Analysis – Page 11
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Analysis
How popular are pension scheme guarantees?
If you read nothing else, read this…The government is seeking a pensions landscape that shares investment and outcome risk between employers and employees.Pension scheme guarantees are one proposed remedy.Critics are wary about reintroducing guarantees.But now the pensions industry consensus is that the pendulum has swung too far, and that employees ...
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AnalysisCalculating the cost of auto-enrolment
If you read nothing else, read this ….Employers should complete a cost-impact assessment to determine their expected costs.With increasing contributions, ongoing administration and penalties for non-compliance, employers should be prepared for short-term and long-term costs.An investment is being made, so make sure there is value in that investment by communicating ...
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Analysis
How to review a default investment fund
If you read nothing else, read this …Default funds should be reviewed about once a year.Reviews should start by looking at the profile of the membership and the objectives of the fund.Employers should also examine the market to see what types of investment fund are available.David Harris, managing director at ...
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AnalysisAuto-enrolment prompts employers to review their benefits offering
If you read nothing else, read this…Most staff are remaining in pension plans once they have been auto-enrolled.Many employers are using the opportunity to promote their wider benefits package.There is some evidence of employers accompanying auto-enrolment with financial awareness sessions.Employers are not cutting other perks to cover auto-enrolment costs, but ...
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AnalysisHow to choose the best default fund
If you read nothing else, read this:Tailoring default funds to the scheme membership is not just about offering ethical and shariah options.Default funds should be designed with the specific nature of the workforce in mind, because employees of different ages and salaries will have very different needs.Almost all new pension ...
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AnalysisKey issues for employers post auto-enrolment staging
IF YOU READ NOTHING ELSE, READ THIS…Post auto-enrolment staging date, employers must keep on top of a number of tasks to remain compliant.Having robust record-keeping and data processes in place is key.Employers must ensure they send relevant communications to their workforce at the required times.Preparing for auto-enrolment may feel like ...
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AnalysisHow transparent are benefits charging structures?
IF YOU READ NOTHING ELSE, READ THIS…Historically, commission-based and consultancy charges in the pensions market led to a lack of transparency in what employers were paying for.Now that both have been banned, with the exception of legacy commission schemes, the pensions market has moved towards a more transparent fees-based model.Adviser ...
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AnalysisThe pros and cons of using lifestyle investment strategies for pension funds
IF YOU READ NOTHING ELSE, READ THIS…Lifestyle strategies progressively switch pension scheme members into bonds as they approach retirement.Although lifestyle options have done well over the past decade, this has been a consequence of rising bond markets.Providers have been devising diversified funds that are actively and tactically managed so members ...
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Analysis
The pros and cons of using multiple pension plans for auto-enrolment
IF YOU READ NOTHING ELSE, READ THIS…Using multiple pension schemes will not suit all employers.Running multiple schemes can be confusing and may increase communication costs.Communication strategies must clearly differentiate the benefits of each scheme.The Pensions Regulator (TPR) requires all workplace pension schemes to meet its qualifying criteria for auto-enrolment. A ...
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AnalysisPension rights for employees' partners
IF YOU READ NOTHING ELSE, READ THIS…Many pension schemes will have discretion to pay a pensions benefit to an employee’s partner if they are financially dependent or financially interdependent with them.A joint annuity can be applied to civil partnerships, same-sex and opposite-sex marriages, and co-habiting couples.There must be no distinction ...
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AnalysisTop five considerations for at-retirement strategies
IF YOU READ NOTHING ELSE, READ THIS…Trustees and pension providers must support employees when they are making their at-retirement choices.Online modelling tools can help crystallise employees’ at-retirement income.The open market option for annuities should be factored into at-retirement communications strategies.1. Regulatory requirementsThe Pensions Regulator (TPR) believes that defined contribution (DC) ...
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Analysis
What are target date pension funds?
IF YOU READ NOTHING ELSE, READ THIS…Target date funds are investment funds tailored to a pension scheme member’s date of retirement.Most target date funds are written to a three-year band, such as 2028 to 2030, rather than one specific date.Funds gradually de-risk, reaching their most conservative point at the target ...
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AnalysisGroup personal pensions in a master trust world
IF YOU READ NOTHING ELSE, READ THIS…Master trusts have a governance advantage over group personal pensions (GPPs) in terms of investment monitoring, default funds and annuitisation.They can also offer significant economies of scale and are cheaper than most GPPs.However, not all master trusts will survive the current demanding and low-margin ...
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Analysis
John Chilman: How to create a good default fund for staff
John Chilman, group reward and pensions director at FirstGroup, speaks to Debbie Lovewell, deputy editor of Employee Benefits, about how employers should go about selecting a default investment fund in order to create a great outcome for pension scheme members, which provides diversification and has good governance.He highlights the key ...
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AnalysisAuto-enrolment tips from Australia and New Zealand
IF YOU READ NOTHING ELSE, READ THIS…The Australian Superannuation Guarantee Fund was introduced 20 years ago as a compulsory scheme.New Zealand’s Kiwisaver, which was launched in July 2007, more resembles auto-enrolment in the UK, with employees allowed four weeks to opt out.Areas where UK employers can learn from both implementations ...
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Analysis
How should employers select auto-enrolment help?
IF YOU READ NOTHING ELSE, READ THIS…Many pension services are available to help employers through the auto-enrolment process.Support is available from pension and payroll providers, as well as employee benefits consultants.Employers may opt to use one or a range of consultants to help them implement their strategies.Auto-enrolment is likely to ...
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AnalysisWorkforce analysis is key to auto-enrolment
As the parent company of a range of smaller recruitment ?rms, Adecco will begin auto-enrolling staff on 1 March and will continue doing so at various stages until 2016. The organisation has 3,000 monthly-paid staff, who will all eventually be enrolled into a group personal pension (GPP) plan, while 20,000 ...
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Analysis
How to choose a payroll provider for auto-enrolment
IF YOU READ NOTHING ELSE, READ THIS…Payroll providers are a key part of the auto-enrolment process.However, not all payroll providers offer an integrated service.Employers should identify any gaps in their payroll provider’s service support as soon as possible.The payroll market spent much of last year under fire from employers and ...
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Analysis
What are white-labelled pension funds?
IF YOU READ NOTHING ELSE, READ THIS…White-labelled pension funds are growing in popularity as employers face more pension responsibilities.A white-labelled fund allows an employer to make changes without extensive employee communication.White-labelling can bring an element of future-proofing because employers are not tied to a single investment manager.Pension fund white-labelling is ...
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AnalysisAuto-enrolment: experiences so far
IF YOU READ NOTHING ELSE, READ THIS…The auto-enrolment process has brought new responsibilities for employers, for example, regarding the opt-out process.Employers have found auto-enrolment a useful catalyst for re-issuing communication to employees about their pension scheme.Employers that have begun to auto-enrol staff recommend that others allow plenty of time to ...