Moving jobs - pension advice please

number9

I am about to leave my employer and have 20 years contributions into a final salary scheme.

I am joining the Civil Service and have not yet received any details from them detailing the pension options available to me although I am expecting these any day now.

Do I leave the 20yrs final salary pension alone or transfer? Having been with the same employer for so long I have no experience regarding pensions and so would appreciate some advice.

I usually consider myself financially savvy but pensions are a nightmare and, as they are so important to everyone, they should be made much easier to understand.

(Male, aged 40, married, two dependents 12 &15)

number9

btw, I have had a look at the civil service pensions site and am still no wiser...sorry.

http://www.civilservice-pensions.gov.uk/scheme_information.html

number9

more info... my wife is 42 and a nurse in the nhs (5 yrs service and contributions only) and therefore in their pension scheme.

she has no pension contributions/scheme membership prior to this job.

dunstonh

Do I leave the 20yrs final salary pension alone or transfer?

Whichever one gives you the best figures and retained benefits and is suited for your requirements.

The problem is that unless a transfer analysis is done (TVAS) there is no way for anyone to tell you what the best option is. To do so would be life saying should I eat the item in my left hand or eat the item in my right without anyone knowing what the items are.

I usually consider myself financially savvy but pensions are a nightmare and, as they are so important to everyone, they should be made much easier to understand.

Dont complain. The simple pensions are not as good as these usually. So, put up with the complications in the knowledge you are better off.

number9

Is the TVAS calculation something that a IFA must do (and of course charge for) or is there a way of finding out or estimating your position?

Andy_L

You can join either
"Partnership" which is the money purchase scheme, at age 36-40 they will pay 10% into your pension plus an extra 3% if you contribute 3%.
http://www.civilservice-pensions.gov.uk/scheme_information/partnership/how_much_does_it_cost.html
or
"Nuvos" which is the new career average scheme, drastically oversimplifying it, works in a similiar way to your current final salary scheme but instead of using your final salary to calculate the pension it uses your career average salary.

You can transfer your existing final salary scheme in and it will be held as a separate final salary pension to Nuvos and thus based on your final salary as a civil servant or leave it where it is where your final salary in your old job will be uprated by RPI every year (possibly with a cap)
As Dunstonh says whether you should transfer it or not depends on which is the best financial deal for you which depends on a number of factors including:
How much 20 years in the old scheme buys in the civil service
How you think your salary will increase in the CS compared to the RPI increase in your old pension.

jenniferfluff29

My husband is in the same situation. Had a final salary pension (12 years) and looking into transferring into his civil service (C.S) pension scheme. The civil service pension will contact the previous pension scheme and request the value of the pension with them. You then get a letter from C.S. pension scheme telling you how much your original pension is worth and how much it is worth when you transfer it. My husbands was £ 8000 p.a. in his original fund and the civil service will only offer him about £4000 (I think) when transferring it.

You only have a year to decide whether you wish to transfer or not. We currently are weighting up whether to leave the pension with the previous employer (which is a retail delivery company and they may in the next 30 years go under) or to transfer the pension at half the original value but at least the pension (hopefully) will be safe. Tough decision when you see the large drop in the fund, but at least the civil service will be a little safer.

P.S. My husband joined the NUVOS pension scheme.

Hope this helps.

FLuff

Andy_L

number9 wrote: »

Is the TVAS calculation something that a IFA must do (and of course charge for) or is there a way of finding out or estimating your position?

Depends, you can get the quote for years bought in the CS scheme by filling in a form, you could then go through the scheme rule books & comparing them & then make some assumptions about payrises compared to inflation. However if you get it wrong you have no one to blame but yourself , or some self-apointed expert on an internet forum .

If you join one of the CS Unions they should have financial advisors avaliable who are free aand clued up on CS pensions & that's the route I'd recomend (Prospect does, I don't know about PCS).

number9

Although I have a lot of work to sort this out thanks for letting me know your thoughts and sharing your experiences.

I am taking a drop in pay in my new job and my old employer has been around for 43yrs but who knows how long they will be in business (hard nosed Swedish organisation). Interesting to know that some good civil service help may be available and that there may be 12mths to decide. I will listen to them ans make decisions in due course.