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Tesco Pension

Started by taliahad, 23-06-19, 08:04AM

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taliahad

I do not understand pensions at all.  I just wondered what everyone else thinks of the Tesco pension.  I'm currently paying in 15% of my wages into it, am I wasting my money? 

Ssdd

15% I thought you could only go between 4 and 7.5?

lucgeo

I was always of the belief that you could save as much as you wanted, but Tesco would only contribute up to 7.5 to match your 7.5  ???
Live for today. Learn from yesterday.

taliahad

You can put `00% in if you like but as said above, tesco will only put in 7.5%. 

tick tock

Tesco will only match upto 7.5%.
Ie you put in 5% tesco puts in 5%
you put in 6.5% tesco puts in 6.5%.
So this goes upto 7.5%.
You put in 0% tesco puts in 0%

Hammer10

If you can afford it but 7.5% is all Tesco will match .

Nattienat

You can save as much as you can afford,  Tesco will only put in a max 7.5% .


taliahad

I understand how it works, I understand what Tesco will pay in.   My question is, is it worth me putting as much as possible into the pension, or do people think that I'd be better off putting the money elsewhere?  What do others think of the Tesco pension plan?

tick tock

Quote from: taliahad on 23-06-19, 12:53PM
I understand how it works, I understand what Tesco will pay in.   My question is, is it worth me putting as much as possible into the pension, or do people think that I'd be better off putting the money elsewhere?  What do others think of the Tesco pension plan?
money is invested into the stock market and this will determine any losses and gains over the years.
Really I would decline to give financial advice.
Maybe go and see a pension advisor and explain that you have a defined contribution pension and would like advice.
They have to follow code of conduct.
You may be charged for his time.
Hope this helps in some way.

Walker

For me it's a no-brainer up to 7.5% contributions since with Tesco matching your contributions plus tax benefits and very low fees it's a great deal.

After 7.5% it's still very tax efficient and low cost so it's not a bad choice or a 'waste of money' but most GA and team manager's are probably going to want to invest in things where they can get their money back before they retire.


his scots tie

Pension is nowhere near as good as the one that tosco closed in 2015,once again shafting its hard working staff, and costing them literally thousands of pounds each.

Charlie Harper

I pay 15% into mine...Tesco match 7.5%. It seems an OK pension to me, obviously I'd like Tesco to match a higher % like they do for Senior Team but hey ho.

So easy to increase/decrease the % you pay in each month via the colleague room.

Fo the final month of the last tax year I increased mine to 80% for that 1 month only. (I didn't really need the money at the time)  :P

NightAndDay

#12
As far as I'm aware, the pension scheme is the same across the board (probably except for executive directors and the c-suites), Tesco vacancies for positions such as Store Manager, Government Relations Manager and Software Development Manager all offer the 4-7.5% defined benefit contribution pension scheme.

Tescos pension scheme is ok, but low wages doesn't add much to it. When I was an SL, contributing 5%, I averaged £77.86 S.M.A.R.T contributions (I don't know if that's my contribution or both, mine and Tescos.) In my current job, I pay 4% they pay 6%, it ends up with total contributions of about £350 a month.

StoreManager

Have been in the pension for just over a decade. Don't want anything to do the pension now. Can I remove all my contributions as lump sum?

NightAndDay

You can transfer your pension out to another scheme, but you will lose money from it, It's best just to take it as an annuity or a percentage as a tax free lump sum when you do retire.

lucgeo

The new pension scheme came into affect 2015 and the old one frozen. You can apply to take your pension out aged 55 or over. They won't give the full sum to you and you should have received your pension forecast earlier this year which explained your options.

Personally, I withdrew all of my old pension pot, late 2017, I was granted the full amount and paid tax on 75% of it, but I did get a tax rebate at the end of the tax year, admittedly not the full amount. 

It was right for me, it enabled me to upgrade my home and remain mortgage free. The house has increased in value in the last 18 months at a higher % than the pension pot was offering.

The new one, even though I was contributing the 7.5 match to 15%, has now stopped for me since being made redundant. The amount in it is a pittance, but I will hang on to it for now, to see if it's worth transferring to a new employer pension fund.
Live for today. Learn from yesterday.

