An emotional Andy Murray announced that he will be retiring this year due to a hip injury. The news was greeted with dismay by British tennis fans and many fellow professional players, including Roger Federer also expressed their shock and surprise at the news.
Andy Murray may be uncertain as to his future plans but presumably thanks to his past successes, he will not have to worry too much about his finances once he retires. Sadly that is not the case for most of us and saving for our retirement is a necessity.
Since April 2017 it has been mandatory for all existing firms to enrol their staff in the Workplace Pension and ensure that at at least the minimum amounts are being paid into their pension scheme. The current rate is 2% of the annual salary for employers and 3% for staff. By law the total minimum amount of 5% must be paid into the scheme. The employer must make at least the minimum employer contribution with the employee paying the balance but the employer can opt to pay the whole 5% in which case the employee is not obliged to pay anything.
The Pensions Regulator has announced that with effect from 6 April 2019 the total minimum contribution will be increasing to 8%. The minimum employer contribution will rise to 3% and 5% for employees. It is the responsibility of the employer to make sure these increases are implemented and failure to do so may result in a fine.
April may still seem a while away but employers need to be looking at this now to ensure that everything is in place before the increase takes effect. The ball is in their court and employers need to get set to match the new contributions.