Automatic enrolment - is it your pension's turn?
Are you in a job at the moment? If the answer is yes, you could gain from learning about pension auto-enrolment. Even if it's just you and your boss, you could benefit. And by 2018, all employers will have to offer you a workplace pension by law.
Between 2012, when auto-enrolment was introduced, and the end of October 2015, 5 and a half million people now have a workplace pension and 67,892 employers have enrolled their employees, according to the Pensions Regulator.
If this is coming as news as you, don't worry. We asked one of our pension specialists, Teresa Fritz, to answer some questions for us, and tell you the questions you should be asking your employer.
Q: What is auto-enrolment and how will it affect me?
Under a law introduced in 2012, all employers must eventually offer a workplace pension scheme and automatically enrol eligible workers in it. Once you're enrolled, not only will you pay in to it but so will your boss and you may also get tax relief from the government.
Millions of workers are being automatically enrolled into a workplace pension by their employer. If you aren't one of them yet, you might want to check when you will be.
Your employer will have to explain in writing exactly how automatic enrolment will affect you. In many cases this will be done by letter, but some employers may use other methods, such as email.
Q: When will my employer tell me about auto-enrolment?
The precise timing of your employer telling you about automatic enrolment depends on the size of the business you work in.
The largest employers started enrolling workers first, followed by medium-sized ones. The smaller employers are starting between now and 2017 and the whole process will be complete by 2018.
Your employer will be in touch around the time that they have to start automatically enrolling their workers.
Q: How do I know whether I'm eligible? What other questions should I be asking?
Here are some other questions you can ask your employer.
Am I eligible to be automatically enrolled into a workplace pension?
How are you going to choose a workplace pension? For example, are you going to get help comparing things like charges and fund choice?
What type of pension is it?
How much will you be paying into the scheme and how much will I have to pay in? If your employer can't help with this one, we have a workplace pension contribution calculator which can help you.
Help us demystify the maze, including what to do if you don't want to be enrolled
Q: My employer isn't sure about auto-enrolment. Is there any help for them?
If your employer is looking a bit lost and you think they might need some help, tell them to check out the DWP and Pension Regulator's campaign 'Don't ignore the workplace pension'.
This article is provided by the Money Advice Service.
