Typical Employer Pension Contribution

I'll upset you all, but the highest I have seen is matching AVC 1:1 up to 100%. This was before there were limits and it was not broadcast to the general staff.
 
14% with my employer (if you pay 6%), definitely an element of golden handcuffs..

The 14% was set more than 10 years ago and was done at a time of getting last few people out of some legacy DB schemes, the plan was to reduce it over time but I reckon I'm about the only person left who remembers that particular plan.. suits me in my current position to continue as is..

Years ago I worked in a part of an employee benefits company, company introduced flex benefits, I was surprised that almost everyone u worked with gave up the generous company contribution for a small increase in salary which would be Taxed. All clever well qualified people but mostly young so pension wasn't their focus
 
We have 5% match, more generous on bonuses though, 25% cash bonuses and 30% RSU vesting over three years. Just need to make an AVC the next year when you sell the shares.
 
Cameo said:
I was surprised that almost everyone u worked with gave up the generous company contribution for a small increase in salary which would be Taxed.
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When one company my husband worked with changed from DB to DC, most of the company contribution to the scheme could be taken as salary for members who were already in the scheme. The younger employees also preferred the cash. I must say it was at the time that annuity was a rule for DC pensions which didn't suit everyone.
 
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shipship said:
Is it standard that the employer contribution is a % of salary rather than salary+ bonus or TC.
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Traditionally, yes it is only on basic salary. However, the Pension AE Employer's contribution is based on Revenue's definition of 'Gross Pay'. This is all pay including BIKs, Taxable Allowances and before Salary Sacrifices etc. As things stand, this is were the fun will start with Pension AE. When a company pension scheme is not the equivalent or better than AE, stage 2 of AE will auto enroll Employees on hybrid rate to make up the difference.
The above are DSP's current plans, unless there is political meddling.
 
US MNC I am with offers 8% standard with no employee contribution. For each 2% the employee contributes, they will add another 1%, until the employer contribution gets to a max of 12%.

A significant minority of employees do not make the 8% employee contribution to get the extra 4% employer match.
 
CharlieMac said:
Who knows where the corporate tax take will be in 20 years time and if we find anything to replace that tax income with at a time of likely growing demographic imbalances. Better to also have other sources of retirement income if possible.
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The last time the state was strapped for cash, it wasted no time dipping into DC pension funds. I fear the same will happen to both DC and ARF funds should it feel the pinch again.
 
MrEarl said:
Perhaps so, though the state will have some reserves built up, if ever it gets into trouble again.
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Remember the National Pension Reserve Fund? It got hoovered up along the way to pay the debts. Such was our government's overextension at the time it barely made a dent.

The bit about the pension fund tax being used for "Job Creation" annoyed me I couldn't see a direct link between the tax and any job. I suspect it got used for day to day spending.

I agree that AE should reduce this kind of shenanigans in future but there's not a huge amount of difference at the end of the day for DC owners between reducing the COAP or taxing their DC.
 
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