Whether retirement is years away for you or it is fast approaching, saving for retirement is a crucial part of financial planning at any stage of life.
Workplace pensions
Workplace pensions play a significant role in helping you build a secure financial future when you retire.
Pension auto-enrolment
In the UK, employers are required by law to enrol eligible employees into a workplace pension scheme and contribute to their retirement savings. The minimum auto enrolment contribution to an employee’s pension savings is 8% of their salary. Employers must contribute at least 3% of this and employees must make up the rest.
Who is eligible for auto-enrolment?
Employees who are automatically enrolled to a workplace pension scheme must earn more than £10,000 per year, normally work in the UK and be aged over 22 but under the state pension age.
This means some part time employees may not be eligible for a workplace pension.
What is employer matching contributions?
Some employers offer matching contributions as part of their workplace pension scheme.
This means that they will match employee contributions to their pension up to a certain percentage.
If you are able to and your workplace offer this, then it is worth considering as this will significantly boost your retirement savings.
It is important that you review your employers pension policy as each employer is different.
Opt-out option
Automatic-enrolment is mandatory for eligible employees, however individuals have the option of opting out of their workplace pension scheme if they choose. However, it is important to be aware that opting out means that you will not receive any employer contributions which will allow you to build your retirement savings much quicker.
Make the most of your workplace pension
For help understanding your workplace pension or how to maximise the amount your employer pays into your pension, you can book a no-obligation meeting with a financial adviser at Four Wealth Management online or call us on 0117 973 0500.
The value of an investment with St. James’s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.
The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.
