BT Pension

Fernackerpan

How safe is my bt pension ?
I am 57 years old and looking to retire at 60,however i have the opportunity to withdraw my pension now and carry on working untill retirement age.therefore should i withdraw my pension now.

yelf

well it depends what BT pension it is: when did you join the company?

Fernackerpan

I joined the company in dec 87.

My pension is called a final salary pension

Pollycat

Has there been any talk/whispers about closing the BT final salary pension?

I know Royal Mail have already done this.

Loughton_Monkey

This smells to me like a very shabby trick to save money. The minute you choose to take the pension based on years of service up to now, BT have managed to "cap" their liabilities - except for small costs of providing you with a much smaller new pension for your remaining service.

A lot depends upon what pay rises you might receive between now and retirement. If, for example, it would be 10% higher, then BT will have to add 10% to your existing final salary pot. In many cases, the cost of this to them could approach a year's salary!

It's difficult to be more precise without exact terms & conditions of the offer. But I strongly suggest you don't rush to accept it without full examination. You may be costing yourself a fortune. Also, you could run the risk of putting yourself in a higher tax bracket for the next 3 years by earning a substantial pension, plus your continued salary.

dunstonh

should i withdraw my pension now.

That is something we cant answer for you. It depends on your financial circumstances (tax, savings, liabilities, spouse provision etc) and how much you would lose against how much you would gain with any alternative.

I doubt it is something you can get answered on the internet as you would have to disclose too much personal information and it would require a fair bit of analysis.

Fernackerpan

yes i have been told dec 2011 it closes.

Browntoa

a friend of mine has used a planner on the pension part of the BT intranet , shows the effect on your pension of doing various things including this

chris_m

Fernackerpan wrote: »

yes i have been told dec 2011 it closes.

I'd check that carefully if I were you. I'm on holiday at present so don't have access to the documentation we were given last year but the date you have of Dec'11 sounds to me like the end of an easement period that was offered for people retiring and leaving the company completely by 2012 with no change to the previous pension arrangements.

For the rest of us who were in it (i.e. not those on the more recent money purchase scheme), the final salary scheme, as it was, closed in April last year - with benefits earned to that date being protected (and still final-salary based) and all subsequent benefits being accumulated on a career-average basis rather than final salary.

Browntoa's suggestion is worth following up - it's a pretty good forecasting tool on the HR site, although last time I looked (a few weeks ago) it hadn't yet been updated to take into account the 2010-12 pay deal - so the figures quoted may well be a little bit under what we should be able to expect. It is only intended to be a guideline though, for definite figures you'd have to ask the HR pensions people.

HTH
Chris