Retirement Savings Plan (Pension) April 2016
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Where to find things Introduction .................................................................................................................................................................... 3 1.
Who’s this policy for?......................................................................................................................................... 3
2.
Who is eligible? ................................................................................................................................................... 3
3.
What is the Tesco Retirement Savings Plan? .................................................................................................. 3
4.
What do I need to do?......................................................................................................................................... 3 a)
Choose how much to save.............................................................................................................................. 3
b)
Complete an Expression of Wish form ......................................................................................................... 3
c)
Decide if you want to Opt out ....................................................................................................................... 3
d)
Look at how your Savings are invested ....................................................................................................... 3
5.
When can I take my Savings?............................................................................................................................ 3
6.
How can I take my Savings?.............................................................................................................................. 4 a)
All as cash ........................................................................................................................................................ 4
b)
A bit at a time (drawdown) ............................................................................................................................ 4
c)
As a regular guaranteed income (pension) .................................................................................................. 4
7.
What if I am too ill to continue working at Tesco? ......................................................................................... 4 a) Colleagues who only have paid into the Tesco Retirement Savings Plan (new starters from November 2015) ...................................................................................................................................................... 4 b)
Members of the old scheme and the Tesco Retirement Savings Plan ...................................................... 4
8.
What death benefits are provided? .................................................................................................................. 4
9.
Where can I find out information about the closed scheme? ........................................................................ 4
10.
Useful contacts ............................................................................................................................................... 4
Policy info .................................................................................................................................................................... 5 Policy owner:............................................................................................................................................................... 5 Ownership and confidentiality ................................................................................................................................. 5
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Introduction We offer a savings plan called The Tesco Retirement Savings Plan to all Tesco colleagues to help them save for the future.
1. Who’s this policy for? This policy is for anyone that has joined the Tesco Retirement Savings Plan either as a new starter or has been transferred into the Plan from the old pension scheme provided by Tesco. This policy is a summary of the new Plan; for more information please visit thecolleagueroom.com.
2. Who is eligible? We provide a Plan which permanent or temporary, full or part-time colleagues can join. You can join from any age, no matter how long you’ve worked here or how much you earn. If you’re aged between 22 and 75, you’ll automatically join the Tesco Retirement Savings Plan within three months of starting work. We’ll write to you to let you know when this will happen and how to opt out if you want to. If you're not eligible to join automatically or you’d like to become a member straight away, then you can apply to join at any time by completing the Application to Join Form on the colleague room.
3. What is the Tesco Retirement Savings Plan? The Tesco Retirement Savings Plan is a long-term savings plan provided by Legal and General. You do not pay tax or NI on the money you save into the Plan so it is an efficient way of saving for the future. Tesco also pays into your account to increase the savings you make. Your savings are invested to help them grow over your working life, until you choose to take them. You can currently do this from age 55. When you decide to take your savings, you can usually take up to a 25% of the value of your savings as a taxfree lump sum. You can decide how to take what’s left in a way that suits you. You may opt out of the Savings Plan at any time.
4. What do I need to do? a) Choose how much to save If you have automatically been enrolled into the Plan then you need to choose how much you want to save. You can save from 4% to 7.5% of your pre-tax pay into the Plan, and Tesco will match what is saved, up to 7.5% of your pay.
You can boost your savings by choosing to pay more than 7.5% of your pay by going to thecolleagueroom.com.
b) Complete an Expression of Wish form It’s important to prepare for all eventualities so you should complete an Expression of Wish form so that the Savings Plan Trustees know who to pay money to should you die unexpectedly. This should be updated whenever your circumstances change as it can cause great distress to your dependents in the event of your death. You can download a form through thecolleagueroom.com
c) Decide if you want to Opt out If you really don’t want to be part of the Tesco Retirement Savings Plan once you've been automatically enrolled, you have one month to opt out and get back any payments you've made (if you're under age 75). To do this please log into thecolleagueroom.com.
