What is a ‘good’ company contribution on DC scheme

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  • dunstonh
    dunstonh Posts: 116,296 Forumite
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    I once had a 15% employer contribution for some years. Although my first job had a non-contributory DB scheme (worth around 35% of my earnings if you had to put a cost on it).
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Filo25
    Filo25 Posts: 2,131 Forumite
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    Mine only matches employee contributions up to 5%
  • westv
    westv Posts: 6,081 Forumite
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    dunstonh wrote: »
    I once had a 15% employer contribution for some years. Although my first job had a non-contributory DB scheme (worth around 35% of my earnings if you had to put a cost on it).
    My first job had a DB scheme but it didn't start until you were 25 so, whilst I got 9 years of 1/60, I missed out on another 9 years prior to that.
  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    A 30-something in my family can contribute up to 5% and gets it double-matched up to 10%. That's on base salary and bonus. It's done by salary sacrifice.
    Free the dunston one next time too.
  • sandsy
    sandsy Posts: 1,719 Forumite
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    dunstonh wrote: »
    I once had a 15% employer contribution for some years. Although my first job had a non-contributory DB scheme (worth around 35% of my earnings if you had to put a cost on it).

    I had a non-contributory DB for my first 10 years of employment too.

    My employer currently pays 15% - made up of 12% base plus 3% matched, plus half the NI savings via salary sacrifice. But younger staff have a lower base.
  • Notfarfromtheborder
    Notfarfromtheborder Posts: 176 Forumite
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    9% base with no contribution
    extra 2% matched
    All by SS, all NI returned on sacrificed amount


    Worth about £10K into the pension from the above amounts alone
  • Novice_investor101
    Novice_investor101 Posts: 873 Forumite
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    My old employer matched up to 7.5%. they had a DB scheme that I was in for 10 years that closed. My current employer pays in 14% to my 8%. That's the highest matching amount, it goes down on a sliding scale if I reduce my contributions. Current all via sal sac.
  • Shimrod
    Shimrod Posts: 1,069 Forumite
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    Here's some more figures on contribution rates by sector. These are from 2009, so bear in mind the averages have dropped since auto-enrolment came in. This is from the 2009 Aon Benefits and Trends survey.



    Key findings:
    Average total contribution across UK sectors is 9.7%.


    Average employer contributions across the UK are currently 6.2% of an employee!!!8217;s salary


    Those in financial services fare best with a combined pension pot of 11% (a 8.4% employer contribution but only 2.6% employee).


    Those in leisure and travel are worst off with a combined pension pot of 7% (a 4.1% employer contribution and 2.9% employee).


    Employers across all sectors contribute at least 4%.


    The retail sector displays the least disparity between employer and employee contributions. 4.3% and 4% respectively.
  • TcpnT
    TcpnT Posts: 277 Forumite
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    Before I I retired last year my company doubled employee contributions up to 8%. So for an 8% employee contribution they contributed 16% - total 24% of all salary and bonuses. This was a very generous scheme but it was with a major international oil service company and their scheme was intended to offer similar benefits to the major oil companies.
    I also benefited from some legacy terms which were no longer on offer to new employees. Contributions were the same for recent starters but were paid on base salary only which was a massive difference.
  • Brynsam
    Brynsam Posts: 3,643 Forumite
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    Don't forget to set this in the context of the overall remuneration package. A 'mean'(!) employer contribution of 'only' x% might look better if there's a bonus which is regularly in the order of 50% of salary, say... There's nothing magic about remuneration being paid as a pension contribution, albeit there are tax advantages.
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