An introduction to the TRSP

Tesco Retirement Savings Plan General Education Transcript

Slide [1]. An introduction with Legal & General

Welcome everyone to our webinar about the Tesco Retirement Savings Plan.  My name is Colin Wildman, and I am a Member Communication Consultant at Legal & General. My role today is to help you understand your pension with Tesco. 

This session is designed to be an introduction to the Tesco Retirement Savings Plan, and it will last around 45 mins.

So that you can follow up on any subjects of interest I’ll highlight where you can find out more about each topic during the presentation. All the information covered can also be found in the reward and benefits, retirement savings section of the ourtesco.com website. 

This webinar will be available to watch back on demand using the same link that you used to join today’s event.

There is the facility to ask questions on the BrightTALK platform.  Once I’ve delivered the slides, I’ll use any remaining time to help answer questions.  If I don’t manage to respond to your individual question today, please call the Legal & General customer helpline on 0345 070 0090 - between the hours of 8.30am and 7pm Monday to Friday.

Slide [2]. Important information

Risk warnings:

• This is a general education presentation and does not represent financial advice.
• It’s based on the 2024/2025 tax year.
• The law, tax rates and any allowances may change in the future.
• The value of your investment will go up and down. It isn’t guaranteed, so you may get back less than you put in.

Slide [3]. Agenda: What are we going to cover today?

Today we’ll be focusing on information that will help you to get to know the Tesco Retirement Savings plan. We’ll cover how the scheme works, investing your savings, your options for taking money from your pension and pension transfers. We will also explain how you can manage your pension and use our resources to help to plan your own future.

Slide [4]. Key messages from your employer

The Tesco PLC Pension Scheme is a closed 'defined benefit' scheme. This scheme was available to Tesco colleagues before November 2015.

If you have questions about the Tesco PLC Pension Scheme, please email pensions.dept@tesco.com. We don’t have details of this scheme as it is different to the Tesco Retirement Savings Plan, which is scheme that Legal & General look after. Please be aware that if you do have benefits in the closed scheme, you will get an update of your annual pension amount in your Total Reward Statement each year.

Slide [5]. What is the Legal & General Mastertrust?

The Tesco Retirement Savings Plan is a Legal & General Mastertrust.

A Mastertrust is an umbrella workplace pension scheme that multiple employers participate in. Tesco has its own section in the scheme.

It is managed by an independent Board of Trustees. Members of the Board of Trustees are highly experienced pensions experts who are legally responsible for making all major decisions concerning the efficient delivery of the Mastertrust.

The Trustees work on your behalf to ensure that your pension scheme is properly run and offers value for money. 

For more information. please visit the Mastertrust website.

Slide [6]. How does your pension work?

For some of you, the future may appear to be a long way off. But, whichever lifestage you’re at, saving for retirement is important.

Your pension at Tesco will provide you with a source of income that can help to replace your salary when you want to slow down or stop working altogether.

Let’s have a look at how your pension works.

Slide [7]. Your Defined Contribution (DC) scheme

Contributions are paid into the scheme by both you and Tesco.

You’ll benefit from tax relief on the money you pay in and potentially also savings on NI if using SMART (also known as salary sacrifice).

Your pension savings are then invested with the aim of protecting or increasing the value of your pension pot. Please note that this is not guaranteed, and they can go down in value as well.

Charges are deducted for managing the scheme and the investments.

You can access your pension pot in different ways, which we’ll look at in more detail later, from age 55 (increasing to age 57 from 2028).

Slide [8]. Why save into a workplace pension?

There are short-term and long-term benefits when it comes to saving into your workplace pension:

• You’ll get tax relief from the government on your personal contributions (subject to limitations).
• You’ll receive contributions from Tesco.
• Your pension savings have the opportunity to grow over time.
• You can take your pension pot in different ways.
• The money can be passed on to your loved ones.

Slide [9]. How much State Pension will you get?

For the 2024/2025 tax year, the full State Pension is £221.20 per week or approximately £11,500 per year.

To receive a full State Pension, you need 35 years’ qualifying National Insurance (NI) contributions.  

