IMI employment expert Sally–Anne Hodder
If your employer has less than 30 staff, you will have the opportunity from January 2016 to April 2017 depending on your staging date. Your employer must inform you if this is the case. You don't have to join but if you choose to opt out, you may miss out on either a cash bonus when you retire or an enhanced income for the rest of your life
The scheme is very flexible, in most cases you will be able to choose how much you save. There is currently a minimum contribution of 1% of your salary, but you can save even more if you choose to. The best bit is that your boss must also make a contribution; currently this is a minimum of 1% which, if you are paying the minimum, is doubling your savings each month.
The Government also contributes to your fund by way of tax relief on your contribution, so it's win win. These minimum contributions are set to rise gradually until Oct 2018 when the minimum contribution will be 8% of which your employer must contribute at least 3%. If you choose to opt out of the scheme you won’t get any of this extra cash from your employer or the Government
The type of pension scheme you're offered will depend on your own employer - but whether it's a defined benefit or defined contribution scheme the chances are you will end up with more money when you come to retire, compared to using other saving methods.
When you retire you can get your pension as a regular income or you may be able to take a tax-free lump sum.
Some of you may think that putting even the minimum amount into a pension will cause you financial problems; times are tough so that may well be true. It's important to remember though that the contribution you make will reduce your take home pay and may qualify you for an in-work benefit, in which case you won’t lose out at all.
If you're between 22 and retirement age, and earning more that £10,000 year, check this government website and see how you can claim your right to a workplace pension.
Visit gov.uk/workplacepensions
If you have a comment on this or any other employment issue please email randr@theimi.org.uk.