Introduction to Pensions

This page will explain about the different types of pension schemes, including occupational schemes like the Kingfisher Pension Scheme, and how they work with the State Pension.

Watch our short video

Types of Pensions


An Introduction to Pensions leaflet and presentation

Understanding the BasicsKPS-MP
The Kingfisher Pension Scheme – Money Purchase Section.

The Kingfisher Pension Scheme – Final Salary Section.

Linked KPS-FS and KPS-MP Pension
Benefits within both the Final Salary and Money Purchase sections of the Kingfisher Pension Scheme.

A retirement income.

Occupation or Company Pension
A pension provided by your employer.

Defined benefits or final salary
A scheme in which the benefits are defined in the scheme rules and accrue independently of the contributions payable and investment returns. Most commonly, the benefits are related to members’ earnings when leaving the scheme or retiring, and the length of pensionable service.

Also known as ‘final salary’ or ‘salary-related’ scheme.

Defined contribution or money purchase
A scheme in which a member’s benefits are determined by the value of the pension fund at retirement. The fund, in turn, is determined by the contributions paid into it in respect of that member, and any investment returns.

Also known as ‘money purchase’ scheme.

Automatic Enrolment
Legislation requires Companies to automatically enroll employees into a pension scheme which meets certain criteria.

Personal Pension
A pension provided by an insurance company taken out by yourself.

Additional Voluntary Contribution (AVC)
Extra contributions paid into a pension arrangement.

A series of payments, which may be subject to increases, made at stated intervals until the end of the agreed period or the life of the annuitant. This is often achieved by means of an insurance policy underpinned by guarantees.

Retirement Account or pot
An account in your own name into which contributions are paid to be invested until retirement.