You must have at least 10 qualifying years of NI contributions to receive any State Pension entitlement. 

As well as paying contributions while working, you can also ‘earn’ qualifying years by receiving NI credits if you’re unemployed, ill, parenting or a carer.  

You can check your State Pension forecast. Go to the gov.uk website or scan the QR code on the slide to see what you might receive and when. 

Your State Pension age will be between 66 and 68 depending on when you were born.

Slide [10]. Saving for the future

The table on the slide details the contribution structure for your scheme and highlights how, as a member of your workplace pension, both you and Tesco are already saving towards your future.

You can choose to save from 4% of your pensionable pay every 4 weeks.

Tesco will match how much you save up to a maximum of 7.5%.

If you want to pay more than 7.5% of your pensionable pay you can, but Tesco will only match your contribution up to 7.5%.

And when you save towards your retirement you benefit from tax relief and National Insurance savings if you pay contributions through SMART (also known as salary sacrifice).

You can change the amount you save into the Plan by changing your contributions in the reward and benefits, retirement savings section of the ourtesco.com website.

Providing you’ve notified Tesco in sufficient time for your request to be processed, your change will be made the next time you’re paid.

If you’re in the Plan and you’re not sure how much you currently pay, you can find out by logging into your online account from ourtesco.com.com without the need for a password.  You can also log in to your online account outside of Tesco at legalandgeneral.com/mya.

Slide [11]. Tax limits on pension savings

If you’re thinking of changing the amount you contribute, you should bear in mind that there is a limit on how much you can pay before incurring a tax charge.

You can normally pay the equivalent of your annual salary into your company pension plan each year and still get tax relief. However, there is an Annual Allowance and if you go beyond this, you may incur a tax penalty. The Annual Allowance is currently £60,000.

This allowance applies across all schemes you belong to, and includes all contributions paid by you or anyone else on your behalf – including your employer.

If you earn more than £200,000, the allowance could be reduced to as little as £10,000 a year. This is called the Tapered Annual Allowance. 

If you start to take money from a Defined Contribution pension pot, the amount you can contribute to your Defined Contribution pensions - and still get tax relief – may reduce.

This is known as the Money Purchase Annual Allowance (MPAA) and, if you trigger it, the amount you can save and still receive tax relief will reduce to £10,000 a year.

The MPAA will not apply if you buy a lifetime annuity, if you only take your tax-free cash or if you take benefits from a defined benefit scheme.

These allowances may change. Our Tax Year Rates and Allowances booklet will keep you up to date on any changes. More detailed information on these allowances is also available on the HMRC website at Gov.uk, which you can access via the QR code on the slide.

If you need help with tax and your pension savings, you may want to seek personalised financial advice. To find an adviser in your local area go to unbiased.co.uk. Advisers normally charge for their services. You can also find out more about choosing a financial adviser on the MoneyHelper website. You can access both of these websites via the QR codes on the slide.

Slide [12]. How much should I be saving?

There isn’t a ‘one size fits all’ answer to this question.

Ideally, you should contribute as much as you can sensibly afford to pay, in line with the income you’ll need to support your plans for later life. We have a range of planning tools that can help you work out how much you might need to support your future lifestyle.

Things to do:

• Review what you’re currently paying in
  • this will help you to work out where you are and what you need to do.
• Set up an annual review in your calendar
  • having a regular review will help to keep your plans on track.
• Increase the amount you’re paying in
  • look for savings in other areas that could help.
  • even small amounts can make a real difference over time.
  • Tesco may increase what they pay if you contribute more.

Slide [13].  Investing your savings

We’re going to take a little time to look at some of the things to consider, when it comes to your savings in this scheme.

Please note, that the purpose of today’s session is to help you to understand your pension and, as such, I’m unable to provide financial advice.

If you want help choosing your own investments, you should speak to a financial adviser. You can find one in your local area at unbiased.co.uk. Financial advisers usually charge for their services.

Slide [14]. How are your pension savings invested?

Your scheme has a default investment option, which we’ll look at in more detail shortly.

