The Aspire Savings Trust joins the line-up of authorised master trusts
Our Master Trust has been granted authorisation by The Pensions Regulator
Remember this from your 20s?
You’re hosting a party… And for the first few minutes, no one turns up.
You pace around nervously, wondering whether you are going to be exposed as Billy-no-mates.
Then the first guest walks through the door, clutching a bottle of wine (or several beers)….
…and before you know it, the whole room is full of people having a great time.
Those nerve-wracking first few minutes are the calm before the storm.
And that’s how the pensions industry feels right now.
The storm on the horizon (and let me be clear, I’m using ‘storm’ only in the sense of something big and exciting happening – nothing negative!) concerns Master Trusts.
Under a Master Trust arrangement, each employer has their own section within a larger scheme overseen by a single board of trustees.
A couple of years ago, there were around 90 operating in the UK. Many did a great job for their members, and proved popular because they’re a highly efficient way for employers to offer a well-run pension arrangement, whilst shifting the responsibility for governance on to professional trustees.
But others were too small to operate effectively and consumers were not always as well-protected as they could be.
That’s why The Pensions Regulator has required all Master Trusts that want to continue operating to go through a very rigorous authorisation process.
It checked that the people running the scheme are fit and proper; that the scheme is financially sustainable and has adequate systems and processes; and that the scheme has a continuity strategy.
And over the last few weeks, it has authorised 35 of the 39 Master Trusts that applied for official accreditation1 – including, I am delighted to announce, our own!
Personally, this feels like reaching the end of a marathon. The submission took our team months of intensive work to put together, and then it was several more tense months until we heard from the regulator.
We can’t wait to start offering this valuable service to companies like yours.
But on an industry-wide level, this means that the party is about to start 😊🎉
You see, the accreditation of so many Master Trusts isn’t just a technical issue. It’s a real market disruptor which may have far-reaching implications.
On a basic level, you can expect Master Trusts to explode in popularity now that they are vetted and closely regulated.
You can be confident that your pension scheme is in safe hands when you hand it over to experienced trustees, who can give its administration proper care and attention whilst also most likely saving money for you.
Long-term, this may herald a significant change in the way companies run their pension schemes.
But the really exciting bit?
You’ll see a lot of innovation coming to the pensions market very soon.
You see, some of the smaller Master Trusts are doing things a bit differently, but until now, it’s been hard to know which of them you can trust.
Take our Master Trust.
It does all the “basic” tasks you would expect, handling governance and administration for your pension arrangement.
But we have also developed lots of new technology to get your members more engaged with pensions and help them make better financial decisions.
For example, we’ve built a platform called Next Generation Savings, which allows people to see all their financial information, like their mortgage, their bank balance and ISAs – all in one place.
Then they can play with the variables, so they can see exactly what might happen if they decided to save £10 more each month in their pension pot – or start overpaying on their mortgage.
We are also offering them a lot more ongoing communication about financial issues at relevant times in their life, and personal advice and guidance before and during their retirement.
Our thinking is that the more knowledgeable people are about their finances, the more likely they are to save for retirement….
…and we can give them additional tools to help them along the way.
And don’t be surprised if news about Master Trusts is suddenly everywhere over the next few months. This is, after all, the calm before the storm…