My Gold plated NHS Pension ????

[tonyh29]

4 minutes ago, Davkaus said:

It horrifies me how few young people have an adequate pension provision.

long term won't work place pensions alleviate this ?

it goes up to 8% from 2019 (employee + employer contributions)  .. if you earn £20k a year for 50 years working life that's £80k before you factor in any  returns 

still not a fortune , but better than the current average of £50k in a pension pot 

 

[Davkaus]

Just now, tonyh29 said:

long term won't work place pensions alleviate this ?

it goes up to 8% from 2019 (employee + employer contributions)  .. if you earn £20k a year for 50 years working life that's £80k before you factor in any  returns 

still not a fortune , but better than the current average of £50k in a pension pot 

 

Hopefully it will. I think the problem is it's started too small, there's a lot of people/companies still only contributing 1% which is basically pointless. People who start working in 2019 and pay in a minimum of 8% over their career ought to have some decent savings, but there's a huge shortfall in people currently in their 30s to 40s for whom I think 8% is just not going to be enough. 

Who knows what the state pension is going to be like in 30 years, though.

[hippo]

1 hour ago, tonyh29 said:

long term won't work place pensions alleviate this ?

it goes up to 8% from 2019 (employee + employer contributions)  .. if you earn £20k a year for 50 years working life that's £80k before you factor in any  returns 

still not a fortune , but better than the current average of £50k in a pension pot 

 

I actually think work pensions could make it worse. My 19 year old son pays £10 a month and the employer contributes £1 - its a tick box exercise - he has a work place pension.

Back to my NHS Pension - I really can't see it appealing to many young people, I barley seem to be getting my own contributions back - and with the amount people not joining/leaving the scheme - I wouldn't be totally surprised if I get that.

I also think they ought to stop the endless set of changes to the NHS scheme - If you shell out £200 pm and be told you get your pension at 60 that should be cast in stone - 10 years in they say 'ah..... your not getting until your 67 now'  I really don't know how they get away with it.

 

 

[Demitri_C]

I work for the NHS and i thought there was a penalty charge if you took it before the age of 67?

I am not part of the pension scheme i thought its a waste of time and god knows if i ever will see that money 

[Davkaus]

What's your alternative plan for retirement? 

[Davkaus]

45 minutes ago, hippo said:

I actually think work pensions could make it worse. My 19 year old son pays £10 a month and the employer contributes £1 - its a tick box exercise - he has a work place pension.

As I understand it, either you're misinformed, your son earns £100 a month (or isn't PAYE), or his employer is breaking the law.

Admittedly, they only have to pay 1%, but there's a series of increases to this percentage, starting next April.

Quote

 I barley seem to be getting my own contributions back -

I find this incredibly hard to believe, even given your late start to contributions. It's probably worth speaking to a qualified financial adviser to assess your current position and to see what options you have to improve your position over the next 10 years.

Quote

I also think they ought to stop the endless set of changes to the NHS scheme - If you shell out £200 pm and be told you get your pension at 60 that should be cast in stone - 10 years in they say 'ah..... your not getting until your 67 now'  I really don't know how they get away with it.

AFAIK, you had the right to stay on the old scheme with a retirement age of 60, NHS employees were given the choice of moving on to the 2008 plan. Why did you move?

Edited November 17, 2017 by Davkaus

[hippo]

22 minutes ago, Demitri_C said:

I work for the NHS and i thought there was a penalty charge if you took it before the age of 67?

I am not part of the pension scheme i thought its a waste of time and god knows if i ever will see that money 

Yep - thats the new scheme - as I am older I stay in the old scheme (pension at 60) until next year. My 14 years contributions I still get when I m 60 - but anything I contribute next year goes towards my pension at 67. So my age 67 pension pot would based on 4.5 years contributions - not worth having, so I and many others will pull out at that point.

As i said I do have other pensions - so retiring at 60 shouldn't be a problem for me. I do feel the 14 years contributions have yielded very little.   

[tonyh29]

54 minutes ago, hippo said:

I actually think work pensions could make it worse. My 19 year old son pays £10 a month and the employer contributes £1 - its a tick box exercise - he has a work place pension.

 

I don't think that's legal ( depending on his age and job perhaps)  .... it's a compulsory amount of your salary  not a token contribution

 

Edit - see reply  from Davkaus already covering this

Edited November 17, 2017 by tonyh29

[hippo]

2 minutes ago, Davkaus said:

As I understand it, either you're misinformed, your son earns £100 a month (or isn't PAYE), or his employer is breaking the law.

Admittedly, they only have to pay 1%, but there's a series of increases to this percentage, starting next April.

Which plan are you on? 2008 or 2015?

 

AFAIK, you had the right to stay on the old scheme with a retirement age of 60, NHS employees were given the choice of moving on to the 2008 plan. Why did you move?

I joined the NHS in 2003 - and never moved schemes voluntarily 

I can still get my pension at 60. But then with no choice offered I can't contribute to the pot I get at 60 next year - I move to the 2015 scheme (no choice) but any contributions I make I don't get until I am 67.

See what I mean about the changes ?  - 3 of us here all thing the NHS scheme works differently - its the same at work, even if you see the advisors people with similar work history are getting drastically different figures. Its that complicated no one knows 

 

[hippo]

Just now, tonyh29 said:

I don't think that's legal ( depending on his age and job perhaps)  .... it's a compulsory amount of your salary  not a token contribution

OK - maybe he's bullshiting me so he doesn't have to pay 'keep' !

[ender4]

5 hours ago, hippo said:

I currently pay £220 pm - and having been paying into this for 14 years at a similar level .....