A default investment option is a fund or lifestyle profile, into which your pension savings will be invested if you don’t make a different choice. It has been selected by Tesco and the Mastertrust Trustees in conjunction with their advisers.

Although it’s considered a suitable choice for most scheme members, the default investment option doesn’t take into account your personal circumstances or your future plans.

If you want to make your own investment decisions, you can find details of all the investment options that are available to you on your scheme website and or by visiting your online account, where you will also be able to make any changes.

If you’re thinking of making your own investment decisions, you should check whether the fund or lifestyle profile you’re considering matches your own attitude to investment risk and your plans in retirement.

You can also select investments that reflect the way you intend to take your money.

Some of the investment options available will move your pension savings into other funds as you approach your scheme retirement age, but others won’t. It’s important, therefore, to review where your pension savings are currently invested and whether this is in line with your plans.

Please be aware that the value of an investment and any income taken from it is not guaranteed and can go down as well as up, and you may not get back the amount you originally invested. Different funds have different associated risks. Please read the relevant fund documentation before making any investment decisions.

You may also want to take financial advice before making any changes to your investments. You can find a local financial adviser at www.unbiased.co.uk. Financial advisers usually charge for their service.

Slide [15]. Your default investment option: Tesco Lifestyle Cash Option

The default lifestyle profile for your pension scheme is the Tesco Lifestyle Cash Option.

A lifestyle profile is an investment strategy that automatically moves your pension savings, over a period of time, into funds that reflect the way you want to take your money when you get to your selected retirement date, such as taking a regular income or cash lump sums.

The Tesco Lifestyle Cash Option is designed for members who intend to take all of their pension pot as a cash lump sum at their retirement date. It’s an investment strategy that offers you the potential to grow your pension pot in the long term. However, as you get closer to retirement lifestyles that target a cash outcome usually include funds that invest in cash, or short-term money market investments such as bank deposits and Treasury Bills. This aims to provide capital protection with growth in line with short-term interest rates, but this is not guaranteed.

This strategy may not be suitable if you don’t take pension benefits as intended from your retirement date. You should review your retirement date on a regular basis, as it will determine where your pension pot is invested as you approach retirement. This lifestyle profile may not be suitable for you and your individual circumstances and there are other investment options available to you.

For more information, including a more detailed explanation of the aims, please see the lifestyle profile factsheet.

Slide [16]. Default investment option charges:

We are now going to explain the charging structure of the scheme.

There are two types of charges made to your investments.

An annual management charge covers the setting up and running of your pension scheme. This is a percentage of the value of your pension pot.

The fund management charge covers the running of the investment fund and combined with the annual management charge, they make up the total charge.

Here are the current charges for the Tesco Retirement Savings Plan if you invest in the default investment option.

If you decide to invest in a different fund, the charges will change. For more information, please see your online account or follow the on-screen link.

Slide [17]. Taking money from your pension

As a member of a workplace pension, you have the flexibility to choose how you take your money at retirement.

We’ll look at these options in a bit more detail shortly but, before we start, if you’re aged 50 or over, we recommend taking the free guidance that’s available from a Pension Wise specialist to ensure that you understand the available options and the tax implications. 

You may also wish to consider taking financial advice. You can find an adviser in your local area by going to unbiased.co.uk. Please note that advisers normally charge for their services.

Slide [18].  How can you take your money?

The earliest you can currently access your pension savings in this scheme is from the age of 55.

You may be able to access your pension savings earlier than this, if you have an illness that means you’re unable to work again in the future or if you have a protected retirement age.  A protected retirement age was available for certain pension scheme members who, prior to 6 April 2006, had the right to take their pension benefits before age 55.

It’s also worth noting that the government has implemented legislation that will increase the age of access to age 57 from April 2028.

So, how can you take your money?

You can take your money in different ways and can choose the option – or combination of options – that suits your circumstances.

When you access your pension, you can usually take up to 25% of it as a tax-free lump sum.

Your ‘lump sum allowance’ (LSA) is the maximum amount of money you can take as tax-free lump sums from all the pensions you have. While you can still take out money over this allowance, you will need to pay income tax on it.

