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NHS Pension forecast-Can I retire at 50?
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# 1
vinuela13
Old 17-09-2011, 4:18 PM
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Default NHS Pension forecast-Can I retire at 50?

Hi
I have recently received my pension forecast and it looks like I may be able to take a max lump sum at 50yrs and then a reduced annual pension.
I have been nursing since I was 18yrs and am now 48.
I am eager to take the lump sum and use this as an investment to provide an income when I no longer want or am unable to work.
The lump sum is quite a substantial amount but the annual pension will only provide me with a monthly income of around 350.
I willl actively seek work when I retire from the NHS and hopefully secure another job.If however I am unable to gain employment straight away will I be entitled to receive any other benefits to top up my monthly pension?
Thanks in advance
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# 2
Lokolo
Old 17-09-2011, 4:20 PM
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Why are you planning on taking the reduced one if you plan on continuing to work? (even elsewhere)
You only live once so make the most of it!
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# 3
JoeCrystal
Old 17-09-2011, 4:25 PM
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Well, what make you think you can get better return from the lump sum? If you need more income but not cash, then just do not take lump sum. Beside, can you work after age of 50 and get better pension anyway? You only got 30 years service, ten more years can increase the annual pension after all.
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# 4
jem16
Old 17-09-2011, 4:26 PM
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Quote:
Originally Posted by diddlyidi View Post
Hi
I have recently received my pension forecast and it looks like I may be able to take a max lump sum at 50yrs and then a reduced annual pension.
The age when you can take it, even actuarially reduced, is now 55.

Quote:
I am eager to take the lump sum and use this as an investment to provide an income when I no longer want or am unable to work.
Your lump sum will also be actuarially reduced by taking it early. However main question is why would you want to take it out of a tax-free shelter which has no investment risk to you, to bring it into a taxable environment where all the risk is on you? This makes no financial sense at all.

Quote:
I willl actively seek work when I retire from the NHS and hopefully secure another job.
Why seek another job? Why not continue to work for the NHS?
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# 5
snowcat53
Old 17-09-2011, 4:30 PM
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Taking your pension early massively reduces what you get, and for the rest of your life. Not sure it's allowed at 50 now anyway.

On the face of it this doesnt seem to make much sense. There is no way you can invest that to get more than the extra pension you would have leaving it in.
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# 6
vinuela13
Old 17-09-2011, 4:31 PM
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Quote:
Originally Posted by Lokolo View Post
Why are you planning on taking the reduced one if you plan on continuing to work? (even elsewhere)
I'm planning on taking the max lump sum asap. I have concerns that the lump sum will soon become taxable if the government has anything to do with it.Rumours are that this could happen overnight if they make this decision
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# 7
Lokolo
Old 17-09-2011, 4:32 PM
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Quote:
Originally Posted by diddlyidi View Post
I'm planning on taking the max lump sum asap. I have concerns that the lump sum will soon become taxable if the government has anything to do with it.Rumours are that this could happen overnight if they make this decision
Which rumours are these? Pub talk?

The government will very much unlikely make the lump sum taxable.
You only live once so make the most of it!
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# 8
Unclepetey
Old 17-09-2011, 4:33 PM
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Long-serving NHS staff have a protected minimum pension age of 50. So I suspect the original poster is right that he/she can retire at 50 and receive their benefits.
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# 9
Oldernotwiser
Old 17-09-2011, 4:34 PM
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You can't claim JSA (even the 6 months contributions based) with a pension of that amount. In fact, you won't be able to claim any means tested benefits with a substantial amount of capital.

This sounds like a really bad idea unless you can find another job first.
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# 10
vinuela13
Old 17-09-2011, 4:47 PM
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Quote:
Originally Posted by snowcat53 View Post
Taking your pension early massively reduces what you get, and for the rest of your life. Not sure it's allowed at 50 now anyway.

