You may have heard about auto-enrollment.
Here’s what it is…..
In 1945, for every pensioner there was about 7 people in the workforce. 70 years later in 2015, there are about 2 people in the workforce for every pensioner.
This is putting a strain on the government budget since the state cannot afford to pay all the pensioners since only 2 people are working and paying taxes for every 1 pensioner – a bad ratio!
Coupled with the fact that the average person was not putting enough into their personal pension pot, you’ll now remember when you first heard the phrase ‘ticking time bomb’ – it would have been any financial journalist circa 2010 onwards talking about pensions.
Therefore, the government had to do something and they came up with the (pretty clever) wheeze of shifting the responsibility of pensions from the state to private companies.
So over a number of years there has been a gradual introduction of forcing companies to force employees to pay pension contributions from their salary (or on top of in some cases).
The question is – do you need to do anything about it?
Find out tomorrow!