The lump sum allowance is £268,275. It will be higher if you have any protected tax-free lump sums, or a protected lifetime allowance.

The remaining 75%, however you choose to take it, will be taxed as earned income. The amount of tax you actually pay will depend on your earnings. The money you take from your pension may affect any income-related state benefits you receive.

You can use income drawdown to provide a flexible income.

The first 25% can normally be taken as tax-free cash, subject to any allowances. The remaining 75% you can take as needed.  This is often referred to as flexi access drawdown. You can vary, stop or suspend the amount you are taking any time. Your fund has the chance to grow but it could go down in value too. If you take out too much of your investment or the funds do not perform as well as you would expect you could run out of money before you die.

You can use your pension pot to buy a guaranteed income through the purchase of an annuity.

An annuity gives you a guaranteed amount of money payable for either a fixed term or for the rest of your life. There are different types available which will typically be bought through an insurance company. It’s important to shop around to find a provider and a deal that suits you. If you have certain medical or lifestyle factors such as smoking or high blood pressure, you might qualify for better rates.

You can take your pension pot as cash all in one go. Think carefully before you do this. It could result in a large amount of tax being deducted before we pay you.

You can take cash from your pot in smaller sums. Normally, the first 25% of each cash withdrawal will be tax-free, subject to any allowances. The rest is taxed as income. This may allow you to access your money more tax efficiently. What remains in your pot is still invested and the value of investments may go down as well as up.

You don’t just have to choose one option or one provider. You can choose different options for each pension pot you have. You can transfer all or some of your pension pot to another provider and have your benefits paid by them. However, you may lose your entitlement to any benefits that were protected, such as the ability to combine your defined benefit and defined contributions pots, the ability to access your pot before 55 or a tax-free cash sum greater than 25% of your pot. Please check this before transferring.

You can find more information on the different ways you can access your pension savings at ourtesco.com.com or in the ‘Your options for taking your money’ section of your scheme website.

Slide [19] Money Purchase Annual Allowance

If you start to take money from a Defined Contribution pension pot, the amount you can contribute to your Defined Contribution pensions - and still get tax relief - may reduce. This is known as the Money Purchase Annual Allowance (MPAA). 

You can normally pay the equivalent of your annual salary into your company pension plan each year and still get tax relief. However, there is an Annual Allowance and if you go beyond this, you may incur a tax penalty. The Annual Allowance is currently £60,000. 

This includes any contributions from your employer. But if you trigger the MPAA, this reduces to £10,000 a year (including contributions from your employer).

The MPAA will not apply if you buy a lifetime annuity, if you only take your tax-free cash or if you take benefits from a defined benefit scheme.

You can find out more on the MoneyHelper website, which you can access by scanning the QR code on the slide.

Slide [20]. Make your appointment with Pension Wise

Regardless of the size of your pension pot, if you have a Defined Contribution (DC) pension and you’re aged 50 or over, you’re entitled to free specialist guidance from Pension Wise, part of the government’s MoneyHelper service.

This guidance can help you to understand your retirement options. It will explain how each option is taxed and help you to identify your next steps. It will also provide information on how to avoid pension scams.

Your 60-minute appointment can be carried out over the phone or face to face. You can book your free appointment by calling 0800 138 3944 or by completing the online booking form, which you can access on the Pension Wise website by scanning the QR code. Please note that you’re only allowed one free Pension Wise appointment.

Slide [21]. Helpful resources

We want to help you take control of your money and give you the confidence to plan for the future.

To help you with this, we provide a range of useful tools and resources.

Slide [22] Managing your pension

You can manage your pension savings with Legal & General using your online account.

It’s a bit like ‘internet banking’ for your pension. In the same way most of us manage our bank accounts online these days, you can use your online account to manage your pension savings.

You can access your online account via single sign on (SSO) from ourtesco.com without the need for entering a password].

You can also access your online account by scanning the QR code on the slide.

