Enrolling into a pension at work :Cross Stitch – Pensions and retirement planning
Starting from October 2012, employers will enrol workers into a workplace pension, if they meet the criteria below. When you pay into your pension, your employer and the government will contribute too. Find out how this affects you, when this will happen and the benefits.
A workplace pension is a way of saving for your retirement arranged through your employer. It is sometimes called a ‘company pension’, an ‘occupational pension’ or a ‘works pension’.
Your employer will enrol you into a workplace pension if you:
- are not already in a pension at work
- are aged 22 or over
- are under State Pension age
- earn more than £8,105.00 a year
- work in the UK
Your employer will write to you to explain how the changes affect you.
When you will be enrolled depends on the size of the organisation you work for. Very large employers are doing it first, in late 2012 and early 2013. Other employers will follow sometime after this, over several years. Your employer will give you the exact date nearer the time.
People are living longer. You could be retired for twenty years and you need to think about how you’ll fund it.
The State Pension is a foundation for your retirement. But if you want to have more when you retire, you may want to consider contributing to a workplace pension. The full basic State Pension in 2012/13 is £107.45 per week for a single person.
The government is getting employers to enrol their workers automatically into a workplace pension so it’s easier for people to start saving.
A pension is a way of saving money to provide you with an income when you retire. There are many benefits to having a pension at work.
Your employer will pay into it. This contribution from your employer means your pension can build up more quickly than if you were saving for your retirement on your own.
The government will also pay into it, in the form of tax relief. This means some of the money you earn, instead of going to the government as income tax, now goes into your pension instead.
Your workplace pension belongs to you, even if you leave your employer in the future.
As your employer will automatically enrol you into this pension, it’s a hassle free way of saving while you earn.
Being in a workplace pension is an important step towards giving yourself the lifestyle you would like in later life.
Please note the earnings figure listed above, (£8,105.00 a year) may change each April. If it does, this page will be updated.