Pension Jargon

PERSONAL PENSION PLAN

• A regular or single premium pension policy which can be taken out by the self employed and employees in non pensionable employment.

PERSONAL RETIREMENT SAVINGS ACCOUNTS (PRSAs) 

• A regular or single premium pension policy taken out by an individual and which is aimed primarily at the self employed and employees in non pensionable employment.

OCCUPATIONAL PENSION PLANS

• A regular or single pension policy taken out by an employer or pension scheme trustee to provide retirement benefits and/or death benefits for one or more director or employees of the employer.

ADDITIONAL VOLUNTARY CONTRIBUTIONS (AVCs)

• A regular or single premium pension policy taken out by a pension scheme trustee on behalf of an employee who is already in a pension scheme at work, to top up the employee’s retirement benefits at his or her own expense.

BUY OUT BONDS

• A single premium pension policy into which the value of an employee’s retirement benefits in a former employers’s pension scheme are paid.

APPROVED RETIREMENT FUND (ARF)

• A single premium pension policy into which the value of an individual’s retirement benefits are paid at retirement, instead of using these funds to buy an annuity.

ANNUITY

• A single premium policy issued by a life assurance company which provides a guaranteed regular income for life, in return for a lump sum payment from a pension arrangement.