Have I got a company pension?
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Don't worry if you are reading this and have suddenly realised
you know absolutely nothing about your company pension scheme. You
are not alone. Many people have no idea what sort of
pension their scheme may provide. Many do not even know whether
they are in a scheme or not. However if you are reading this
then I assume you must have an interest in finding out and we
would encourage you to do so. After all how can you plan properly
for your retirement if you haven't the faintest idea what your
company pension scheme might provide?
If you are intending to find out how your pension scheme works
(or even what type of pension scheme it is) then you should
obtain a copy of the scheme booklet from the HR department or
Pension department at your company. Every well run scheme should
have a scheme booklet. You should have been given a copy when you
joined the scheme. The scheme booklet will explain how your
scheme works, if you have a defined benefit (DB) scheme it will explain
how your pension is calculated. If you have a defined contribution
(DC)
scheme it will tell you the amount the company contributes.
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Trust Structure
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Many company pension schemes are held under Trust. This means
that the assets of the pension scheme are held separately to those
of the company and therefore the company cannot (in normal
circumstances) raid the pension fund for money.
Trust law means that a board of Trustees must be appointed to
look after the assets (i.e. the money) of the Trust. It is the job
of the Trustees to ensure that they run the Scheme in accordance
with the requirements of the Trust Deed and Rules (see later).
This document sets out the rules under which the Trustees must
work. Trustees have a duty to act in the interests of the members
of the scheme as a whole. Trustees have a number of
responsibilities in relation to pension schemes including the
investment of the assets and the administration. However most
Trustees will appoint external companies to handle these
specialist functions.
Most company pension schemes are held under
Trust but some are run by insurance companies. These are generally
for smaller to medium sized company schemes and are
called Group Personal Pensions (GPPs) (just a collection of
individual pensions really).
The scheme booklet is the document which will be of most
use to you if you want to know more about your company pension
scheme. However you are entitled to see other documents which
govern your scheme and if your scheme is held under Trust then you will be entitled to see a
copy of the Trust Deed and Rules. This is the legal document (so
may be difficult to read) which
governs how the scheme is run. If you want a definitive guide to
the rules of the scheme this is may be the document for you.
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If you have a pensions
related question then please let us
know.
If it's something other people
would find useful then we will post an answer in our Frequently Asked Question
(FAQ) area.
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Read the guide to
investment in the pensions guide. It explains what you need to
think about before investing for your retirement.
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to get an estimate of your basic state pension.
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