SPS Sainsbury's Section

Cash Balance Section

The Cash Balance Section is one of three sections in the Sainsbury’s Pension Scheme (the Scheme). It’s a defined benefit (DB) pension scheme like the other two sections, but it works rather differently.

The Cash Balance Section was set up in 2006 as a more affordable option for Sainsbury’s colleagues who couldn’t afford the higher contributions that were needed to stay in the Scheme’s Final Salary or Career Average sections.

Like these two sections, yours and the Company’s contributions were paid into a common pool of money that is used to pay members’ pensions. However, in the Cash Balance Section, rather than build up a set amount of pension, you have instead built up an amount of money called a personal account which has an annual increase in line with inflation each year.

When the Sainsbury’s Pension Scheme closed to future contributions in 2013, you stopped paying contributions, and so did the Company – but your personal account has continued to receive annual increases.

The Cash Balance Section provides you with a regular retirement income from the Scheme; the value of your personal account is exchanged for an annual pension that increases in line with inflation each year, and would pay a pension to your spouse or partner if you were to die before them.

You can take 25% of your Cash Balance personal account as tax-free cash, but that would reduce the amount of pension available to you from the Scheme.

Otherwise, you can instead transfer the value of your Cash Balance personal account out of the Scheme if you want to take it more flexibly or would prefer your pension in a different format to the one offered by the Scheme.

You can also choose a combination of options – take some tax-free cash, transfer some of it out so you can take it more flexibly, and use whatever’s left to provide a Scheme pension. That’s why it’s so important to take advice so you can understand what will be best for you.

Depending on when you were an active member, you may also have a Final Salary or Career Average pension from the Sainsbury’s Scheme as well as your Cash Balance pension. You must take your benefits from all the sections of the Sainsbury’s Scheme at the same time.

The Trustee has appointed LV=, a financial advice provider, to ensure you get the most from your benefits in the Sainsbury’s Pension Scheme. As you’re a Cash Balance member, the Trustee will pay for the cost of advice from LV=.

LV= is a leading retirement solutions provider. When the time comes for you to think about retiring, or you are coming up to retirement age and want some advice on your options, you can contact LV=

Their advisers provide regulated financial advice to people looking to retire and access their pension safely and accurately. LV= can advise you on a number of options according to your personal needs and preferences.


Find out more about the advice process here.

Using your own adviser?

Of course, you can also find and use your own independent financial adviser. If you don’t have an adviser, you can find one in your local area through this website: www.moneyhelper.org.uk

When choosing your own adviser, make sure they are authorised to give specialist pension advice by calling the Financial Conduct Authority (FCA) Consumer Helpline on 0800 111 6768. If you don’t use an FCA-authorised firm, you risk not having access to compensation schemes.


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