Final salary council scheme, new job..stick or?

clairehi

Hi as Carol is away can I step in here. Please note that the below applies to people transferring pensions within the public sector transfer club where you get the same number of years service in the new scheme as you would have in the old scheme.

As Carol has said, it will only benefit your sister to transfer in her old contributions if her new salary is higher in future than her old job. This is because the pension is calculated as a proportion of your final salary when you leave the scheme or at retirement.

most people will therefore benefit from a transfer as they earn more later on in their career. Even if your sisters job is the same pay as the old job or or is just slightly less, as long as she gets payrises in future it is still probably a good idea to transfer.

however if she moved to another job which was lower paid and never got back up to the same pay as the old job before retirement, she would lose out if she transferred your old pension.

This wont apply to your sister if she is staying in the same overall scheme, but other people transferring between different public sector schemes also need to check other issues such as death benefits, spouse's pension, whether it is a 1/80 or 1/60 th scheme etc.

A_Nice_Englishman

clairehi wrote:

Hi as Carol is away can I step in here. Please note that the below applies to people transferring pensions within the public sector transfer club where you get the same number of years service in the new scheme as you would have in the old scheme.

So as a member of a public sector scheme on a modest salary it would pay me to move to the highest paid job I could find a year or two before retirement? Is the LGPS within the transfer club?

Andy_L

clairehi wrote:

Hi as Carol is away can I step in here. Please note that the below applies to people transferring pensions within the public sector transfer club where you get the same number of years service in the new scheme as you would have in the old scheme.

It's not necessarly a 1 for 1, it allows for differances in scheme rules (eg Police Scheme allows retirement at 55, Civil service at 60).
However it's a fair value based on the true cost of the benefits rather than the state of the fund as would be the case in a private sector scheme.

Andy_L

A_Nice_Englishman wrote:

So as a member of a public sector scheme on a modest salary it would pay me to move to the highest paid job I could find a year or two before retirement? Is the LGPS within the transfer club?

Probably, however if you change employers (eg civil service to Local Gov) you may loose your current retirement age of 60 as the schemes are in the process of being changed for new employees.

Heres a list of members
http://www.civilservice-pensions.gov.uk/upload/assets/www.civilservice_pensions.gov.uk/club_list_aug06.pdf
The LGPS is (currently) a member