Group Personal Pensions
A Group Personal Pension plan is essentially a group of retirement plans which are available for a group of employees, and are usually provided by their employers.
The advantage of having a Group Personal Pension plan instead of simply a personal one is that you will often pay less in fees, as the money is invested together which incurs lower charges.
To become part of a GPP you must open a PPP within that group.
A Personal Pension Plan is available to all UK residents under the age of 75 and on the surface works in much the same way as any other pension plan.
The saver will pay contributions each month into the fund, which is pooled together with the money of everyone else in the group, and then invested. The pension provider will manage the money and decide which funds the pension is invested in on your behalf.
The provider is able to invest in nearly all asset classes available in the UK and overseas, including stocks, shares and commercial property.
It’s worth noting that there are no guarantees, and that pension funds can lose money as well as gain money. The fund will most likely have a level of risk associated with it, so savers willing to take a higher risk on their pension open themselves up to the possibility of large gains, as well as large losses.
Savers tend to become more careful with their money as they approach retirement, as they can’t afford to lose it. Savers will often opt for safer investments like cash or government bonds as they near retirement, rather than the high risk overseas investments others look to invest in.
One of the biggest advantages of investing in a group is that a larger pot of money often offers more power than your own individual fund. With a large pot of money, the fund manager will have more investment opportunities available, giving you the best chance of saving the most you possibly can for retirement.