On the face of it this doesnt seem to make much sense. There is no way you can invest that to get more than the extra pension you would have leaving it in.
I don't intend to stay in the NHS past 55yrs old
I have been playing around with the figures and the difference in lump sum if I retire at 55 as opposed to 50 is approx 6k and my monthly pension would only go up to 440 per month. My contribution to my pension over the 5yrs that I would continue to work would be approx 4800, parking costs 900,union subs 600, nmc registration 380.
So for working another 5yrs and risking my lump sum being taxable I don't really appear to gain very much
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# 11
vinuela13
Old 17-09-2011, 4:48 PM
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Quote:
Originally Posted by Lokolo View Post
Which rumours are these? Pub talk?
These have actually come from the pensions team at the Hospital
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# 12
jem16
Old 17-09-2011, 4:49 PM
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Quote:
Originally Posted by diddlyidi View Post
These have actually come from the pensions team at the Hospital
The worst rumours always seem to come from the NHS pension department.
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# 13
vinuela13
Old 17-09-2011, 4:53 PM
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Quote:
Originally Posted by jem16 View Post
Why seek another job? Why not continue to work for the NHS?
The Trust that I work for is looking to get rid of staff at the moment. Morale is very low and bullying and threats are becoming more commonplace
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# 14
JoeCrystal
Old 17-09-2011, 4:55 PM
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Quote:
Originally Posted by diddlyidi View Post
So for working another 5yrs and risking my lump sum being taxable I don't really appear to gain very much
An increase of 25% in income. index-linked and the 'cost' of pension to you is small in comparison [Basically an level income of 1,080 could require a fund of 25,116. Index-linked income cost more. In other word, you are paying modest 80 per month rather than 420 per month (Not certain about that last number though)].

Tax Free Lump Sum as other points out clearly is not going to be taxed. IF government want to do it, they will have to do a consultation for years!

Cheers

Joe
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Last edited by JoeCrystal; 17-09-2011 at 5:10 PM.
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# 15
snowcat53
Old 17-09-2011, 10:50 PM
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I also know people in our Pensions dept. They know no more than Joe Bloggs in the pub. These soothsayers predicting the end of tax free lump sums will be nowhere to be found when they are proved to be wrong and you want to berate them in 10 years time.
You have been warned.
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# 16
atush
Old 17-09-2011, 11:10 PM
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Quote:
Originally Posted by diddlyidi View Post
The Trust that I work for is looking to get rid of staff at the moment. Morale is very low and bullying and threats are becoming more commonplace
The rumors are false, and if the trust is looking to get rid of people, don't retire and look for a voluntary redundancy offer instead.

If you do decide to go ahead with this (IMO) bad idea, then find a job before you retire.
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# 17
dunstonh
Old 17-09-2011, 11:31 PM
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Quote:
These have actually come from the pensions team at the Hospital
So a complete bunch of unqualified and low knowledge idiots then.

You only have to look back on this forum to see how the NHS staff seem to have the most consistent misinformation about pensions going. That is also reflected by those of us in the advice industry where the NHS staff seem to be worst informed and the ones most prone to rumours and rubbish from workmates.

Quote:
I have concerns that the lump sum will soon become taxable if the government has anything to do with it.
There has not even been a whiff of a suggestion of it. It is highly unlikely that a Conservative Govt would do it considering the bulk of pension legislation that exists today was theirs to begin with.

Planning your financial future on a bunch of idiots is not the way to do it.
I am a Financial Adviser. Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
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# 18
atush
Old 18-09-2011, 8:11 AM
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Probably the worst disaster Private pensions have ever undergone, was the raid by Gordon Brown in his early days of chancellor when he taxed the dividends on our (formerly tax free) pensions. Wiped Billions off the value and growth of all pirvate pensions.

So I am not sure that you should be afraid of the Con/dems on this matter really.

I too am shocked at the ignorance (to be fair to information given) of the public sector NHS workers on here. Their Unions and HR are really not earning their gold plated salaries and pensions in the way that they are letting down and misinforming or not informing their members.
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# 19
moonrakerz
Old 18-09-2011, 8:58 AM
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Quote:
Originally Posted by atush View Post
I too am shocked at the ignorance (to be fair to information given) of the public sector NHS workers on here. Their Unions ........... are really not earning their gold plated salaries and pensions in the way that they are letting down and misinforming or not informing their members.
What do you expect from public sector unions ?

The greater the state of fear and ignorance that they keep their members in, the better for them.
The unions leaders are just as much money grabbing hypocrites as the bankers and politicians are.
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# 20
StephenM
Old 18-09-2011, 9:11 AM
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Quote:
Originally Posted by diddlyidi View Post
These have actually come from the pensions team at the Hospital
Sorry to go off at a tangent, but why does a hospital need a pensions team. Its a national pension scheme, presumably with a centralised department running it. I don't think there's anything localised about the NHS pension scheme, so what does a local pensions team actually do.
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