Automatic saving for the people

It’s been the law since 2012 that all employers must offer a workplace pension scheme and for all eligible workers to be automatically enrolled into one – you might have heard it called auto-enrolment or you may have seen the workplace pension adverts.

In the past the decision to be in a pension scheme was left entirely up to the individual, but for those choosing not to save for their futures, the problem of poverty in retirement became a serious issue. Auto-enrolment was introduced as a solution to help working people to save for retirement.

As a reminder to be auto-enrolled you need to:

• work in the UK
• not already be in a workplace pension scheme
• be at least 22 years old, but under State Pension Age
• earn more than £10,000 a year (tax year 2017/18)

Is this you? Yes? If so, then you’ll be in your workplace pension and should have had some information about it. If not, contact your Human Resources (HR) department for further guidance.

Important information! If you are lucky enough to have been auto-enrolled by your employer contributions are set to increase from 2018 – be aware that there will be a 2% increase between 2018-19.

Here’s what will happen from 6 April 2018:

When?	Employer	You	Total
6 April 2018	2%	3%	5%
6 April 2019 onwards	3%	5%	8%

 

 

 

 

 

 

It’s worth remembering that these are the minimum contribution levels. You might be lucky enough to have a generous employer who will pay in more, or you could think about increasing your own contributions. Even a small increase could make all the difference.