‘Free money’ and more
OK there’s a catch, but the catch is that you have to start saving towards your future!
We all like to think we’ll have more freedom in retirement. It’s a chance to tick things off our bucket list, spend more time with family and have the flexibility to make the most of our time.
But it’s worth planning ahead so you can afford the comfortable retirement you might be aiming for. Now that we’re living longer, we have even more time to plan for. This means that many of us will need to put more money aside while we work.
There are many great reasons why you might want to start saving for your future.
‘Free money’ from Nestlé
Tax relief from the Government
Protection for your loved ones
Invested for long-term growth
'Free money' from Nestlé
Nestlé rewards you for saving into a pension savings account – and, along with tax relief, the amount that goes into your account can build up quickly.
If you’re a DC Core member, for every £100 you contribute into your pension savings account (up to 8% of your pensionable earnings), Nestlé pays in up to £150 on top of that
Money in your pension savings account (monthly).
And this quickly builds up...
So saving at this rate, over a year you'll have saved £3000
But, including tax-relief, you’ll only have paid £816 from your salary.
Your contributions receive tax relief
Paying into a pension is a really tax-efficient way of saving for your future. Because contributions are taken from your salary before you're taxed, it only costs you £80 to save £100 into your pension if you pay tax at the basic rate. And if you pay through salary sacrifice, you'll make national insurance savings too.
To see more examples of how much contributions actually cost you and how much Nestlé pays, see Pensions and tax
Cost to you
(monthly)
Money, including Nestlé’s contributions, in your pensions savings account (monthly)
You pay £100 into your pension savings account but it only costs you £72 because you'll pay less National Insurance (£8) and tax (£20). Based on if you pay tax at the basic rate.
Protection for you and your loved ones
No-one wants to think about their own mortality, but it’s comforting to know that if you become too ill to work or you die, you and your loved ones may receive the following benefits.
If you get ill
If you’re too ill to carry on working, the Fund offers ill-health retirement benefits.
If you die while working
- a lump sum of 6 x your pensionable earnings in the past 12 months; plus
- the value of your DC account as a tax-free lump sum.
- a lump sum of 2 x your pensionable earnings in the past 12 months; plus
- the value of your DC account as a tax-free lump sum.
Remember to complete a Nomination Form
The Trustees will have discretion to decide who to make lump sum payments to. To help the Trustees do this, make sure you keep your Nomination Form up to date.
Your savings are invested
When you pay into your pension, it isn’t just locked away. Instead, it’s put to work and invested for your future. We do this, not just because it makes sense to try and grow the value of your pension pot, but because we know it’s likely that the cost of living will be higher when you come to retire. Investing your savings with the aim of growth means they’ve got the best chance of meeting the higher cost of living in the future.
If you join DC Core, you can choose which investment funds your savings are invested in, or if you’d prefer, we’ll automatically invest your money in the Lifetime Pathway. In the Lifetime Pathway fund, your savings are gradually switched to more stable investments as you get closer to your selected retirement date. This means you should benefit from investment growth while you’re younger and protect the value of your savings when you get closer to retirement.
For more information on how investing works, including the charges you’ll pay, see How DC investing works