28 Mar Why an umbrella pension and provident fund?
In a tight economy many companies are looking for greater cost-efficiencies across the board, including in the retirement fund and group employee benefits sector.
Standalone funds have benefits but against the backdrop of the current economy, here are some of the benefits of Umbrella Funds to consider.
1. Control.
Umbrella Pension and Provident Funds typically consists of a number of employers but provision can be made for participating employers to appoint their own advisory body which partly defeats the purpose of achieving greater efficiencies. Employers have the comfort of knowing that Umbrella Pension and Provident Funds are managed by a central board of trustees appointed to look after the interests of employers. One of the boxes ticked by employers when selecting an Umbrella Fund is the quality, experience and skills of the Fund’s board of trustees.
2. Efficiencies.
With the increase in regulatory pressure and governance standards, the time and knowledge demands of standalone fund trustees’ increases and also brings greater risk. The economies presented by Umbrella Pension and Provident Funds can reduce costs and time, while the up-to-date knowledge of the board of trustees reduces risk which in turn can reduce costs for both the employers and employees.
There are other benefits associated with an Umbrella Fund such as flexibility and other value-added benefits and it is best to talk to a Salt Employee Benefit professional to find out more about how an Umbrella Fund can meet the needs of an employee and employer.