Below you will find Frequently Asked Questions about Kingfisher Pension Scheme – Money Purchase (KPS-MP).
The Trustees, along with the Company’s support, decided to appoint Legal & General (“L & G”) (in place of Zurich) as their new pension provider. Members are now enjoying a much lower Annual Management Charge and more access to financial education and retirement planning tools.
If you have MPS benefits only you will receive an annual benefit statement from L & G this year. The format will have changed and the statement period will be from the transition date to 31 March 2018. Your account will include all the contributions paid into your account over the scheme year and the total value of your account as at 31 March 2018.
If you want to check your current level of contributions, please look at your current payslip. The matching Company contributions are shown below.
|YOU WISH TO PAY||THE COMPANY WILL PAY||TOTAL PAYMENT|
|8% or more||14%||22%|
To help people save more for their retirement, in 2012 the Government introduced a law that all UK
companies must automatically enrol eligible workers into a workplace pension. Minimum contributions were set for both employees and employers.
From April 2018, the minimum contribution level for KPS increased from 1% of your basic pay to 3% of your basic pay. The Company contribution increased from 2% to 3%.
In April 2019, the government is raising these minimum contribution rates again. There will be further information available early next year.
In this year’s statement the section headed “What your pension might be worth at retirement” shows what your pension could look like at your retirement age.
L & G has taken the value of your pension pot at the end of the statement period and calculated what it might be worth when you reach your retirement age. This is based on your current level of contributions ie the contributions that you were paying as at 1 March 2018 and any potential investment growth.
Pension companies use different assumptions to measure investment growth.
The options will show your estimated pension pot and the tax free cash and pension you might be able to buy with the cash left over in your estimated pot after taking the tax free cash. You have other options on retirement and you can find further information on the www.legalandgeneral.com/kingfisher website.
KPS MPS does not provide this option and you would need to transfer your account to another provider.
Legal & General provide a product called a “Mastertrust” from which drawdown is available. If you would like to transfer to the Legal & General Mastertrust or would like more information about this option, you can go to www.legalandgeneral.com/pensionaccess for further details.
We would recommend that you take financial advice and/or speak to Pension Wise which is a free and impartial service backed by the government who will help you make sure that the decisions you’re making are the right ones for you. Pension Wise will help with MPS benefits only.
Broadly speaking, any death benefits payable depend on whether you are a contributing member of the Kingfisher Pension Scheme (KPS) Money Purchase (MP) section and whether you are still employed by the Company.
The death-in-service lump sum payable is four times your salary if you are a contributing member of the KPS-MP, and one or two times salary if you are not (dependent on when you joined the Company). For employees who joined the Company on or before 30 June 2012, it is 2 x their contractual Salary as at their date of death. For employees who joined the Company from 1 July 2012, it is 1 x their contractual Salary as at their date of death.
The value of your pension pot would also be payable subject to HMRC limits.
If you are no longer employed by the Company a death-in-service lump sum is no longer payable. The value of your pension pot would be payable subject to HMRC limits.
Please remember to keep your Beneficiary Form up-to-date so the Trustee can consider paying any lump sum death benefit payable to the person(s) nominated. You can download a copy of the form at www.legalandgeneral.com/kingfisher
You can see where your funds are invested by looking at the “Where your pension pot was invested” section of your benefit statement.
This section details which fund or funds your pension pot is currently invested in. It also provides you with a pie chart which visually represents how your money is split in percentage terms between each fund.
If you have not made any active investment decisions, then you will be invested in the Lifestyle Cash Target.
A Lifestyle Option will automatically move your pension savings into lower-risk funds as you head towards your Selected Retirement Age.
There’s a lot to think about when it comes to making your own investment decisions. You can find out more about the different types of investments and other things you need to think about when making your investment choices in your Member Booklet.
You can switch your existing fund value or redirect future contributions by going online www.legalandgeneral.com/kingfisher and clicking on the Manage My Account links.
To change the amount you contribute, you will need to complete and return the Change of Contribution Form to Group Pensions.
As a money purchase member, your pension will increase depending on what you choose when purchasing your annuity (or pension).
For more information about annuities please refer to our ‘Annuities Explained’ Module.
If you are a final salary member, your pension will be increased in line with the Retail Price Index up to a maximum of 5% each year. You will receive confirmation from the Trustee when your pension is increased.
You will receive a leaver options letter from Legal & General after leaving the scheme (please allow 6 weeks). This will confirm all the options available to you in terms of your Retirement Account.
Please note if you are 55 or above, you may be able to claim your benefits early, however if you are below this age you will not be able to settle your benefits.
Yes, if you are an active member of the KPS-MP, you should be able to do this.
The Transferring in Benefits page on our website should advise you what you need to do, however if you would like to discuss this further please contact Legal & General on 0345 0264 179
As the KPS-FS closed to future accrual on 30 June 2012, your built up benefits will be calculated as at that date. The calculation is based on your final pensionable salary and the number of pensionable service years as at 30 June 2012. This benefit will then be increased each year by the Retail Price Index up to a maximum of 5%.
