How do you know whether a Master Trust is right for your company?

Handing over management of your finances can feel nerve-wracking - let alone your employees' pension funds

Picture the scene: you’re in the fortunate situation of having some workplace-notemoney to invest. Not being an expert, you know it’s best to enlist professional help.

Even so, your pen hovers over the dotted line.

You feel certain, in your head, that you are entrusting your money to one of the best advisers, and that they will be able to give your investments more time and consideration than you ever will.

Their track record for generating positive returns is stellar.

But it would still feel nerve-wracking, wouldn’t it – the moment when you allow someone else to manage your money?

Every investor has that momentary wobble. It’s only natural.

And not just when it comes to your own money, by the way. In fact, it’s sometimes more so when you’re selecting a provider to manage your employees’ pension funds.

Take this scenario for example.

Last week I shared that The Pensions Regulator had just authorised 35 (now 37) Master Trusts – including, I am still excited to say, our own!

The point of a Master Trust is that it allows you to hand over management of your company’s pension arrangement to experienced trustees.

This has enormous advantages: they can concentrate on the administration of your scheme, allowing you to focus on other important areas of your business.

As pensions experts, they can research opportunities, take well-informed decisions and potentially achieve excellent outcomes for your fund.

There are also potentially economies of scale to be made due to the number of employers participating.

But while you might be thinking, “This makes a lot of sense… This sounds like a good idea in principle”…

There is also likely another voice at the back of your mind, thinking: “...but how do we know one of these Master Trusts is the right solution for us and our employees?”


Great question, and smart of you to ask.

But let me reassure you – from a regulatory and governance standpoint you are in very safe hands, no matter which Master Trust you pick.

Here’s why:workplace-hand-heart

You see, the whole Master Trust authorisation process was designed to ensure that consumers are well-protected, precisely because the regulator recognised that this wasn’t necessarily the case beforehand.

The new vetting process, which took several months and hundreds of pages of documentation and of checks, was as rigorous as could be.

We had to meet very strict criteria to get approval – and it wasn’t easy!

Only trusts with the right systems and processes, safeguards and funds behind them are allowed to operate.

But that was just the beginning!

It’s not as if, once the Master Trusts have got the seal of approval, they can now do whatever they like.

On the contrary actually: the regulator will be supervising them all closely, to ensure the Master Trusts continue to meet the authorisation criteria. They must also meet legal and other obligations, to ensure that any risks are identified and dealt with early.

Once schemes are authorised, they must submit returns, Chair’s statements, annual reports and scheme funder accounts (unless exempt) every single year.

All that to say, you are in good hands, because they’re going to be watching us like hawks 😊

When you entrust your pension scheme to a Master Trust you can quite literally rest assured, knowing it is being well-run.

So while that nervous moment will likely still happen, you’ll be able to confidently let it go and sign the dotted line.

Click here to find out more about our Master Trust and how it could help you achieve better financial outcomes for your team.

And to discuss how our Master Trust could work for your company, drop me an email.

Posted by Steve Butler

Topics: Employee Engagement, master trust, financial wellbeing

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