I was staggered how little this gives me.......

So guesses below please - there are 2 elements

Lump Sum

Annual pension 

(you are allowed to read the daily mail/express before entering your guesses)  

 

 

You've paid in £200 x 12 months x 14 years = £36,960.

Your retirement age on this pension pot is 60.    The average life expectancy is around 85. 

So you've got to spread the pension pot between 25 years. 

£36,960 / 25 years = £1,478 per year. 

You're going to get higher than this because of stock market rises, compound interest, employer and government adding in their contributions.

£2.5k a year, plus a lump sum, seems reasonable.  

 

[Demitri_C]

48 minutes ago, hippo said:

Yep - thats the new scheme - as I am older I stay in the old scheme (pension at 60) until next year. My 14 years contributions I still get when I m 60 - but anything I contribute next year goes towards my pension at 67. So my age 67 pension pot would based on 4.5 years contributions - not worth having, so I and many others will pull out at that point.

As i said I do have other pensions - so retiring at 60 shouldn't be a problem for me. I do feel the 14 years contributions have yielded very little.   

You could always do what most NHS employees do, retire/leave trust for 3 months then sign up on the bank and get employed again (that is if you get bored of retirement) 

[hippo]

1 minute ago, Demitri_C said:

You could always do what most NHS employees do, retire/leave trust for 3 months then sign up on the bank and get employed again (that is if you get bored of retirement) 

Yes I could - but Bank staff are generally only employed at the lower grades. Its not like I could walk back in on my current salary.

[hippo]

17 minutes ago, ender4 said:

You've paid in £200 x 12 months x 14 years = £36,960.

Your retirement age on this pension pot is 60.    The average life expectancy is around 85. 

So you've got to spread the pension pot between 25 years. 

£36,960 / 25 years = £1,478 per year. 

You're going to get higher than this because of stock market rises, compound interest, employer and government adding in their contributions.

£2.5k a year, plus a lump sum, seems reasonable.  

 

Maybe it is 'reasonable' but it isn't anything special - and I don't see that deal enticing many young people to join up so what happens then ? - as the current contributors (workers)  pay the pensions of those who have retired. IMO this pension scheme has been ruined - and I don't see any winners anywhere - if it collapses the govt will surely have to bail it out - so why make it so unattractive ? - I thought they didn't want loads of people dependent on the state.

 

Edited November 17, 2017 by hippo

[ender4]

1 minute ago, hippo said:

Maybe it is 'reasonable' but it isn't anything special - and I don't see that deal enticing many you people to join up so what happens then ? - as the current contributors (workers)  pay the pensions of those who have retired. IMO this pension scheme has been ruined - and I don't see any winners anywhere - if it collapses the govt will surely have to bail it out - so why make it so unattractive ? - I thought they didn't want loads of people dependent on the state.

 

yes, agreed, its not special.    

Just to clarify - its not a final salary scheme, but a defined contribution/money purchase scheme?

Its still better than not putting the money into the pension - if you had put that in a bank/under your mattress, you'd only have the equivalent of £1,478 per year, rather than £2,500 per year.

You're basically £1,000 per year, or £25k in total better off by putting into the pension. 

[hippo]

1 minute ago, ender4 said:

yes, agreed, its not special.    

Just to clarify - its not a final salary scheme, but a defined contribution/money purchase scheme?

Its still better than not putting the money into the pension - if you had put that in a bank/under your mattress, you'd only have the equivalent of £1,478 per year, rather than £2,500 per year.

You're basically £1,000 per year, or £25k in total better off by putting into the pension. 

Not sure - it used to be a final salary scheme - then all the changes came and nobody was quite sure what was going on - now it definitely isn't  ! 

Glad im not relying on it ! 

[Davkaus]

As I understand it from what you've posted, you'll still be getting your first plan's final salary pension, it's just after a certain point, your contributions go towards a separate pension scheme, which is on the 2015 plan? So you still have your original final salary pension?

If you don't understand this, you can get free financial advice. https://www.pensionsadvisoryservice.org.uk/

Get your pension statements together, and give them a call. I can understand some frustration at feeling you're not getting value for money, but if you don't even understand what type of pension you have at the moment, you need to speak to someone who knows their stuff.

[ender4]

Just now, Davkaus said:

As I understand it from what you've posted, you'll still be getting your first plan's final salary pension, it's just after a certain point, your contributions go towards a separate pension scheme, which is on the 2015 plan? So you still have your original final salary pension?

If you don't understand this, you can get free financial advice. https://www.pensionsadvisoryservice.org.uk/

Get your pension statements together, and give them a call. I can understand some frustration at feeling you're not getting value for money, but if you don't even understand what type of pension you have at the moment, you need to speak to someone who knows their stuff.

thats a good point - it looks like this is just the middle pension that we are talking about. 

so the original final salary pension, this pension over 14 years paying £2,500 a year, and then the new pension from now to retirement age. 

[Demitri_C]

1 hour ago, hippo said:

Yes I could - but Bank staff are generally only employed at the lower grades. Its not like I could walk back in on my current salary.

Of course, you probably get a band 3 job but your past experience you would be a higher band. See it all the time at my trust 

[Demitri_C]

1 hour ago, ender4 said:

yes, agreed, its not special.    

Just to clarify - its not a final salary scheme, but a defined contribution/money purchase scheme?

Its still better than not putting the money into the pension - if you had put that in a bank/under your mattress, you'd only have the equivalent of £1,478 per year, rather than £2,500 per year.

You're basically £1,000 per year, or £25k in total better off by putting into the pension. 

Unless of course you have invested the money into something else, such as a property