d)
Look at how your Savings are invested
How you invest your savings can make a big difference to how much money you have in retirement. Tesco Lifestyle Investment Options are available to you to choose from, depending on how you want to take your savings. There are 8 different investment options to choose from. To make it simple for you, your Tesco savings will be automatically invested into the Tesco Lifestyle Cash Option and it will assume you'll want to take your savings all as cash when you retire. If you want to stay in this option you don't have to do anything. The Tesco Lifestyle Options have been designed specifically for Tesco colleagues to be low cost and to help maximise returns and minimise risk. The different types of investment options are available to all colleagues and you can change your investment option at any point. Please visit the thecolleagueroom.com to read more about the options available to you which reflect a range of different ethical and religious principles. The Tesco Lifestyle Investment Options assume that you want to start taking your savings at age 65. If you invest in the Tesco Lifestyle Investment Options and think the age when you want to take your savings will be earlier or later than age 65, it’s important that you tell Legal & General as early as possible to make sure your money is invested appropriately. You can change your target retirement age at any time by calling 0345 070 1113.
5. When can I take my Savings? You can take your savings at any point from the age of 55 and you can still continuing to work for Tesco if you wish.
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As a default we assume that you won’t take your savings until the age of 65. Although many people choose to take their savings when they retire, you don’t have to do so. It is up to you when you retire, although the minimum retirement age in the UK is currently age 55, although this may increase in future.
6. How can I take my Savings? a) All as cash
7. What if I am too ill to continue working at Tesco? a) Colleagues who only have paid into the Tesco Retirement Savings Plan (new starters from November 2015) If you are a member to the Retirement Savings Plan and you become too ill to continue working, then you should notify your People Manager. You will have to contact Legal & General to see if you are eligible to have your Savings refunded to you.
You can take your savings as cash either all in one go or as a number of payments. Each of these cash payments will be free of tax on the first 25% and the remainder will be subject to your rate of income tax.
b) Members of the old scheme and the Tesco Retirement Savings Plan You may be eligible for a limited ill-health pension.
Please note that you should consider carefully how much to take and when to take it as this may affect the amount of tax and National Insurance you will pay. The Tesco Lifestyle Cash Option automatically assumes colleagues will take their money as cash and will invest colleagues’ money with this in mind. If you do not want to take your savings as cash, please contact us as soon as possible and at least five years before you want to start taking your savings.
b) A bit at a time (drawdown) You might decide that you want to take your savings a bit at a time on a regular basis once you start drawing your savings. If you decide to do this, you will be able to take 25% of each lump sum tax-free with the remaining 75% of each lump sum subject to your marginal rate of income tax. The rest of your savings will remain invested until you choose to take further lump sums. If you want to take your savings in this way then we can invest your savings in line with the Tesco Lifestyle Drawdown Option. In the five years before your normal pension age the Tesco Lifestyle Drawdown Option will leave more of your savings invested in funds that are more likely to give you a better return than if they were invested just in cash. You should let us know at least five years before the age you want to start taking your savings, if you wish to use this option.
c) As a regular guaranteed income (pension) If you decide to do this, you will be able to take 25% of your savings as tax-free lump sum when you start drawing your savings, and convert the rest of your savings into a regular income by buying an annuity from an insurance company.
This is based on the pension that you have built up in the closed scheme and won’t be reduced for early payment before normal pension age. To be eligible you would need to be certified by a GP as being unable to do your current job at Tesco and for there to be no suitable alternative employment at Tesco available to you. The pension trustees will then consider whether you will be awarded an ill health pension. You will also be able to get your savings from the Retirement Savings Plan refunded to you.
8. What death benefits are provided? If you were to die while saving into the Plan, life cover of five times your pay plus the total value of your retirement savings will be paid to the person you nominate in your Expression of Wish form.
9. Where can I find out information about the closed scheme? Information about our closed Pension Scheme can be found on pensionwebsite.co.uk. The login details for this are: Username: tesco Password: mypension
10. Useful contacts Tesco Retirement Savings Plan Support Team call centre. Call Centres will not be open on Sundays, Public Bank Holidays or the Saturday prior to a Public Bank Holiday. Opening Hours:
9-6 Monday to Friday and 9-12 Saturday.
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Telephone Number:
0345 070 1113
Tesco Retirement Savings Plan website address: www.thecolleagueroom.com
Policy info Version No.
Date of change
Summary of change
1
25th April 2016
New policy
Policy owner:
[email protected] Ownership and confidentiality This document shouldn’t be shared with anyone externally without permission from your Director. This policy and any associated documentation remains the property of Tesco and should be returned if requested.
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