Pro123

I have changed my contributions a few times. Currently I pay in 17% excluding the Tesco contribution. I am about to shift the value (I'm keeping £100 in to continue current  contributions) to a stakeholder scheme to give me more fund choice but still within L&G. I pay in 17% as its done at source from my wages and I can forget about it. I also pay in maximum into BAYE.

lackofinterest

Quote from: lucgeo on 23-06-19, 06:07PM
The new pension scheme came into affect 2015 and the old one frozen. You can apply to take your pension out aged 55 or over. They won't give the full sum to you and you should have received your pension forecast earlier this year which explained your options.

Personally, I withdrew all of my old pension pot, late 2017, I was granted the full amount and paid tax on 75% of it, but I did get a tax rebate at the end of the tax year, admittedly not the full amount. 

It was right for me, it enabled me to upgrade my home and remain mortgage free. The house has increased in value in the last 18 months at a higher % than the pension pot was offering.

The new one, even though I was contributing the 7.5 match to 15%, has now stopped for me since being made redundant. The amount in it is a pittance, but I will hang on to it for now, to see if it's worth transferring to a new employer pension fund.
Hi lucgeo. did you pay the high tax or normal on the 75%.  I ask because I'm thinking of doing the same.

lucgeo

#18
Pretty sure it was 20%, e mail the pensions dept, giving your employee number,D.O.B. and N.I. Number....they will tell you the figures and whether they will release the full amount....they don't with everyone, suspect it may be an age thing and if the amount is in excess of their ceiling figure for needing to obtain independent financial advice??
Live for today. Learn from yesterday.

gomezz

It also depends op your personal circumstances.  As someone near state retirement age but with a decent pension from a former employer I have decided it is better to pocket a bird in the hand now rather than a bird in the bush later.
"The progress of the kart is more important than its direction"

Charlie Harper

Quote from: NightAndDay on 23-06-19, 04:45PM
As far as I'm aware, the pension scheme is the same across the board (probably except for executive directors and the c-suites), Tesco vacancies for positions such as Store Manager, Government Relations Manager and Software Development Manager all offer the 4-7.5% defined benefit contribution pension scheme.


I'm sure I read on here a while back that the deal for Senior team was different/better. A quick search threw up this page on it

https://www.thisismoney.co.uk/money/markets/article-3217202/Supermarket-Tesco-tells-staff-end-final-salary-pension-scheme.html

Like I said, I'm sure I read it on here too but couldn't find that info

NightAndDay

Hmmm interesting, vacancies on the Tesco careers website for WL 3+ positions offer the 4%-7.5% pension, this means one of 2 things, either Tesco reduced it to the 4%-7.5% scheme for everybody, or the senior team is classed as WL4+ colleagues (I'm guessing Superstore SM's, Superstore AMs, directors and above.)

Charlie Harper

Quote from: gomezz on 23-06-19, 09:48PM
It also depends op your personal circumstances.  As someone near state retirement age but with a decent pension from a former employer I have decided it is better to pocket a bird in the hand now rather than a bird in the bush later.

How do you mean Gomezz??? I'd have thought for someone nearing retirement age, or even nearing the age at which the new pension could be pulled (55), that makes it a no brainer.

I mean, if you were say 50, (with a decent pension in place elsewhere) you could throw in the 7.5% for 5 years knowing that over that time you'll be at least doubling your investment (with the Tesco match up) and have the peace of mind that the money could then be pulled at the end of the 5 years (when you hit 55) if you so wished.

More so, treat it as a long term savings plan, not a pension.

gomezz

#23
As far as I know the employer's contributions to your pension pot cannot be cashed in as you suggest.  And your own contributions if cashed in are then subject to income tax the same as if they had been part of your pay originally.  So no real advantage to bothering with it.
"The progress of the kart is more important than its direction"

Charlie Harper

#24
When you pull it, or 'cash in', then you can do with the whole pot as you please, just like any other pension.

Once Tesco have made a contribution each month, then that's the end of their involvement/influence. That money is then yours. (even though you can't touch it until 55+)

What you've said rings true with the old pension, but does not apply with the new L & G one.

Your point about tax is true, but that rule is the same with any pension income regardless of it's source.




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