kingrollo
Guru
Where do you get the figure of £20k from ? ...
Without broadcasting my finances over the internet - I pay approx £240pm into the NHS pension.....after 20 years I get a £5k pa pension - don't think it great myself.
Pension advice
- Thread starter ren531
- Start date
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Where do you get the figure of £20k from ? ...
Without broadcasting my finances over the internet - I pay approx £240pm into the NHS pension.....after 20 years I get a £5k pa pension - don't think it great myself.
cisamcgu
Legendary Member
- Location
- Merseyside-ish
That seems surprisingly low - are you sure ?
kingrollo
Guru
Well that's what I've been told on a forecast - and my colleagues are getting similar forecasts. So not the holy grail of pensions you are lead to believe.
Luckily I have a prior pension which is paying a lot more
midlife
Guru
Calculating your salary....... Presumably you are on he 1995 section so 1/80th final salary per year pension. 20 years = 20/80 , so one quarter final salary after 20years.
£5k pension, so if one quarter final salary then salary = 4 x pension. = £20k
For £5k pension for life roughly translates to a private pension pot of circa £150000, over 20 years without interest that's £625 a month which is a bit more than the NHS.
cisamcgu
Legendary Member
- Location
- Merseyside-ish
Accrual rate is 1.85% so a quick and dirty calcuation shows
| % Accrual Rate | Annual Salary | Accrued per year | No of years | Accrued value |
1.85 | £10,000.00 | £185.00 | 20 | £3,700.00 |
1.85 | £15,000.00 | £277.50 | 20 | £5,550.00 |
1.85 | £20,000.00 | £370.00 | 20 | £7,400.00 |
1.85 | £25,000.00 | £462.50 | 20 | £9,250.00 |
1.85 | £30,000.00 | £555.00 | 20 | £11,100.00 |
Dont forget the McCloud ruling will affect those who were age discriminated into the 2015 scheme and will have the option of going back into the previous schemes.
https://www.nhsemployers.org/articles/mccloud-remedy
@kingrollo be aware (if you are not already) that the predictions from NHSBSA re your pension are not accurate until you are very near your retirement date.
Pensions are so complex and do take some time by yourself or IFA to work through the minefield.
i have two separate pensions. Pre NHS and now NHS. As I start moving to retirement (!) working out the myriad of changes and impacts (of both) is not straightforward.
https://www.nhsemployers.org/articles/mccloud-remedy
@kingrollo be aware (if you are not already) that the predictions from NHSBSA re your pension are not accurate until you are very near your retirement date.
Pensions are so complex and do take some time by yourself or IFA to work through the minefield.
i have two separate pensions. Pre NHS and now NHS. As I start moving to retirement (!) working out the myriad of changes and impacts (of both) is not straightforward.
kingrollo
Guru
1. I am quite near retirement date - but probably won't be going at 60.
2.From October more flexibility is offered in that you can claim your pension (some or all) and stay at work on the same contract (different from the existing retire & return)
My contribution to this thread - is more about the general fact that the NHS pension isn't great......I do fear for the scheme as hardly any younger staff join it - citing the expense and constant changes .
midlife
Guru
Interestingly I had the letter about retiring “your way” in October, from what I read you have to work so that your hours accrue 10% less pensionable pay. Have written to my employers yesterday about it as I am 64 this year.
Despite the changes to the NHS pension over the years I don’t know of any financial advisors that suggest you don’t join.
kingrollo
Guru
Looking at it like that yes I agree.
But a young 20 something - perhaps earning around £20k - is a bit reluctant to shell out £200pm for scheme that will most likely change its terms and conditions - IE retirement age - % contribution - I have to say they have a point -if was 20 right now -i wouldn't join.
I joined my pension scheme when I was 19 and so glad I did.
Yes, schemes are less generous now than before but still a better return on your money when you look at the payback over your lifetime plus death benefit.
The challenge is that people either can’t afford or don’t want to spend £200 per month for something they won’t see for 40 years!
Trouble is when they do get to retirement and only have the state pension then they’ll find they are going to struggle.Anyways, that’s another discussion for another time!
Yes, schemes are less generous now than before but still a better return on your money when you look at the payback over your lifetime plus death benefit.
The challenge is that people either can’t afford or don’t want to spend £200 per month for something they won’t see for 40 years!
Trouble is when they do get to retirement and only have the state pension then they’ll find they are going to struggle.Anyways, that’s another discussion for another time!
fossyant
Ride It Like You Stole It!
- Location
- South Manchester
It's better than most schemes ! You need to max the years out really - just like you need to max out contributions on other schemes
kingrollo
Guru
Or in 40 years time -the rules and retirement ages will have changed -i wouldn't invest something where the goal posts are constantly changing.
Plus you can have more fun with that £200 in your twenties - as you get older you options to enjoy that money reduce.
Mine will probably sir in a bank account and go to my kids when I croak it. !
rualexander
Legendary Member
I worked in the NHS from 1985 to 1991, final salary when I left in 1991 was £15k, hit 60 last year and now get pension of £2600 a year, pretty decent in my opinion for 6 years work thirty years ago.
Although personally I'd have preferred to have the option of taking a Cash Equivalent Transfer Value of around £60k, but that wasn't available.
Although personally I'd have preferred to have the option of taking a Cash Equivalent Transfer Value of around £60k, but that wasn't available.
fossyant
Ride It Like You Stole It!
- Location
- South Manchester
It's still better than most pensions companies offer.
I shove in about 10٪ into a Local Govt Scheme and my employer another 20%. I've 16 years in this scheme, 10 in another final salary scheme, and another 10 in private pensions.
Yes £200 or so is better fun to blow when you are 20. Ive been paying in since I was 16.
