NHS Pension scheme. Advice needed.

Chasabi

Hi everyone. I am in need of advice regarding my NHS Pension.

I worked for the NHS around 6 months ago for almost 2 years. During that 2 years I was paying into an NHS pension scheme (which I have heard is one of the best around). 6 months ago I started a new job with a different company which also has a pension scheme which I have joined.

I'm unsure now what I do with my NHS pension. I understand I can transfer the balance to my new pension. I have phoned multiple people including the NHS pension agency, a free financial advisor and the people the provide the penison at my current place of work. Each person I have talked to has told me I have to speak with one of the other people I have talked to already. One will say "you need to speak with your pension provider" then my pension provider will say "you need to speak with the NHS pension agency". I'm going round in circles!

What is my best course of action? Someone mentioned leaving the NHS pension where it is but I don't see the point. There is only 18 months worth of payments in the pot and I dont work for the NHS anymore so I'm not paying anything else into it. I may as well transfer the balance over to my new pension right?

Thanks in advance for any replies.

dunstonh

I'm unsure now what I do with my NHS pension. I understand I can transfer the balance to my new pension. I have phoned multiple people including the NHS pension agency, a free financial advisor and the people the provide the penison at my current place of work. Each person I have talked to has told me I have to speak with one of the other people I have talked to already. One will say "you need to speak with your pension provider" then my pension provider will say "you need to speak with the NHS pension agency". I'm going round in circles!

The problem is that most of those people are unable to give personal advice. Just generic information. If you are asking "what should I do" questions then they cannot answer. Most financial advisers are not authorised to provide defined benefit pension transfer advice. You need an IFA for that.

What is my best course of action?

We are going to have the same problem here in that we cant tell you what is best as we dont have your details.

Someone mentioned leaving the NHS pension where it is but I don't see the point.

Statistically, the odds are that it is the best option.

There is only 18 months worth of payments in the pot and I dont work for the NHS anymore so I'm not paying anything else into it. I may as well transfer the balance over to my new pension right?

Wrong. Can the alternative you transfer into match or improve upon the benefits provided by the NHS scheme you were in? If yes, then it can be worth considering. If no, then not.

You will probably find you wont be able to do anything without an IFA anyway as most individual and group schemes require an IFA to sign off on defined benefit pension transfers. Is your new scheme or Group personal pension or a contracted in/out money purchase pension or a defined benefit pension scheme?

EdGasket

Re. 'You will probably find you wont be able to do anything without an IFA anyway'
....and that is exactly what is wrong with pensions ! A gravy train for financial advisors and hangers-on. Why should people have to pay IFAs to tell them what they already know and want to do? The IFA fees in this case will outweigh the benefit of any advice on the value of just 18 months of contributions.

Cautious_Investor_3

EdGasket wrote: »

Re. 'You will probably find you wont be able to do anything without an IFA anyway'
....and that is exactly what is wrong with pensions ! A gravy train for financial advisors and hangers-on. Why should people have to pay IFAs to tell them what they already know and want to do? The IFA fees in this case will outweigh the benefit of any advice on the value of just 18 months of contributions.

Hold on a second. I cannot let that go without comment.

1. The reason she will not be able to do anything without an IFA is to ensure that she recieves appropriate advice, transfering from a final salary pension is a serious matter, with potential loss of guarantees if it is done incorrectly

2. The reason some people need to pay IFAs is to ensure that they get the correct advice and to be frank sometimes "save them from themselves"

3. Pensions are certainly not a gravy train for IFAs, the industry has changed significantly over the past few years and it is time to stand up and address some of the old prejudices that still exist.

The Cautious Investor

dunstonh

....and that is exactly what is wrong with pensions ! A gravy train for financial advisors and hangers-on. Why should people have to pay IFAs to tell them what they already know and want to do?

Its not pensions specifically that is the problem. Its the fear of legal action from the consumer or action from the regulator.

9 out 10 defined benefit schemes are best not to be transferred. The FSA has said that it would treat a defined occupational transfer as a mis-sale as the default unless proven otherwise and they include direct offer/execution only in that as well. So, if the new scheme accepts the transfer without checking whether its best to do it, they are liable for compensation. To be able to check it is suitable you have to comply with the know your client rules and have the necessary qualifications to do the transaction. In reality, that doesnt mean it has to be an IFA but it is IFAs who logically meet those requirements.

The IFA fees in this case will outweigh the benefit of any advice on the value of just 18 months of contributions.

Quite probably. However, chances are that cost of getting it wrong would be more expensive than using an IFA as well.

mjm3346

If you have less than 2 years service you may find your options are only to transfer or get a refund. (one would expect the transfer value should be a better option than getting a refund)


Section 25 of the guide refers


http://www.nhsbsa.nhs.uk/Documents/Pensions/SD_Guide_(V4)_BandW_-_12.2009.pdf

If you have less than 2 years’ membership and wish to request a quotation of the
amount that could be payable to another registered pension scheme and the amount of contribution refund you could receive instead please fill in the form at the back of this booklet and send it to NHS Pensions.

Chasabi

Damn this is way more complicated than I thought. I'm only 24 so don't really care about a pension but I have always been told by my wiser-than-me parents to accept the offer of a pension which I do. I don't really understand a pension. I just figure it is like a savings account that I and my company pay money into and then when I retire I get paid the money back! I'm probably being completely naive.

All I want is one place where I am paying money into that will see me safe when I retire, thats what I thought a pension was. I don't like the thought of having these little pots of my money dotted arround and I can't do nothing with it unless I fork out in excess of £1000 for a financial advisor which is certainly not going to happen at my age! I wouldn't even know what I'd be paying for!

I'm worried that I'm going to lose the money I've paid into my NHS pension and from what I've read so far I'm seriously doubting why I'm even paying into a pension. If I leave this job in a few years and my new company offers me a pension then I will have 3 random pots of my money that I can't control. This is all way over my head!

Chasabi

Cautious_Investor wrote: »

1. The reason she will not be able to do anything......

The Cautious Investor

P.S. I'm a he

dunstonh

I'm only 24 so don't really care about a pension

At 24, pension planning is very affordable and its these years when you are so far away that can make the most difference.

It also doesnt take long before 24 becomes 34 and 44 etc Time speeds up as you get older. When you are 34 or 44 you will regret not taking a greater interest in pensions when you were 24.

I'm worried that I'm going to lose the money I've paid into my NHS pension

Are you really that bad on personal responsibility and admin?

from what I've read so far I'm seriously doubting why I'm even paying into a pension.

Its your life but if you want to ruin it by having no retirement provision then its your choice. I would also suggest you amend your reading material as its clearly pushing you in the wrong direction.

mjm3346

The form you need to complete to find out about your NHS pension is hardly time consuming to complete.
The information about leaving the NHS pension scheme seems quite clear on their website.

http://www.nhsbsa.nhs.uk/Pensions/2663.aspx

NHS Pension Scheme - Request for quotations
Only complete this form if you have less than 2 years' NHS Scheme membership.
I understand that the NHS Scheme allows members to add together periods of membership of less
than 12 months apart.
I request quotations of the transfer amount that could be payable to another registered pension
scheme and the amount of contribution refund I could receive instead.
My details are:
Title Mr Mrs Miss Dr
Name
Scheme reference no. SD /
National Insurance No.
Date of birth / /
Address for correspondence
Name and address of last NHS employer
Date of leaving / /

Once completed please send

as soon as possible to:
NHS Pensions, Hesketh House, 200-220 Broadway, Fleetwood, Lancashire, FY7 8LG