New Company Pension Nest Scheme

planteria

my employer has introduced a new company pension, as of 1st June, which i understand they have had to do as the Workplace Pension is mandatory and the number of employees meant that this was the month it had to be introduced.

along with May payslip i received 3 letters re. the new pension scheme, which largely give me the same information. and there is not a great deal of it.

it seems that they are committing to matching 1% of gross pay being contributed into a Nest scheme. I think they are offering the bare minimum, which will then increase along with government guidelines.

is just 1%+1% common? are employees asking employers to match a larger employee contribution? and what do people think of the Nest scheme?

dunstonh

giving up a small amount of gross income for it to be more than doubled and then invested 1%+1% common?

As you say, it is the minimum.

re employees asking employers to match a larger employee contribution?

Employers of larger companies or those that value their staff more, do go beyond the 1%. Figures at 5-15% are not uncommon.

and what do people think of the Nest scheme?

it is the most basic option available. However, it is suited to very small employer (say under 25 employees). Small companies just cant afford to pay for full occupational schemes and the insurers are not really interested in small schemes. So, there are 3 or 4 providers that cater for the small employer and NEST is one of those.

planteria

thank you dunston.

i have read some of https://www.nestpensions.org.uk

so over time 1%+1% will become a minimum of 5%+3% by October 2018, which will be far more useful. the government are just getting started with this, and at those contribution levels it will make a difference in years to come.

https://www.nestpensions.org.uk/schemeweb/NestWeb/public/helpcentre/contents/how-do-my-contribution-levels-and-earnings-basis-affect-my-contribution-rates.html

planteria

has anyone here been auto-enrolled at the minimum 1% from them and 1% from their employer and successfully persuaded their employer to contribute more to their pot?

and if someone leaves a job with an employer providing a Nest scheme, can a Nest scheme pot be transferred to another provider?

Mothman

planteria wrote: »

has anyone here been auto-enrolled at the minimum 1% from them and 1% from their employer and successfully persuaded their employer to contribute more to their pot?

and if someone leaves a job with an employer providing a Nest scheme, can a Nest scheme pot be transferred to another provider?

As far as I am aware you cannot currently transfer a NEST pot to another provider but I believe this should be changing in 2017.

The company I work for contributed the full 3% from day one, however staff were told that this was given in lieu of the pay increase they were due that year:(.

planteria

i see, ok thanks.
maybe in the long-term that is to their benefit.
i certainly think that employers looking after their staff via their pension contributions should be seen as a positive.

planteria

had an email response from my employer telling me that a pack will be sent to me direct from Nest.

"Due to current trading [we] have decided only to meet the minimum requirements therefore it is only on qualifying earnings above the minimum - you are free to contribute more but the company will not match it."

"...it is not a scheme where there is investment choices – the pack should explain all this to you."

planteria

received the letter and leaflet from Nest.
there is nothing pressing, so it's not really a problem, but tried to set up my online access. the website is a disaster, crashing at all different stages and saying that they are having difficulties..
i guess a lot of people are newly set up so they will be having high volumes checking it out... but you'd have thought they'd be prepared for that.:idea:

jamesd

Nest has a few choices but they aren't particularly wonderful and their relatively high charge on new money being paid in is not great either but it is still better than nothing and best viewed in that way. Simply go with the legally required amounts to maximise how much gain you get on your money.

Your employer can probably save a little employer NI by using a salary sacrifice scheme. This saves employees their employee NI and saves employers their employer NI, though it's normal for employers to share half or even all of the saved employer NI.

Nest is a fine choice for people with a single part time nanny as their sole employee.

planteria

thank you james.

i tend to agree. i will just go along with the minimum, on the basis that this is all i need to do to max my benefit from my employer. that is the value in the scheme, really.

jamesd wrote: »

...it's normal for employers to share half or even all of the saved employer NI.

is it? i don't think mine will be.:think:.

in fairness the directors are good people and i'm not unhappy with my role. and there are plans for a share save scheme too, which sounds interesting.

at the same time it seems clear that the Nest scheme is something that they are doing because they have to, and nothing more. in fairness, that will be the case for many, many employers. and if lots of people have some more money to live on in retirement as a result, good.:)

jamesd

Well, even if they keep all of the employer NI you'd be able to gain from the reduced employee NI, so in that respect it is a win-win situation even if they do keep all of the employer portion.