How to provide financial support to staff
Aside from in-house bonus schemes, gifting birthdays as a paid holiday and other discretionary benefits, it is compulsory for employers to auto-enrol staff into a company pension scheme.
There are some boxes to tick. Each employee must have a contract, earn a specific amount per week, month or year and be at least 22 years of age.
Each month, around 5% of an employee’s qualifying earnings will be automatically paid into the pension with an additional amount of around 3% paid in by the employer. It’s easy and makes sense.
If your company doesn’t run a workplace pension scheme the government-backed National Employment Savings Trust (NEST) provides an alternative.
A professional financial advisor will talk you through the options available because many pension schemes benefit the company as well as the employee so long as they are implemented correctly and compliantly.
I have worked for various Companies over my career and had amassed many pensions from various providers. It was a mess, but Becky sorted everything out for me. She made a complicated and confusing subject really easy to understand and gave me complete peace of mind. I was confident with her advice in consolidating my pensions and appointing a fund manager.
What does a salary exchange mean?
A salary exchange offers benefits to employees as well as employers. To explain it in a nutshell, an employee will take less money in their pay packet in exchange for a non-monetary benefit. As a result, the employee will pay less in tax and National Insurance contributions (NIC) and the employer will also save on NICs and PAYE payments.
How do final salary transfers and pension consolidations work?
A final salary transfer is a way to unlock a pension pot early by calculating what’s called a cash equivalent transfer value. Employees might consider this option if they wish to retire early or need to access their money. Allowing staff to talk to a professional financial advisor through your company will help them to assess the pros and cons.
A pension consolidation is a way to pull all pension assets into one place. Many employees aren’t aware that they have multiple pensions, especially if they change jobs frequently or have left old schemes. As an employer you can help your staff to find forgotten savings and consolidate everything into one pot.
If you are an employer, talk to Willow Financial Solutions about the best way improve your staff benefits