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Auto-enrolment for nanny - which scheme?

(17 Posts)
Anstey Thu 09-Mar-17 22:22:46

I'm starting to look at pension schemes for my nanny. From what I've read, nest is the bottom end of the market and free to join, but with limited benefits. There are so many others to choose from, and with various fees from one off joining fee to monthly admin fees for life - I'm struggling to narrow down the field - what companies are other nanny employers planning on signing up with?

Anstey Thu 09-Mar-17 22:24:02

I'm starting to look at auto-enrolment for my nanny. From what I've read, nest is the bottom end of the market and free to join, but with limited benefits. There are so many others to choose from, and with various fees from one off joining fee to monthly admin fees for life - I'm struggling to narrow down the field - what companies are other nanny employers planning on signing up with?

Chippednailvarnishing Thu 09-Mar-17 22:26:27

I'm currently doing this for my employer. I decided to avoid nest, they take 1.8% of contributions as a charge and you can't transfer to other providers.
The peoples pension looked ok and cheap for the employer.

nannynick Fri 10-Mar-17 06:45:54

You need to look at the charges of each of the various providers and also check that they will take a small employer.

All will have various charges on investment funds, so your nanny will have some of their investment reduced by charges.

You will need to do various letters to your nanny and keep checking they qualify for auto-enrolment. Some pension providers and some nanny payroll companies help with that.

Who are the pension providers you are currently considering?
NOW: Pensions used to accept small employers but I think their costs went up a lot in the past year or so.

nannynick Fri 10-Mar-17 09:09:07

As a nanny my employer uses NEST and I prefer it to my existing personal pension as I can top it up whenever I like. I expect all new pensions are like that, as they can be managed online.

SMART Pensions seems to be free, so wondering how the company behind that makes money. Need to read the small print I expect to find where the charges are - probably on the fund in some way.

Ta1kinPeace Fri 10-Mar-17 12:19:16

Avoid NOW like the plague

NEST is fine and the fees are the same as most other places when you drill down

nannynick Fri 10-Mar-17 12:32:46

Ta1kinPease have you heard of SMART? Any idea how they make money if they don't charge employer or employee?

Ta1kinPeace Fri 10-Mar-17 12:40:28

nanny
there will be hidden dealing fees - same with all financial products

nannynick Fri 10-Mar-17 12:44:55

Thanks, that is what I imagined, the fees must be hidden in the management of the pension.

Sunseed Fri 10-Mar-17 17:05:23

From an employer's point of view, The People's Pension can be beneficial because there is the single set up charge to pay but then that's it. All the on-going costs are paid for by a 0.5% annual deduction from each employee's account. And the employee has an individual relationship with The People's Pension so that if they leave your employ it is really easy for them to take the pot with them - they don't need to involve you in communications.

Ta1kinPeace Fri 10-Mar-17 17:07:50

same as NEST then
except that NEST is free to set up for the employer

user1476194084 Fri 10-Mar-17 19:41:07

Just a word of advice - you are not a qualified financial advisor so you cannot give advice - I was advised by our advisor to go with Nest as it is the government default and if you go for anything else you have to do a full financial disclosure or risk your employee being able to prosecute for not doing so!! We went for nest

Ta1kinPeace Fri 10-Mar-17 20:16:08

No shit sherlock
I'm an anonymous posting ID
but the points I make can be checked on their websites

user1476194084 Fri 10-Mar-17 21:35:06

Sorry that was the genuine advice I received - I normally just browse the threads but though I could actually help someone - forgive me for trying to be helpful. I auto enrolled 20 people in my company and only wanted to help - now I know why I usually only look - nice way to treat a new poster

Ta1kinPeace Sat 11-Mar-17 16:52:36

User
Nest as it is the government default and if you go for anything else you have to do a full financial disclosure or risk your employee being able to prosecute for not doing so
You were mis advised.

Anstey Sun 12-Mar-17 08:56:09

There is definitely plenty of scope for confusion, and cost.

My nanny was enrolled with the people's pension when she used to work for a nursery, so she would like to stay with them, but £500+vat as a set up cost is expensive, even if it isn't recurrent. I had a quick look at standard life and aviva but they charge almost £500 a year in rolling management fees alone, which would be more than I would be putting in the pension a year, so that doesn't make sense to pursue!

I am signed up with nanny tax, but they are not an IFA so won't suggest one product over another.

Nest sounds good in theory, but I've read that it's not the best portfolio, understandable as it is free, but that is a bit of a disincentive.

People's pension will reduce their fee to £300+vat if you are referred by an IFA, or other advisory body, so I may try and track someone down to recommend them and bite the bullet.

nannynick Sun 12-Mar-17 09:18:07

Nest have different portfolios in it and your employee gets to choose which one they invest in and can change it. So it is up to your employer which portfolio they invest in, not you. You are just providing access to a range (admittedly quite limited) of portfolios.
You aren't giving them investment advice, you are providing access to a scheme which may or may not be suitable for them and they can decide if they wish to join that, or opt out.

Your duty is to provide a scheme, not to provide a scheme which you guarantee will be a good investment - as no one can predict the future.

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