Your KPS-MP benefits is not impacted by the length of service you have had with the Scheme. Your KPS-MP benefits is impacted by the amount you contribute into the your Retirement Account and also any investment returns you receive.
If you choose to retire before your Scheme’s Normal Retirement Date, then your KPS-FS benefits will be reduced to take into account that you will be taking your benefits before your Normal Retirement Date.
If you would like further information please contact us at Group Pensions and we’ll be happy to provide you with information.
If you are aged 55 or over you have the following options with regards to your Retirement Account:
- Take all of your Retirement Benefits as a one off cash sum, with 25% being tax free and the remainder taxed at your marginal rate of income tax. This is called an “Uncrystallised Fund Pension Lump Sum” or “UFPLS” for short. Or “Small Pot Lump Sum” if all your benefits in the Scheme has a value of £10,000 or less. (Please note: by taking all your pensions savings as a one off taxable lump sum, you may be subject to a reduced Money Purchase Annual Allowance).
- Use your Retirement Account to buy an annuity, which is a pension paid by an insurance company.
- Take 25% of your Retirement Account as a tax-free lump sum and use the balance of your Retirement Account to buy an annuity.
For full details please click here.
Please see the Investment Section under KPS-MP, form and Guides.
Please click on the Blue LOGIN box on the right of the screen and select Legal & General. This will take you to Legal & General’s dedicated site for our scheme. You will then be able to register / login to manage your Retirement Account.
There is no age limit to when you have to stop being a member of the Money Purchase Scheme. The main condition is that you are still employed by the Company.
So you can continue to contribute until you leave the Company or you may retire from the KPS-MP and continue to work for the Company as well. The choice is yours.
We do recommend you review your Selected Retirement Age, as this may impact your investment strategy should you choose to remain in the Lifestyle Cash Target (The default investment option). The Scheme’s default Selected Retirement Age is currently 65, however if this is not suitable for you, we recommend you review and change where necessary.
Information about how you can change your investment strategy can be located here. Moreover by providing your Selected Retirement Age, it means Legal & General will contact you at the correct date rather than an earlier date which may not be applicable to you.
If you are off work due to illness and not receiving any pay, no contributions will be made to the Scheme either by you or your employer. When you return to work contributions will start again.
In the meantime any contributions that you have already made will continue to be invested in the Scheme.
No, the KPS-MP provides retirement benefits & death benefits. Full Details can be found under the KPS-MP Member Guide.
In the event of your death whilst still employed by the Company, a lump sum of 4 X Salary at date of death would be payable.
If you choose to opt-out of the KPS-MP, your death in service cover will reduce from four times salary to two times salary if you joined the Company before 30 June 2012 or one times salary if you joined the Company after 1 July 2012.
See click here for more information.
Being in the KPS-MP means you’ve taken an important step towards giving yourself the lifestyle you might like later in life. You may want to start thinking about things you will need money for in retirement, such as paying bills, transport and buying food, and the things you may also want to do, such as
- run a car
- meet friends for lunch or drinks
- go on days out/holiday
- do sport or other leisure activities
Once you have an estimate of how much you can expect to receive from your pension, you can think about whether it will be enough. Why not use the Pension Planner to give you an idea of what your KPS-MP may provide on retirement. If you’re concerned you will not have enough, you could think about contributing more to your Retirement Account, working longer, and/or saving in other ways. By law neither the Trustee, your employer or Legal & General can advise you, you may therefore wish to seek Independent advice.
SMART Pensions is an alternative way in which you can contribute to the KPS-MP.
Most active members will begin to pay their contributions via this method once they have been in the Scheme for three months.
For more information please refer to the SMART Pensions Guide.
Yes, you may change your investments at any time and as often as you wish to the range of funds the KPS-MP offers, full details of which can be found in the Scheme’s member guide. Each fund has its own characteristics, risk levels and annual management charges.
By law neither the Trustee, your employer or Legal & General can advise you on your investment choices. You may therefore wish to seek Independent advice.
There are a number of benefits:-
- Tax efficient way of saving for your retirement as you will receive tax relief on the contribution you make into the KPS-MP.
- Your employer also makes a contribution into your Retirement Account.
- You can make your own investment choices from the range of funds on offer.
- As an actively contributing member of the KPS-MP your Death in Service cover will increase to 4 x salary
- The KPS-MP is set up as a trust which means that all the money held within the KPS-MP is completely separate from Company finances.
As an active member of the KPS-MP you need to notify your Payroll department in writing of your wish to “cease membership”. Payroll will cease your contributions and notify Legal & General accordingly. In turn Legal & General will provide you with full details of your leaver options.
Please click here to see the leaving options.
Please note as an active member of the KPS-MP your death in service benefit equals 4 x Salary at date of death, however once you withdrew/leave the Scheme this reduces to 2 x Salary if you joined the Company before 30 June 2012 or 1 x Salary if you joined on/after the 1 July 2012.
Please also note in accordance with the Automatic Enrolment legislation, the Company may be required to automatically enrol you into the KPS-MP however you do retain the right to opt out. Please see Do I qualify? for further information.