Once logged in to your account, you’ll be able to

• see the current value of your pension pot and contributions received from you and Tesco.
• use our planning tools to regularly check what your pension pot might be worth at retirement and to work out if you might want to increase your contributions or change your retirement date.
• provide details of who you’d like your pension benefits to go to in the event of your death (nomination of beneficiary).
• manage how your pension savings are invested, including viewing your current fund performance and other investment choices available to you and changing the way your pension savings are invested if needed.
• view your benefit statements and other important documents.
• change your selected retirement date if it no longer reflects your plans.

Slide [23]. The Legal & General App

The Legal & General App gives you everything you need to manage your workplace pension in the palm of your hand!

With complete access to your online account, you can carry out all the tasks we highlighted on the previous slide from your tablet or mobile phone.

If you’ve already registered for your online account, you can log in using the same username and password.

If you haven’t already downloaded it, you can do so from the App StoreOpens in new tab or Google PlayOpens in new tab, which you can access by scanning the QR codes.

Slide [24]. Scheme website

Your pension scheme has its own website which has been conveniently separated out into different stages to help you understand whereabouts you are on your pension journey.

This is where you will find helpful resources including the Member booklet, details of the investment options and information on approaching retirement.  

Slide [25] Care Concierge

Our Care Concierge service is available for free through your scheme website.

Putting care provision in place for a loved one can be a daunting and confusing experience, that could cause significant disruption in your life. Our Care Concierge service can help.

It’s a confidential telephone guidance service which allows you to speak directly to an expert about finding later life care for yourself or a loved one.

They can help you find answers to questions such as:

• What is a Power of Attorney and how do I set one up?
• What type of care is available for my loved one, and how do I find it?
• Are benefits available to me?
• What questions should I be asking care providers?
• How do I access support from my local authority and what help is available?
• How much does care cost and who pays for it?

The friendly and helpful Care Concierge team aim to understand your specific situation and requirements, and help you work out what your options are, at no cost.

You can access as much help as you need and be supported to find the right care, regardless of what type.

Slide [26]. Go&Live

Whether you’re just starting to save, preparing for retirement, or working out how to use your pension pot, we're here to support you.

Our Go&Live website brings together a range of tools and resources to help you manage your money and plan for the future.

It offers information and support on a wide range of topics including financial planning, approaching retirement, and looking after your health and wellbeing.

You can access the homepage of our Go&Live website by scanning the QR code on the slide.

Slide [27]. Getting your pensions into one place

You may have other pensions and want to know if you can transfer them to the Tesco Retirement Savings Plan.

Slide [28]. Consolidating your pensions

There are billions of pounds worth of unclaimed pension savings because people moved house and didn’t inform their previous provider! Could some of that be yours to claim?

If you do nothing else, it’s a good idea to let any previous pension providers know if you have – or are about to – change address.

There are lots of reasons why you might want to transfer an old pension to a different provider. You may want to make it easier to manage your pension savings (by having them all in one place) but it could also be about reducing your charges or improving your investment choices or the options that are available when you want to take your money.  

When it comes to deciding whether transferring your pension savings is right for you, there’s a lot to think about. You might want to start by comparing the charges and available options, to see whether a transfer would be beneficial. You should also check if there are any penalties for transferring out or whether you would lose any guarantees or special features.  

It’s important to be aware of pension scams. You can find out how to spot, avoid and report pension scams at the MoneyHelperOpens in new tab website.

You should also find out if you’re required to seek financial advice, as some schemes (depending on the value of your pot) may require you get a recommendation from a financial adviser. And, even if you aren’t required to do so, you may still want to seek financial advice. 

To find an adviser in your local area go to unbiased.co.uk, which you can access by scanning the QR code on the slide. Advisers normally charge for their services.

Please note, as we outlined at the outset, we’re only providing information in our presentation today. We aren’t able to provide financial advice and, as such, we aren’t recommending that a transfer is the right thing for you.  

You can access My Future Now in your online account.  You can access your online account by scanning the QR code on the slide.

Slide [29]. My Future Now

My Future Now is a pension transfer service that you can access through your online account. It’s a simple way to combine all your pension pots in one place.

