Pension Fund Contributions

[RandomRando]

Hi good people.

Needing a little advice please.

I work for a company that has a pension fund for its employees (Old Mutual Superfund Pension Fund). When this was first started a few years ago, the deal was that I paid a portion toward the fund (4.5% deducted from my monthly income, shown as a deduction my my payslip) and the company matched this contribution. As far as I'm aware, this is standard practice?

A little while later, the company decided that they would pay for the pension fund themselves and there was no need to have a deduction from the employees monthly income. Naturally i though this was great idea at the time - more monthly income for me! However, i am concerned that this move has lessened the amount being contributed to the fund each month as the company is only paying their share and not including my old share. I am not sure why they chose to change to this new method - most probably something to do with tax implications/benefits.

I envision the scenario as such: If i was paying R50 before, the company equaled that, totaling R100 monthly contribution. Now that they have decided to pay for the pension themselves, they should be paying what would be their normal contribution of R50, as well as my R50 - thus the monthly contribution stays the same, just that the employee does not pay for it?

Before i start potentially making noise about this with HR and finance, i wanted to get some advice/opinions on the matter. In the current setup, should the company be contributing 'my' old contribution as well as theirs? Is this mandatory for them or are the only required to contribute their share @ minimum monthly requirement?

Your input here is appreciated. TIA.

 

[WAslayer]

You bare going about this the wrong way, honestly.. Don't go make 'noise' with HR and finance about it, sounding like you want to get into a boxing match with them.. Instead, go speak with them about it, calmly..

I am surprised that they didn't provide clarity around what exactly the contributions to your pension fund now would amount to, after they made the change.. This is definitely something they should have clearly communicated by providing the facts and associated figures..

Surely you have some sort of access to enquire directly with the pension fund provider about what the current monthly contributions are, be it by calling them or via whatever online portal they may have..

 

[RandomRando]

im not planning on making noise as such, i am just hoping to get details from them about it and ask about the 'secondary contribution' should it be mandatory or not. If it is mandatory, then i would like to go through the processes of getting it rectified. im not at the head office so its not as easy as meeting with the resource dept and having a sit down meeting. (otherwise i would)

I have recently got my statement from old mutual and i see that, after deductions for various fees etc, only 4.5% of my monthly income is being contributed. (before these risk charges etc are charged, its 7%. )

thats why i wanted to find out if that, after the company started paying for the pension directly, if it is mandatory for them to pay my old contribution as well along with theirs?

 

[TofuMofu]

You can just ask them. It should be on your payslip though. I can't see why it won't be on your payslip. It's part of your cost to company salary.

 

[supersunbird]

Hi good people.

Needing a little advice please.

I work for a company that has a pension fund for its employees (Old Mutual Superfund Pension Fund). When this was first started a few years ago, the deal was that I paid a portion toward the fund (4.5% deducted from my monthly income, shown as a deduction my my payslip) and the company matched this contribution. As far as I'm aware, this is standard practice?

A little while later, the company decided that they would pay for the pension fund themselves and there was no need to have a deduction from the employees monthly income. Naturally i though this was great idea at the time - more monthly income for me! However, i am concerned that this move has lessened the amount being contributed to the fund each month as the company is only paying their share and not including my old share. I am not sure why they chose to change to this new method - most probably something to do with tax implications/benefits.

I envision the scenario as such: If i was paying R50 before, the company equaled that, totaling R100 monthly contribution. Now that they have decided to pay for the pension themselves, they should be paying what would be their normal contribution of R50, as well as my R50 - thus the monthly contribution stays the same, just that the employee does not pay for it?

Before i start potentially making noise about this with HR and finance, i wanted to get some advice/opinions on the matter. In the current setup, should the company be contributing 'my' old contribution as well as theirs? Is this mandatory for them or are the only required to contribute their share @ minimum monthly requirement?

Your input here is appreciated. TIA.

While I can't help you with that issue, even contributing 9% (combining them both), that is probably not enough to fund an equivalent income in retirement, one should save at minimum 15% of income for 40 years, more if less years to be able to replace your salary.