House purchase plans
Innovative employer’s help staff get on the property ladder

Employers are coming to the rescue of their cash-strapped graduate recruits by introducing new schemes that substitute a pension for help getting on the property ladder or clearing student debt.

Company pensions are an attractive perk but many require staff to make a contribution. That is why people in their twenties, struggling under student loan repayments and desperate to buy their first property, often decide not to join.

Would-be first-time buyers who do not want to join some company pension schemes are being offered a house purchase plan, under which the employer contributes a percentage of the employee’s salary for two years into a savings account dedicated to funding the deposit. To benefit from the scheme employees must also put the same percentage of salary aside each month.

Once the property has been bought the company pays the same percentage of salary towards the employee's mortgage for the next three years, reducing over the next four years. As the mortgage contribution is phased out, the employee is moved back into the pension scheme.

These "flex" schemes effectively give employees an annual allowance to spend on a menu of benefits and let you tailor the benefits to your needs.

This article is for your general information and use only and is not intended to address your particular requirements. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without appropriate professional advice after a thorough examination of their particular situation. Your home may be repossessed if you do not keep up repayments on your mortgage.

Article date: 07.07