Coronavirus (Covid-19) - an update from the Nestlé Pensions team
The coronavirus outbreak means that individuals and companies need to change the way they work. As a result, the Nestlé Pensions team, along with many other teams around the UK, has moved to home working to try and limit the spread of the coronavirus.
We have introduced measures that ensure the safety of the team and their families, but which also ensure we can continue to deliver the services you need. However, these measures do affect the team’s ability to respond to telephone calls.
Therefore, if you have questions about your pension, or changes to report in your circumstances, please contact the team by email (firstname.lastname@example.org) where possible.
You can also continue to contact the team in writing at:
1 City Place
While the pensions team expects to be able to continue to perform most tasks, and is working hard to process requests as normal, please understand that there may be delays in responding to your requests.
Pension fund investments
You may have heard about the falls in stock markets and the uncertainties surrounding investments in the media recently – it’s likely that this uncertainty will continue for a while.
However, in these times we need to remember that saving for retirement is long term. We have seen falls in stock markets and uncertainty before, and we will no doubt see it again. It’s therefore important that you pause to think before taking any immediate action when it comes to your retirement savings.
Please read the information below that relates to the section of the Fund you are in (if you’re unsure about what section you’re in, you can find out on your payslip or by logging in to your account).
DB Core/DB CorePlus
If you are building up pension in a ‘defined benefit’ (DB) scheme like DB Core or DB CorePlus, your benefits don’t depend on what happens in the stock markets. The Trustees have put in place an investment strategy that helps protect the Fund’s investments from periods of volatility such as the one we’re experiencing at the moment.
If you are paying additional voluntary contributions, or if you’re paying contributions to DC Core on your earnings above the earnings cap, please read the DC Core section below.
DC Core/DC Start
In a ‘defined contribution’ (DC) scheme like DC Core or DC Start, you and Nestlé both pay into an individual pension savings account. This account is then invested with the aim of growing its value (through investment returns). When you reach retirement, you can choose how to use the money in your account. The size of your account will depend on how much you and Nestlé pay in, and how your investments have performed over time.
The recent stock market falls have negatively impacted many of the funds in DC Core and DC Start.
If you are a long way from retirement, there is time for your investments to recover. By continuing to pay into your account, you will continue to benefit from Nestlé’s contributions and from the tax and National Insurance relief that applies to your pension contributions.
If you are closer to retirement and invested in the Lifetime Pathway fund (the default investment arrangement), your investments switch to lower risk investment funds as you approach your target retirement age. This switch begins 15 years from your target retirement age and in the five years before you reach your target retirement age, your investments start to switch into cash.
If you are a DC Start member, your account can only be invested in the Lifetime Pathway fund.
It’s important to keep your target retirement age updated as this is the age we use to work out when your investments will start to move into lower-risk funds if you’re invested in the Lifetime Pathway fund. If your target retirement age isn’t in line with your plans for the future, there’s a risk that your investments could start to move into lower-risk funds too early or too late.
Find out more about the Lifetime Pathway fund and how it works.
We would urge you not to make hasty decisions when it comes to your DC savings account. Instead, please consider your circumstances carefully and speak to an independent financial adviser if you are unsure of what action to take.
To find an independent financial adviser, visit www.unbiased.co.uk