What is Automatic Enrolment?
The government has introduced a new law to make it easier for people to save for their retirement. It requires all employers to enrol their workers into a qualifying workplace scheme if they are not already in one.
At present, many workers fail to take up valuable pension benefits because they do not make an application to join their employer's scheme. Automatic enrolment is meant to overcome this.
How Does Auto-Enrolment affect me?
Employers have to automatically enrol workers who:
- Are not already in a qualifying workplace pension scheme;
- Are at least 22 years old;
- Are below state pension age;
- Earn more than the current tax threshold
- Work or ordinarily work in the UK (under their contract)
However, even if you do not qualify to be automatically enrolled, you still have the right to join the scheme. If you tell your employer that you would like to opt in to the scheme, they must allow you to do so.
When is this happening?
Although automatic enrolment came in from 1 October 2012, individual employers duties will be introduced gradually over the following six years,and will be based on the employer's size.
There will be a maximum three month waiting period before your employer must enrol you; however, if you are aged between 16 and 75 years and want to start saving straight away, you will be able to opt into the scheme.
Invest Southwest are an award winning Independent Financial Advisers that offer pension advice . We are FCA approved and offer a free initial consultation to establish your needs.
If we can help with any of your needs do not hesitate to contact us on 01934 310653