When by law millions of workers were put into pensions for the first time as a result of auto-enrolment, NOW Pensions are one of the new providers that entered the market. Their philosophy is to offer value for money and simplicity to their customers. To develop this approach, they worked in collaboration with Danish company ATP, one of the largest pension funds in Europe.Is NOW different to other pensions?
NOW is pretty much the same as most other pensions. It’s a money purchase pension (also called defined contribution) whereby you pay in and the government adds tax relief on top for you. Great news! For auto-enrolment your employer must also pay into your plan and that’s essentially free money. What you get back when you retire depends on how much has been paid in and how well NOW funds have grown your money.
NOW’s a bit different to other pension schemes. It has a board of trustees who look after your interests as members, including the administration and investment matters as well as meeting the legislative and regulatory requirements. This appeals to employers who don’t want to do these tasks for themselves.
The fees NOW charges are slightly different to other pensions. There’s a monthly admin fee of £1.50 on your plan and your savings incur an annual fee of 0.3%. It’s not possible to continue to pay into your plan yourself if you leave your employer, unlike a personal pension.
Can I opt out of NOW pensions?
Yes, you can. When you are auto-enrolled or later on whenever you like, even to take a short break. If you do opt out then after 3 years your employer must auto-enrol you into the pension once again, but you can still opt to leave, even for a short time. Think carefully though there’s free money on the table and that’s always worth having!
How does NOW compare with Nest and The People’s Pension?
All 3 came into being to run auto-enrolment workplace pensions for millions of people. So, you’ll not be surprised to know that their pensions are very similar to each other in terms of what they offer you. The fees you are charged are broadly similar as are the type of investment funds you can choose. The support you receive for your pension plan is focused these days online.
