Two cars stand in your driveway.

They both have 4 wheels. They will both get you to your destination. They both have enough room to fit your family. And you can play your favourite music on both cars’ stereos, at full volume should you so desire, for your entire journey.

It sounds like there’s not much to choose between, right?

The (perhaps predictable) catch is that one is a brand-new BMW and one is a beaten up old Skoda.

Your choice of car will make a great deal of difference to the quality of your journey – and how you feel when you get to your destination….

Picking the right Master Trust is a bit like that.

In a few months’ time, all Master Trusts on the market will be authorised by the Pensions Regulator. Those that are allowed to continue operating will all have been audited and will all have the regulator’s stamp of approval.

So looking in from the outside, you might imagine that they’re all much of a muchness, and that it doesn’t make a great deal of difference which one you pick.

In reality, whilst you know they are all financially sound and that they will have good governance, there will be big differences between them that will affect the outcomes you achieve for your employees.

Here are some of the questions you should consider, when picking a Master Trust:



Do they help you engage your employees around pensions?


A good Master Trust is about a lot more than managing your investment – it fulfils the basic responsibilities a company has towards its employees, when it comes to pensions.

Getting them engaged with pensions is one example. Consider looking for a Master Trust that doesn’t just send out dry, technical updates to employees in order to fulfil its duty, but that will engage your employees in exciting and innovative ways.

Does it, for example, use the newest tools such as video for pensions comms? Do they segment their campaigns properly, or send all your employees the same boring pieces of information? What other technology does it offer, to help your employees save more, and manage their savings?

What is its investment proposition? That said, its investment strategy is an important consideration for you.


Just like two wealth managers are unlikely to recommend the exact same tactics, the Master Trusts you are considering are unlikely to be investing or managing your funds in the exact same way.

Some basic points to consider: Are the assets actively allocated? What proportion is actively managed? How broad is the diversification of assets? Is beating inflation one of the trust’s goals?

Two financially sound trusts can deliver very different results for your scheme’s members…


What support do they offer your employees as they approach retirement?


A good Master Trust will help employees make the most of the funds they are accumulating.

What facilities does it have, to answer their questions in the years before retirement? What advice and guidance is available – do members, for example, have access to a financial advisor?

Make sure that your employees are given the right journey as they approach retirement, not left to their own devices to make financial mistakes at the very last moment.


How does HR stay up-to-date with the scheme management?



Even though you have outsourced the administration of the scheme, you need to receive regular reports about how it is functioning. How are these reports going to be delivered? Does the Master Trust have the right technological interface to make it easy and efficient for you to stay up-to-date?

Ultimately, you need to make sure that the Master Trust you appoint is going to add value to your pensions proposition and run your pension even more efficiently and with even more success than you already are.

See it not just as a chance to reduce the burden on you, but to offer your staff a world-class pensions provision – benefiting from economies of scale and a dedicated set of trustees – in an easy, cost-effective way for your company.

If that’s something that is of interest, we have a Master Trust which can not only deliver excellent outcomes for your members…

But gives them access to a unique online tool which helps them manage their savings…

Comes with an outstanding, innovative comms package…

Offers them access to the advice and information they need to make the most of their savings….

And dramatically reduces the burden on you.

Check it out here.

Posted by Steve Butler

Topics: Pension Investment, AVC Master Trust


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