Opting in S2P

savingforarainyday

I am hoping someone out there will be able to help me.

DH has been advised by Friends Provident to opt back in to state system re what was SERP/S2P pension contributions, this I understand is due to his age 47 (over 42 I think was mentioned).

I have read the notes that accompany his annual statement, and I think where there has been an additional rebate paid in by National Insurance Contributions, I understand that ends this year, and they will contribute less.

The Pension was a company scheme, and he finished making any contributions himself when he changed jobs.

He was an employed person from 16 to 22 then self employed up to 1991 (8 years), he opted out md-late nineties, so would he benefit by re-entering the system, given he would like to retire in 10 years time.

He now pays into a pension with his new employer, with another provider.

Any advice/clarification would be appreciated

dunstonh

You havent asked any questions.

Is your other half in a contracted out pension at the moment through the workplace or is he contracted in?

savingforarainyday

The question was should he opt back in? Sorry

Just been and had a look. He is not contracted out under the new arrangement, so I have contacted Friends provident for the forms for him to sign to contract back in, but we are just wavering at the moment as to what the best thing to do is

savingforarainyday

When you start a new scheme, does this supercede any intructions under any old arrangements?

I thought you would have to sign something to transfer it, given I have never had to do this I know nothing

dunstonh

optimal age to contract in is age 43 for a male.

EdInvestor

He should contract back in at his age as he will likely get more from the extra state pension than the private pension.

You should get a forecast from https://www.thepensionservice.gov.uk showing how much basic and how much SERPS/S2P state pension he is due to get.

What fund(s) is is FP pension invested in? If With profits, the performance may be poor and you should perhaps consider switching to different funds, though maybe best to wait until markets stabilise.

Paul_Herring

dunstonh wrote: »

optimal age to contract in is age 43 for a male.

I'm assuming this is for 'today.'

Are there any guidelines for 'next year'? i.e. will it be 43 next year for 43 yr olds as well?

Assuming that 2012(?) is the year that everyone will be 'contracted back in' anyway what are the numbers for the next few years?

<hijack> I'm 36, I'm happy remaining contracted out (but not necessarily where my protected rights are going, that's a different matter - I'm aware of what's happening to them and what I can do about it.) I'd rather have the money in my pension scheme rather than some nebulous promise of something I might get in 30/1/2/3/4 years from the state.

Is there any point in time (given _current_ circumstances, and my POV) where it would potentially be to my advantage to contract back in?

dunstonh

it has the potential to move every year and historically it has moved frequently. It was in the 50s in the early days. If I could contract out, I would do so and I would see it through to 2012-15 (its still not cast in stone when it finishes) even if it meant I would pass the optimal age to contract back in. A bird in the hand is worth two in the bush in my opinion.

savingforarainyday

Originally posted by Edinvestor
What fund(s) is FP pension invested in? If With profits, the performance may be poor and you should perhaps consider switching to different funds, though maybe best to wait until markets stabilise.
_________________________________________________________________

Funds are

Balanced Mixed M
Secure Growth P

25/75 Split 25 Balanced/75 Secure

Cant see the words with profits, but will go and investigate older paperwork

Thank you

EdInvestor

That's not with profits so no problem there.

Given that contracgting out will end anyway in 2012, you may want to stick with it until then.But I would first check the pension forecast to see what you might be missing out on. Ask them to give you an additional forecast based on you contracting back in.

savingforarainyday

Thanks for that. I will ask for the additional forecast when we have seen the pension forecast.