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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 money purchase scheme?
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What is a money purchase scheme?
This Factsheet takes a detailed look at money purchase schemes – which are being introduced by more and more employers, and are now playing an increasingly important role in employees’ pension planning. If your scheme is money purchase, it is essential that you learn how your scheme works, and what it can – and can’t – do for you.
A ‘money purchase scheme’ provides benefits based upon the amount of money that is in YOUR own pension ‘pot’ when benefits are due to be paid.
The amount in YOUR ‘pot’ at retirement will depend upon how much was put in by your employer and by YOU, the investment returns achieved on those contributions, and any costs which are charged against your growing ‘pot’.
The benefits you or your dependents will get from a money purchase scheme will come entirely from your ‘pot’.
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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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