

I suspect there is a limit to the amount they will put in, you should check what this is.

(not sure why you thought putting money outside of your company pension could be better, but I guess you never know if you don't ask! You will find pension schemes outside companies are used by those who companies don't offer anything, or if people want to invest in more than what their company pension scheme offers)

To answer your second question - yes, but thats not a specific thing to your company, it happens with all.

webbhost

cool, sounds good..

With regards to the "limit" you mention, they mention no limit on the 5% of my wages bit... However, reading it carefully, it does not state anywhere that they will make any form of contribution if I decide to make any AVC's?

Infact it doesn't have much information at all about AVC's.. would this suggest I may find a better deal if I want to make additional contributions elsewhere? Going to look online to try and find additional info, will post if I find an update

Lokolo

There is usually a limit to the matching and bonus contributions. For example it might say along the lines of "Company X will contribute 3x the employee contribution up to an employee contribution of 10%".

For any additional contributions I would be looking to save outside of a pension, such as a S&S ISA. This will then give you more choices for later on in life.

McKneff

It's all free money, man,

Grab it with both hands...........

somethingcorporate

You can put it in a private pension where £1 buys you £1's worth.

Or put it in your company pension where £1 gets you £4.

Seems like a good deal, no?

It's a cracking deal, grab it with both hands!

opinions4u

Sounds exceptionally good.

Almost too good to be true. Read the small print carefully.

Assuming it is what your post says, be part of it.

Andy7856

Like many other postings, if your employer is adding money, then its FREE money!!! and grab it whilst you can!

mania112

somethingcorporate wrote: »

You can put it in a private pension where £1 buys you £1's worth.

Or put it in your company pension where £1 gets you £4.

It's not worth mentioning that £1 in a PP isn't £1, so I won't mention it

Yes, if the company goes bust your pension funds are in a separate pot (held with one of the well known insurance firms, no doubt.... and if they go bust there's further protection their too!)

somethingcorporate

mania112 wrote: »

It's not worth mentioning that £1 in a PP isn't £1, so I won't mention it

Yes, if the company goes bust your pension funds are in a separate pot (held with one of the well known insurance firms, no doubt.... and if they go bust there's further protection their too!)

True, that £1 in the pp would only be 80p in the OPs pocket!