Here’s our step-by-step guide to transferring other pensions to Legal & General using My Future Now:

1. Read our guide to pension transfers, to consider whether it’s right for you, before making a decision to transfer.

You might want to such as make it easier to manage your pension savings (by having them all in one place), reduce your charges or improve your investment choices and the options that are available when you want to take your money.  But it’s also important to ensure that there aren’t any penalties for transferring out or that you wouldn’t lose any guarantees or special features.

2. Check that we can accept your transfer.

You’ll need to check the type of pension that you want to transfer, as there are some types of pensions that we can’t accept and others where you’ll be required to take financial advice.

3. Go to your online account, register for My Future Now and submit your request.

You’ll need your National Insurance number, the name of the pension provider and the policy number, if you have it.

Assuming we can accept the transfer, we’ll provide you with a summary checklist and ask you to sign a declaration that authorises Legal & General to make the transfer on your behalf.

4. If you provide the name of your pension provider and policy number.

My Future Now will proceed with your transfer request.

5. If you only provide the name of your pension provider.

My Future Now will trace your pension.  Once it’s been found, you’ll be notified and will then have 5 working days to opt out before it’s transferred automatically.

To find out more about this free service, go to our dedicated My Future Now website which you can access by scanning the QR code on the slide.

Slide [30]. Guidance and advice

It’s important to get the support you need to help you make decisions about your retirement plans.

Slide [31]. The importance of seeking guidance and advice

MoneyHelper is the government body that provides impartial financial guidance and support.

The MoneyHelper website has information about the costs and what you should expect if you decide to pay for financial advice.

Pension Wise is a service from MoneyHelper. It’s a free and impartial service that can help you to understand the ways you can take your pension savings and the potential tax implications of each one.  If you’re aged 50 or over, and you’re considering taking money from a Defined Contribution (DC) pension pot, we recommend that you book your free 60-minute appointment with a Pension Wise specialist who’ll provide you with guidance either face to face or over the phone.

The government also has a mid-life MOT website that provides guidance to help people carry out a financial stock-take some years before their retirement.

If you need personalised financial advice, visit unbiased.co.uk to find financial adviser in your local area. Please note that advisers normally charge for their services.

You can access these websites by scanning the QR codes on the screen.

Slide [32]. Specialist help selected by Tesco

Tesco has reviewed some of the biggest financial advisers in the UK and chosen one that they think is suitable to give advice on the Tesco Retirement Savings Plan – Origen Financial Services. Tesco has also negotiated a competitive rate, so Origen’s advice is likely to cost you less than that from other financial advisers. Visit origenfs.co.uk, call 0800 230 0335 or email TescoPensions@origenfs.co.ukOpens in new tab

If you’re interested in receiving a regular pension income (annuity), for life or for a fixed number of years, you should shop around for the best deal.

Tesco have selected Retirement Line, the UK’s largest pension income broker, to help you with this. Retirement Line believe everyone should know how much guaranteed pension income they could receive, before deciding what to do with their savings at retirement.

Go to retirementline.co.uk/tesco or call 0345 565 2601 to find out more and look for the best option to suit your personal circumstances.

Please note that Tesco is not responsible for any information provided to you by Origen or Retirement Line. Other pension income brokers are also available.

More information is available on the scheme website legalandgeneral.com/tescoOpens in new tab.

Slide [33]. Finding out more

You can find out more about your pension scheme from ourtesco.com or by visiting the scheme website at legalandgeneral.com/tesco.

Slide [34]. Thank you. Any questions?

Before ending the session, let’s take a look at some of the questions we’ve received from the audience today.

It just remains for me to thank everyone for attending our event today. We hope you found it useful.

For further information please see your scheme website or go to your online account.

Our helpline team are also available to support you on the number shown on the slide between the hours of 8.30am and 7pm Monday to Friday. Please note that call charges will vary. We may record and monitor calls.

Thank you.                   

Legal & General WorkSave Mastertrust and Legal & General WorkSave Mastertrust (RAS) are authorised and regulated by The Pensions Regulator.

Administrator: Legal & General Assurance Society Limited. Registered in England and Wales No. 00166055. Registered office: One Coleman Street, London EC2R 5AA.

Legal & General Assurance Society are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. However, the administration of occupational pension schemes is not regulated by the FCA or PRA.