Final salary pension - a question.
Discussion
Hi.
This is my first post in this sub forum so please be gentle, and my knowledge of the ins and outs of pensions is limited, hence my question as follows:
I am lucky enough to be in a private sector final salary pension scheme with 20 years contributions behind me and another 19 ahead if all goes well for retirement at 63. The maximum service contribution is 40 years.
However, the final salary scheme was closed to all new employees 12 years ago, thus there is a fixed number of employees in the final salary scheme of which the number reduces every year by people retiring. We have been made aware that there will come a "tipping point" in the near future where the number of employees left in the scheme will not justify the company paying for them, and the company may take action accordingly.
If this happened within the next couple of years, would my exsisting contributions be "frozen" (so in effect I'd have a fixed number of years into a final salary scheme which would be frozen until my retirement) or would my company be within their rights and able to transfer it into the current scheme offered to employees?.
Is it worth me taking out a supplementary pension now?. I have been given that option by the company I work for and it is basically a stakeholder pension which has been performing terribly, to be honest.
This is my first post in this sub forum so please be gentle, and my knowledge of the ins and outs of pensions is limited, hence my question as follows:
I am lucky enough to be in a private sector final salary pension scheme with 20 years contributions behind me and another 19 ahead if all goes well for retirement at 63. The maximum service contribution is 40 years.
However, the final salary scheme was closed to all new employees 12 years ago, thus there is a fixed number of employees in the final salary scheme of which the number reduces every year by people retiring. We have been made aware that there will come a "tipping point" in the near future where the number of employees left in the scheme will not justify the company paying for them, and the company may take action accordingly.
If this happened within the next couple of years, would my exsisting contributions be "frozen" (so in effect I'd have a fixed number of years into a final salary scheme which would be frozen until my retirement) or would my company be within their rights and able to transfer it into the current scheme offered to employees?.
Is it worth me taking out a supplementary pension now?. I have been given that option by the company I work for and it is basically a stakeholder pension which has been performing terribly, to be honest.
Gents, Thanks for the answers so far, I will go through my paperwork and consult with our pensions dept to see exactly what our "pension promise" is and to establish some facts regarding that.
I will also look into another option of equity tracker funds. However, this is totally new ground to me so any advice would be welcome. FWIW I have an endowment coming out in 2017 worth about £2.78 instead of the £60k (cheers Barclays) it promised, but it'll be a lump of cash I'll need to put to work at the time.
Bottom line is that I was concerned that my contributions could be moved by the Company into a different scheme as they have "control". Incidentally our contributions were recently increased by a fairly sizeable percentage due to recent changes apparently as it became necessary to do so to keep the scheme running (Govt legislation).
If the company does make an offer, just speculating, would it be a blanket offer across the board or done on an individual basis calculated upon years left or service accrued?, as this might benefit some more than others. Or, is it simply unrealistic to try and guess?.
I will also look into another option of equity tracker funds. However, this is totally new ground to me so any advice would be welcome. FWIW I have an endowment coming out in 2017 worth about £2.78 instead of the £60k (cheers Barclays) it promised, but it'll be a lump of cash I'll need to put to work at the time.
Bottom line is that I was concerned that my contributions could be moved by the Company into a different scheme as they have "control". Incidentally our contributions were recently increased by a fairly sizeable percentage due to recent changes apparently as it became necessary to do so to keep the scheme running (Govt legislation).
If the company does make an offer, just speculating, would it be a blanket offer across the board or done on an individual basis calculated upon years left or service accrued?, as this might benefit some more than others. Or, is it simply unrealistic to try and guess?.
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