Should I transfer my Teachers Pension into the new NHS pension?

aw50s

I have about 9 years worth of Teachers Pension (old scheme - full benefits at 60). I now work in the NHS and it is unlikely i will return to teaching. Is it in my interests to transfer my Teachers Pension benefits to the new NHS scheme (full benefits at 65)? Both are final salary schemes and I have significant potential for salary growth ahead - am in my mid 40s. Will transfering my Teachers Pension Years thus linking all pension to my NHS final salary outweigh any losses from joining the newer NHS scheme which has reduced benefits? Any help much appreciated!

jamesd

It'll depend on your future income so it's really tough to predict. It's the sort of question that a well qualified IFA would charge a couple of thousand Pounds to analyse and answer and the gain to you could make it well worthwhile paying that rather than getting it wrong. Still costly, but maybe less costly than not doing it.

If you're contemplating retiring at or before age 60 then it is probably seriously worth considering leaving the money in the teacher's pension so that you can get that part to cover the years before the new NHS scheme and then the state pensions start.

It is worth checking to see if you can transfer the money into the old NHS scheme on the basis that it's old rights already. If you could do that and retain the earlier date for this bit of money, while getting the presumably higher salary link then I suspect that it would be good to move it.

You may also not get as many years after the transfer, I don't know how the two schemes value past years.

Andy_L

Get a transfer quote, without that all is speculation. As the (new) NHS pension is worse than the (old) Teachers scheme your 9 years will get you more years service in the teachers scheme (guesstimate 11-12ish years).

snowcat53

Get a quote - this should be on the 'public sector transfer club' terms - both NHSPS and the Teachers pension schemes are members. You may well get offered more than year for year to reflect the fact the NHS 2008 scheme standard retirement age is 65 rather than the TPS 60.

It does depend on how much you think your salary will grow and if you will get big promotions - try modelling various assumptions in a spreadsheet. Remember that your TPS preserved pension will add CPI to your last salary and use that figure for pension.

The other consideration is possible early retirement 'in the interests of the service' or on ill-health grounds or redundancy. Eg if you were made redundant over 55 from the NHS you would get your pension paid immediately with the number of years you had then but without actuarial reduction, and obviously extra transferred in years would help in that case (you would have to wait till 60 for the preserved teacher's pension if you left it there).