Defined Benefit
What is a Defined Benefit pension?
A defined benefit (DB) pension scheme is one where the amount you’re paid is based on how many years you’ve been a member of the employer’s scheme and the salary you’ve earned when you leave or retire.
Based on salary rather than investment
What is a Defined Contribution pension?
This can be either a workplace pension or a personal pension. This provides retirement benefits which are based on how much an individual (and their employer) puts into the scheme, plus the return on those investments, and any charges applied.
What does HMRC stand for?
Her Majesties Revenue & Customs
True or false
I can transfer my pension straight into my bank?
False- Pensions can be transferred to other pension arrangements or claimed through current
What system would I use to find out if a document has been received from the member to us?
Sharepoint
True or False
Defined benefit pension will give me a guaranteed income for life?
True - DB scheme will pay you until you pass away
True or false
The employee/member bears the risk and the cost of a DC pension?
True - The member bears all the risk on their individual investment
What does IFA stand for?
Independent Financial Adviser
True or false
Transfer values can only go up and do not go down?
False- Transfer values fluctuate and are based on current expectations for future economic and demographic experience
What system would I use when a member calls in to leave a call note and book a job?
Either TML or IDVR system
What is the difference between final salary and CARE?
Final salary is based on the members highest salary from the last three years of employment and CARE is is based on your career average.
CARE - Career Average Revalued Earnings
True or false
A DC pension can provide me with income for life?
True- By purchasing an Annuity with a DC pension you can request a guaranteed income for life
What does AVC stand for?
Additional Voluntary Contributions
What documents do we need on file in order for us to speak to a RS (Receiving scheme)?
We need either a signed LOA from the member (Letter of Authority) Or the RS discharge form.
There is no TML or IDVR record to book a job or leave my call note - What system should I use?
Bizflow
What are the main two options when claiming a DB pension?
Option One - An annual pension (payable for life)
Option Two - 25% TFC (Tax free cash) and a reduced annual pension (payable for life)
Who Regulates Pension Schemes?
The Pensions Regulator is the regulatory body for work-based pension schemes in the UK. A work-based pension scheme is any scheme that an employer makes available to employees.
What does CETV Stand for?
Cash Equivalent Transfer Value
How long is a DB transfer value guaranteed for?
They are guaranteed for 3 months
I need to check if there is an ongoing retirement job for the member. Which system should I use?
Bizflow
What is Trivial Commutation?
If the member is over 55 and total of ALL of their pensions (DB, DC, in payment, not yet taken) is under £30,000 then they will have the option to take all of these pensions as lump sums.
What is another term used to define a DC pension?
Money purchase pension
What does SPA stand for?
State Pension Age
When would a member need to seek financial advice before doing a transfer?
A member would legally need to seek financial advice if pension TV (Transfer value) was over 30k
Member wants to know how much he got paid this month and his tax. Which system should I use?
Open