Opt out of SERPS/S2P?

westlife2810

so because i contracted out when i was 22 (which was in 1989) then there is no point in looking into a possible mis sale?

xylophone

I opted out about 20 years ago, and my pension provider wrote to me a while ago to say I would not automatically be opted back in,[/QUOTE
http://www.direct.gov.uk/prod_consum_dg/groups/dg_digitalassets/@dg/@en/@over50/documents/digitalasset/dg_195031.pdf

xylophone

Spoke with my LGPS advisor today and they confirmed that at present it is a FS scheme which is contracted out.

http://www.osborneclarke.co.uk/publications/services/pensions/update/2013/lgps-update-single-tier-state-pension.aspx

dunstonh

westlife2810 wrote: »

so because i contracted out when i was 22 (which was in 1989) then there is no point in looking into a possible mis sale?

If it was a non-advised case then there is no mis-sale. (no advice involved)
If it was a defined benefit scheme then there is no mis-sale. (no choice in matter)
If it was a money purchase scheme and advised then using the FSA guidelines for pre 1997, at age 22 you were the perfect age to contract out.

I was contracted out in the past and it has turned out to be the best thing I ever did. Whilst nowadays it is generally classed as cost neutral, the loosening up of contracted out benefits compared to contracted in means that many people are better off. e.g. contracted out has better death benefits, the ability to take a tax free lump sum (no lump sum when contracted in) and you dont have to wait until whatever state pension age that applies to you.

Perhaps rather than us looking for mis-sale reasons that may apply, it would be easier to ask why you think you have been mis-sold and what about contracting out has been wrong for you?

dunstonh

The FOS figures just published show that they only uphold 1% of SERPS complaints.

http://www.moneymarketing.co.uk/regulation/fos-complaints-jump-179-due-to-ppi-surge/1074416.article

A figure largely consistent with the FSA's findings.

johnaka

any idea as to how the government going to deduct contracted out payments from the state pension?
I opted out around 1980 .
I cashed in my pension from standard life. which had about £36,000.
will they take the whole amount into consideration inc lump sum.
as it is its about £30 a week .
does this mean it will be taken off the propose £140?
I still paid serp's from 1968 till 1980.or will this be knocked on the head.??
I will retire in november 2016.

jamesd

Those who contracted out into personal pensions automatically stopped accruing the Additional State Pension that SERPS then S2P would have provided for those years. Current pension forecasts or statements show the pension expectation with nothing added for those years.

This means that those who contracted out into a personal pension are potential winners from the proposed flat rate cut to pensions for employees. The Basic State Pension portion would still have been accruing for each year because that couldn't be contracted out of. They will be able to pay in to the flat rate system for more than 35 years to get them up to £144 a week. So unlike others, those who contracted out can get the benefit of both their personal pension and the potential to get to £144 a week of state pension.

The amount you had in the Standard Life pot makes no difference at all to how much the flat rate system will pay you. It's completely disregarded for those calculations. Just the number of years contracted out is used.

[Deleted User]

I opted out of SERPS at 18. I've only ever had low/average pay jobs. In 2007 I had to stop working due to illness and have been on sickness benefits ever since. I'm now in my early 40s. The chances of me being able to work again are extremely slim. I know virtually nothing about SERPS. What should I do? Can I opt back in again?

jem16

Ostrava wrote: »

I opted out of SERPS at 18. I've only ever had low/average pay jobs. In 2007 I had to stop working due to illness and have been on sickness benefits ever since. I'm now in my early 40s. The chances of me being able to work again are extremely slim. I know virtually nothing about SERPS. What should I do? Can I opt back in again?

Everybody has been automatically opted back in since April 2012 unless you are a member of a final salary scheme.

In your case as you are not working you are not earning any SERPS, now known as S2P.

jamesd

Under the flat rate cut to pensions for employees there is a maximum number of years that will count of 35 for those who have never contracted out. Those who contracted out can add more years until they get to £144 a week. Since you're unemployed you will be getting credits for that automatically. This means that by the time you reach a state pension age of say 69 you would probably have accumulated enough to get the full flat rate state pension plus whatever pension your contracted out money buys.