Pension transfer

harvestmoon

I am a 51 year old female teacher with only a few years pension credit as I opted for personal pensions some years ago. I have recently applied to transfer original funds back into the teachers scheme and for £44,000 am being offered 5 years pension credit. Does anyone have any views on this?

DiggerUK

Harvestmoon,

The mistake you made transferring out of the teachers pension must have dawned on you by now.

I would strongly advise you to get in touch with your union about this.
I think you are past deadlines for miss selling compensation, but check with your union.

If you can get back in to your teachers pension do so, it is the best scheme to be in.

Don't cry over spilled milk, put right what you can.
All the best.

harvestmoon

Hi Diggeruk
Thank you for your reply. Not wanting to claim compensation, it was purely my decision based on the fact that, at the time of opting out, if you died in service, your husband and/or children did not receive your pension - the state took it. If you were male, that wasn't the case. Nevertheless, that's all changed now, thankfully.
No - merely wanted to ask if, what I was buying back was a good deal since the financial advisor of a colleague suggested that the TP was not all it's cracked up to be and maybe what I was being offered in 'buy back years' was not great.
Do you have experience in this field? I'd very much appreciate your feedback.

DiggerUK

Harvestime,

What teachers pension scheme (TPS) were you in?
Dependents not getting benefits is a new one on me.
Who told you this?

How many years have you got locked in the TPS scheme?

As I suggested you see your union it should tell you my experience, very lay, but extensive.

If you have been stuffed over by bad advice then screw them, you could have been robbed blind.
Get your due compensation if available.

I think I know what the villain presented themselves to you as. Not a discussion for your thread though.

Chin up girl.

jem16

DiggerUK wrote: »

Harvestime,

What teachers pension scheme (TPS) were you in?
Dependents not getting benefits is a new one on me.
Who told you this?

It's true. Married female teachers did not have the same rights to spouse pensions as married male teachers. The rules changed somewhere around the late 80s I believe.

If you have been stuffed over by bad advice then screw them, you could have been robbed blind.
Get your due compensation if available.

I think I know what the villain presented themselves to you as. Not a discussion for your thread though.

Chin up girl.

Your obvious bias against IFAs comes shining through as usual.

dunstonh

somewhere around the late 80s I believe.
<snip>
Your obvious bias against IFAs

I think it was 6th April 1988 that the rules changed on female teachers.

Polarisation didnt come in until 29th April 1988. Thats when the term IFA first applied. So, its impossible for an IFA to have done it as the rule change allowing it occured before IFAs existed. An agent or broker may have been involved but its pre-regulation and harvestmoon has stated that it wasnt done on advice (before regulation you didnt get advice in the same way as now). Digger is jumping to assumptions again

The biggest shame here is that its taken 20 years to find this out as harvestmoon could have got back into the occ scheme much earlier. The only time an adviser could be liable for mis-sale is if the personal pension had been increased through an adviser after April 1988. However, its also unlikely that harvestmoon has a personal pension as they wouldnt have existed at the time it was taken out either. It would have probably been a section 226 retirement annuity contract.

If it is a S226/RAC then there could be guaranteed annuity rates involved and if so, the rates could be highly desirable. These would need to be costed against the benefits of buying back years as well as the death benefits. A lot of S226s didnt return fund value but returned premiums plus interest. Although rule changes over the years did see some volunteer to change death benefits to match personal pensions.

harvestmoon

I hope I haven't misled anyone. I'd like to stress that I was certainly not given false information or given incorrect pension advice. It was my choice given the circumstances at the time.To that end, I don't want that issue to cloud or overshadow my real question which is that of, looking at the figures given in my original post, am I doing the right thing transferring back into the TP or am I better off staying put?I'm really stuck and would love it if someone could ignore other issues and offer me some sound advice.What's in the past is in the past - I'm concerned with the future now.
Many thanks.

Debt_Free_Chick

harvestmoon wrote: »

I hope I haven't misled anyone. I'd like to stress that I was certainly not given false information or given incorrect pension advice. It was my choice given the circumstances at the time.To that end, I don't want that issue to cloud or overshadow my real question which is that of, looking at the figures given in my original post, am I doing the right thing transferring back into the TP or am I better off staying put?I'm really stuck and would love it if someone could ignore other issues and offer me some sound advice.What's in the past is in the past - I'm concerned with the future now.
Many thanks.

It's a difficult decision and a gamble either way. On the one hand, you get the certainty of a pension which will be five years' worth of your final salary. You'll get that "no matter what".

On the other hand, you leave it where it is and - depending on investment returns and annuity rates - you could get more.

Question is - do you want the certainty? Or are you prepared to forego the certainty for a gamble that you might get more?

harvestmoon

I come back to this every 2-3 mins hoping that someone will have posted a reply which is factual and will, without telling me what to do, will guide me towards a final decision. Is it you???? Please????I want to sleep!Thank you.

dunstonh

We cant tell you. Its impossible without the facts.

You cant have a personal pension as they didnt exist when you decided to opt out. That means you probably have a section 226 retirement annuity contract and that quite possibly means you have guaranteed annuity rates that could be as much as double current open market rates. I already mentioned this in my previous post but it in simple terms it means we need to know your contract terms to see if there are GARs or not.

DFC has already mentioned investment returns and they are unknown. We would need to know how you are invested currently, what investement options are available and what the ongoing charges are. It may be that the pension is low potential or has good potential. It may be that you dont have the risk profile required to be invested vs the benefit of a guaranteed option.

There is also the potential issue of a transfer penalty. We know how much you are getting from the transfer value but how much is that being hit compared to the current value. It may be zero or it may be £10,000. That ties in with analysis of future options.

So, no reply we can give can be factual as we dont have the facts.

DiggerUK

Harvestmoon,

If you go back into the TPS you will be able to add remaining years of service to your existing deferred years. (9 to go ?)
How many deferred years do you have ?
This will up the value of your existing years, because they should be included in whatever your final salary will be, not at what you were paid at the time.
I am assuming you have risen a few pay scales since then.
As to the question of buying the 5 additional years with the 44K Dunstonh will need more details.

(Somebody pass Dunstonh the smelling salts!!)