Final Salary Pension against more take home

aylithuk

Hi Guys

I work for a main high street bank and one of the main reason I stay with them is because they offer FSP. My current take home in cash is 20200 however if I stop with my FSP it would take it up to 25500.

I am currently thinking is it worth leaving this company but I doubt I'll find another company offering such a good FPS scheme and I am just wondering if people think state holder pensions are just as good now?

Any views?
A

MrChips

That's a very considerable employee contribution - about 20%. Is this definitely correct?

The only arrangements where I've seen this before are where employees have a flex fund, and the whole cost of the contribution is taken out of this.

dunstonh

I am just wondering if people think state holder pensions are just as good now?

No such thing as a stateholder pension. You either mean state pension or stakeholder pension. The former you get anyway and the second one is just one of three different types of mainstream personal pension.

How have you worked out how much your take home pay will go up by? Have you taken into account tax relief and an increase in NI you will need to pay?

MikeJones_2

Hi aylithuk,

And don't forget that the bank's defined benefit scheme may also provide, in addition to your pension, one or more of the following:

- a spouse's pension on your death before and/or during retirement
- childrens' or dependants' pension
- an ill health provision
- a death in service lump sum
- a pension which escalates in payment
- a degree of security (an underlying 'promise' of a pension)
- some degree of backup if the sponsoring employer fails (The Pension Protection Fund)
- the ability to transfer your pension at a later date if this suits your circumstances at that time.

You might also be interested to read an article which appeared in today's press. See:

- DC pots worth less than cash contributions

Food for thought.

Mike

I work in the field of Pension Education and Pension Guidance in the UK. I am a member of the Specialist Pensions Forum as well as being a Voluntary Adviser for The Pensions Advisory Service. I work with scheme members, employers, trustees, scheme administrators and advisers on most things to do with employer sponsored pension schemes. The views expressed by me in this thread are my personal opinions. You should seek professional advice from an appropriately experienced and qualified adviser. I am not an IFA.

AliceBanned

Isn't your employer contributing a sum into your pension in addition to your payments? If they are then it is clearly worth more than your cash; most employers at least double the amount you pay in on top of your contribution.

aylithuk

MrChips wrote: »

That's a very considerable employee contribution - about 20%. Is this definitely correct?

The only arrangements where I've seen this before are where employees have a flex fund, and the whole cost of the contribution is taken out of this.

Might help that I didn't pick up my lastest pay slip that inclu a top up.

My company pays 252.00 into the FSP so that makes a bit more sense.

A x

aylithuk

MikeJones wrote: »

Hi aylithuk,


- DC pots worth less than cash contributions

Food for thought.

Mike

I work in the field of Pension Education and Pension Guidance in the UK. I am a member of the Specialist Pensions Forum as well as being a Voluntary Adviser for The Pensions Advisory Service. I work with scheme members, employers, trustees, scheme administrators and advisers on most things to do with employer sponsored pension schemes. The views expressed by me in this thread are my personal opinions. You should seek professional advice from an appropriately experienced and qualified adviser. I am not an IFA.

Thanks Mike

Gotta read the link and make some choices. I think after I tax the 252 that my company pays into the FSP scheme I don't think it will be worth it anyhow to do the stop but we'll see

A