Here are some of the most commonly used terms and phrases in the pensions market, many of which you will find on this website. This list is meant only as a handy guide and not as individual pensions advice.

For any specific questions about your pension provision, please contact us.

additional investment options

Many schemes offer, alongside their default investment fund, additional investment funds, which have their own annual management charges. Members can choose to pay all or part of their existing or future contributions into one or more funds. These funds may invest in specific areas or investment classes, such as equities, company shares, corporate bonds and property funds, and have varying risk profiles. Ensign members have access to quarterly factsheets explaining the different investment funds, their risk profile and fund objectives, and previous, and target performance levels.


The day-to-day running of a pension scheme, from collection of contributions and benefits payments, to member communication and record keeping. In Ensign’s case, this is done by our partner Aegon.


An insurance-based pensions product that pays out a regular income in retirement for the rest of your life or a set period of time.

automatic enrolment

The UK government initiative requiring all employers to offer a workplace pension scheme and enrol all eligible workers into it. Under auto enrolment, both the employee and employer make regular contributions into the employee’s pension.

defined contribution (DC)

A DC scheme is a type of retirement plan into which employer and member both pay regular contributions and where the member’s benefits are determined by the value of the pension fund at retirement. This is also known as a ‘money purchase’ scheme. This is different to a defined benefit (DB) scheme, where the pension scheme promises a set pay-out on retirement, usually based on the years you’ve worked and the salary you’ve received.

income drawdown

This is a flexible way of taking money from your pension pot, allowing you to withdraw money from your pot on a regular or irregular basis. You normally have to wait until you’re at least 55 to start drawing down income from your pension, and you can leave the rest of your pension pot invested and continue contributing to it if you wish.

master trust

In the UK, a master trust is an occupational pension scheme where multiple, non-associated employers can participate. Ensign is a master trust pension scheme, open to any employer with a connection to the UK maritime industry.

members’ benefits

This refers to the assets within the member’s retirement fund at any given time.

money purchase

Another term for defined contribution pension scheme – see above.

management charge/fee

Pension plans come with their own set of charges. The most common is an annual management charge, which helps to pay for admin costs. It’s important to be aware of the charges and costs associated with your pension as they can have a significant impact on the value of your pension pot. Ensign offers some of the lowest management fees in the pensions industry.

target date fund

This is a type of fund based on the expected age when a member hopes to retire. Investments are tailored to the path of the fund, for example, by becoming more conservative as an individual gets closer to retirement.

tax-free lump sum

Members of defined contribution schemes can choose to withdraw up to 25 per cent of the value of their pension pot as a tax-free lump sum. Any amount taken after that 25 per cent, whether as a lump sum or regular payments, is taxable.


An individual appointed to ensure a pension scheme is run properly and look out for the interests of members. In Ensign’s case, we have four trustee directors who use their combined 120 years of maritime, trade union and pensions experience to make the best decisions on behalf of employers and members.

workplace pension

A workplace pension, also known as an occupational pension scheme, is a way of saving for your retirement. Your employer arranges this. As a result of automatic enrolment (see above), more people have a workplace pension than ever before.