Pension started without consent

[bulldog5046]

Just wondered if this has happene to anyone else?

Last day or two I've received letters from the pension company saying its been approved and what my payments will be etc.

This was some what of a shock to me as I intentionally did not return the pension request form I was sent.

I'm guessing it should eb simple enough to get called off as I never signed or gave consent to any of it?

Just not sure why HR felt possessed to publish an application without me signing anything or even stating how much to invest!

Ry

[CurvaParabolica]

I'm guessing your referring to pension contribution at work? Have you just started? If so check what your cover letter/contract says. Ours say that new employees are automatically enrolled into the pension scheme at the default amounts unless you return the membership/opt-out form. This is because benefits such as Death in Service and Accident Insurance differs if you're in the scheme or not, so better to have it then not.

[bulldog5046]

Thanks for pointing me in some direction.

I've justchecked my employment contract and there is no mention of auto-enrolement, it says details will be provided on joining.

The form they sent me (which i still have here) has no mention of a way to opt-out which is why i simply didn't return it.

Seems a bit strange to me, i presume under these circumstances any money taken will be returned?

[northandy]

Tell them you dont want to be in it, you will get your contibutions back.

Auto enrollment is becoming more popular, in fact is it becoming mandatory soon?

[ewenm]

northandy said:

Tell them you dont want to be in it, you will get your contibutions back.

Auto enrollment is becoming more popular, in fact is it becoming mandatory soon?

I work on a big payroll system and this is the case. All new hires are automatically enrolled in the Pension Scheme and if they wish to opt-out any funds taken so far are refunded. And yes, with pension reform coming up (especially public sector) this auto-enrolment will become increasingly common.

[bulldog5046]

Good to know, Thanks for the advice guys!

[OneDs]

Just to close the loop, the new proposals are that they will keep auto-enrolling periodically (every 12 mths) and you will have to retrospectively after you've been enrolled each time tell your employer you don't want to be in it.

[The Leaper]

Auto enrollment is starting to be introduced by law from October 2012. The legislation requires that employees will be automatically enrolled unless they positively opt out. There's no reason why employers cannot operate auto enrollment now. The contract of employment will need to spell out the details, process etc.

R.

[northandy]

OneDs said:

Just to close the loop, the new proposals are that they will keep auto-enrolling periodically (every 12 mths) and you will have to retrospectively after you've been enrolled each time tell your employer you don't want to be in it.

Thats going to be fun where i work, 250 employees but very few are in the pension scheme.

[ewenm]

northandy said:

Thats going to be fun where i work, 250 employees but very few are in the pension scheme.

The system I work on at the moment has got over 70,000 employees across several pension schemes plus those who have opted out/not eligible. Then you have casual employees - will they be eligible? We've got the detailed proposals but they prompt more questions than they answer

Keeps me in a contract I guess but could well be expensive to implement for every employer.

[bulldog5046]

Spot on guys, thank you again.

Spoke with them today and they explained as said above and i sent them an email stating i wished to opt-out.

seems a bit odd to force the hand though? is it to reduce the number of people claiming state pensions?

if i had just left it they would of been taking £100/month from me which seems an awful lot to me? but i guess its 5% minimum input isnt it?

[ewenm]

bulldog5046 said:

seems a bit odd to force the hand though? is it to reduce the number of people claiming state pensions?

The idea is to get more people saving for retirement by making it an active decision not to save. It means those who don't care either way will have a pension rather than not. Whether that pension is actually any good is another matter of course.

[bulldog5046]

I've been somewhat putoff pension schemes, it seems the government and employer benefit but the employee is a loser really, i guess thats not much of a suprise aye?

Something that concerned me a year or so ago was that the IT manager at the place i was at the time found out his pension rached some maximum and that he had to continue to pay into it but would never see the money? i believe it went to the government to cover state pensions?

the facts are, i'm 23 and really dont know what to do, i like the idea of just putting money in an ISA i can get at any time but i also could die tomorrow so why not live life a day at a time and worry about it later?

ideally, obviously, i'd like to be a millionaire by the time i'm 30 so a pension shouldnt really be an issue

[mph1977]

ewenm said:

bulldog5046 said:

seems a bit odd to force the hand though? is it to reduce the number of people claiming state pensions?

The idea is to get more people saving for retirement by making it an active decision not to save. It means those who don't care either way will have a pension rather than not. Whether that pension is actually any good is another matter of course.

I think this is the case ...

it's very easy in your teens or early twenties not to worry about retirement - yet in a 'funded' scheme it's these earlier and smaller payments that would provide the bulk of final pension with 30 + years to grow ... even in the 'unfunded' PS schemes early entry is valuable becasue of accrual based on service.

if you leave it until your 30s and 40s to worry about a pension you've missed the boat.

[mph1977]

bulldog5046 said:

I've been somewhat putoff pension schemes, it seems the government and employer benefit but the employee is a loser really, i guess thats not much of a suprise aye?

Something that concerned me a year or so ago was that the IT manager at the place i was at the time found out his pension rached some maximum and that he had to continue to pay into it but would never see the money? i believe it went to the government to cover state pensions?

the facts are, i'm 23 and really dont know what to do, i like the idea of just putting money in an ISA i can get at any time but i also could die tomorrow so why not live life a day at a time and worry about it later?

ideally, obviously, i'd like to be a millionaire by the time i'm 30 so a pension shouldnt really be an issue

there's a life time 'limit' for pension pots but iirc it's a couple of million quid - above that you get taxed quite seriously

some schemes if you don't retire when you reach max accrual you continue paying in for little or no gain

[northandy]

bulldog5046 said:

I've been somewhat putoff pension schemes, it seems the government and employer benefit but the employee is a loser really, i guess thats not much of a suprise aye?

Something that concerned me a year or so ago was that the IT manager at the place i was at the time found out his pension rached some maximum and that he had to continue to pay into it but would never see the money? i believe it went to the government to cover state pensions?

the facts are, i'm 23 and really dont know what to do, i like the idea of just putting money in an ISA i can get at any time but i also could die tomorrow so why not live life a day at a time and worry about it later?

ideally, obviously, i'd like to be a millionaire by the time i'm 30 so a pension shouldnt really be an issue

That was probably a final salary scheme, where he paid an amount in but accrued a 1/60th of his final pay per year of service, once you have reached 40/60th's you dont gain any extra pension. But obviously your final salary gets higher each year. If i was at that point i would have been retiring!

[ewenm]

bulldog5046 said:

I've been somewhat putoff pension schemes, it seems the government and employer benefit but the employee is a loser really, i guess thats not much of a suprise aye?

Something that concerned me a year or so ago was that the IT manager at the place i was at the time found out his pension rached some maximum and that he had to continue to pay into it but would never see the money? i believe it went to the government to cover state pensions?

the facts are, i'm 23 and really dont know what to do, i like the idea of just putting money in an ISA i can get at any time but i also could die tomorrow so why not live life a day at a time and worry about it later?

ideally, obviously, i'd like to be a millionaire by the time i'm 30 so a pension shouldnt really be an issue

It all depends on the terms of your scheme. For example, if you put £x into the pension every month does your employer match it? Or do they put a fixed amount in every month or nothing at all? My advice would be to speak to a financial advisor about your options - your employer's scheme could turn out to be really good! If you do speak to an IFA, make sure you take the details of your employer's scheme with you