A pension scheme gives you a good way to build up benefits that will provide you with an income or a lump sum in retirement. Pension schemes are often a better way to save than just putting money into a savings account, because you receive:
- Contributions from the Co-op
- Help from the government in the form of tax relief
- National insurance savings by contributing through NICE Pensions.
These benefits are explained in more detail below:
Contributions from the Co-op
The Co-op makes contributions to Pace DC and the amount will depend on how much you pay.
|You pay (% of Pay)
||The Co-op pays (% of Pay)
||Total (% of Pay)
* Please note that the 1% contribution rate will not be available from 2018, and the 2% contribution rate will not be available from 2019. This is because of Government rules which require contribution rates to gradually increase. If you are paying a rate that is being discontinued, you would automatically be moved up to the next contribution rate.
Help from the government
Contributions to all pension schemes receive tax relief from the government (subject to certain limits). This means that your contributions towards your pension cost you less. The pension guide for members of Pace Complete provides further information.
Higher-rate tax payers
The amount of tax relief that you receive depends on the rate of tax you pay. If you pay higher-rate tax, you will receive tax relief at the higher rate. If you pay additional rate tax (i.e. earn over £150,000), you may also be able to claim tax relief at your highest rate.
Contributions to Pace are also made through NICE Pensions, which is a more cost effective way of saving for your retirement. This means that you would make additional National Insurance savings, so contributions cost even less. Find out more in the 'NICE Pensions' section.