The National Employment Savings Trust (NEST)
Employers who don't set up their own automatic enrolment scheme have the option of using NEST.
Who is NEST for?
NEST is a pension scheme primarily aimed at low to medium earners and small employers that don't have access to a company pension scheme.
It's designed to be a simple, low cost option and there are certain restrictions that apply.
- There is currently a general ban on transfers in or out.
- There is currently an upper contribution limit.
- Retirement options are limited to annuity, triviality, or open market option which will result in less choice and flexibility for workers.
- There are limited options at retirement which will result in less choice and flexibility for workers.
- There are limited investment options. Workers will be automatically invested in a default fund based on time to retirement. This will not take into account an individual's attitude to risk.
- The death benefits paid from NEST are potentially subject to inheritance tax.
Last update April 2013
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