Explain the
different types of
Pension Schemes:
Occupational
Pensions:
These are
private pension
schemes run by some
employers and are
also known as a
works pension, and
company pension or
superannuation.
Money purchase
pension schemes:
contributions made
by you and your
employer are
invested in the
stock market.
However, share
prices can fall as
well as rise, so if
the stock market
takes a turn for the
worse, your pension
may fall in value.
Personal
pensions: Staff
can take out a
personal pension
under a contract
with a pension
provider and
contribute to it
themselves, and you
can contribute as an
employer too.
Stakeholder
pensions: are a
type of personal
pension.
Your obligations:
If you don't provide
an occupational
pension scheme for
your staff, you may
be required by law
to offer them access
to a stakeholder
pension. There are a
few exceptions to
this. For example,
if you:
- Employ fewer than
five people
- Offer all
employees aged 18 or
over a personal
pension scheme
through which you
contribute an amount
equal to at least
three per cent of
the employees' basic
pay.