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MyCompanyPension.co.uk - Helping members of occupational pension schemes to better understand their benefits.
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:: Scheme Member | Types of Pension Scheme | What is a defined benefit scheme with a money purchase underpin?
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What is a defined benefit scheme with a money purchase underpin?
We take a detailed look at a variation of a defined benefit scheme. Even though there is an element of the pension benefit which is money purchase (i.e. an ‘underpin’), because a defined benefit scheme provides a ‘promise’ to the emerging pension, schemes with a ‘money purchase underpin’ are still regulated as defined benefit schemes.
A defined benefit scheme with a money purchase underpin provides you with two alternative pension options from the same pension scheme. You will get the better of:
- a ‘defined benefit’ element of the pension scheme
- a ‘money purchase’ element of the pension scheme
You will not receive two pension benefits: just the better pension from one of the two alternatives.
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To find out more, choose one of our free Factsheets on the right to match your category of membership.
Not sure which category of member you are? See our definitions:
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See our Glossary for definitions of phrases in our Factsheets
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This Factsheet is not applicable to members of Money Purchase schemes
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