Should I Put Money Into Nhs Pension

SMARTY29A_2

Looking for a bit of advice

I am 37, married with 2 kids and work for the NHS. At the moment (from a job previously i opted out of SERPS) but i am wondering whether it would be worth joining NHS pension scheme.

At present I get my wages and also dividends from husbands company so it means i am paying tax at the higher level (32% dividend level) so i was wondering if it was worht plouging wages (NHS) into NHS scheme

Any advice welcomed?

Happy_frank

Is the NHS scheme a final salary scheme like local goverment, if yes then sign up now. You will never beat a final salary based scheme with any private pension.

SMARTY29A_2

yes as far as i know the NHS is a final scheme

EdInvestor

Definitely a good idea to join the NHS scheme.

greengrass

Hi

I also pay into NHS pension, it a very good one to be in, I would definately go for it, I dont look for another job because of the pension.

SMARTY29A_2

am i right in thinking i pay 6% of wages and they pay something, and can i put in any lump sums??

dunstonh

am i right in thinking i pay 6% of wages and they pay something, and can i put in any lump sums??

No. You pay in 6% and upon retirement the Govt pays the pension which is funded by the taxpayer.

You need to enquire what you get for payments you make before you make them. It may or may not be cost effective.

mbamick

SMARTY29A wrote:

am i right in thinking i pay 6% of wages and they pay something, and can i put in any lump sums??

Details of the NHS Pension Scheme can be found below.
http://www.nhspa.gov.uk/site/Library/Web_EAGuide/introduction.pdf

It suggests that you are correct, insofar that EMPLOYEES pay 6%;
It also suggests that EMPLOYEES pay 7% [DUNSTONH please note].

Your annual pension will be 1/80th of your final year's pensionable pay for each year of Scheme membership. Part years of membership will also count towards your pension on a proportional basis. This will usually be paid monthly for the rest of your life.

Your [tax-free] lump sum will normally be 3 times the amount of your yearly pension.

More info at http://www.nhspa.gov.uk/site/Advice/Current/MemberGuides/SchemeGuide_SDGuide/sdguide.pdf

firesidemaid

like the previous posters say - have a look at the scheme in more detail - on the net, ask payroll for a copy of the booklet, or give them a ring.

it has changed slightly recently. i have been in it for years, but if you joined after, i think, june last year it is slightly different but almost as good. i think you have to retire now at 65, rather than 60 - but you can take early retirement.

also, if you are a scheme member it includes x2 your salary as life insurance and also ill-health benefits after 2 years.

you can also step in and out of it - i'm all for it. i'm glad i chose to join - the last 18 years have passed very quickly.....:eek:

dunstonh

It suggests that you are correct, insofar that EMPLOYEES pay 6%;
It also suggests that EMPLOYEES pay 7% [DUNSTONH please note].

There is no retirement fund at the end that pays the pension. The pension is paid for by taxpayers at that time. What the employer pays is irrelevant to the individual.

The public sector pensions account for around 20% of the Govts payout on pensions.

mbamick

dunstonh wrote:

There is no retirement fund.....The pension is paid for by taxpayers at that time.

Hi Dunstonh. I don't dispute the facts cited above, but the question was whether the employee also pays into the Pension Fund. The answer to that question is "Yes" rather than "No".

dunstonh wrote:

...What the employer pays is irrelevant to the individual.

.

Agreed, in respect of the pension entitlements accruing over time. But we should consider an employees motivation to work, and the need to feel valued by the employer. It is for this reason that I'd suggest that making Employer contributions becomes important, rather than irrelevant.

We are probably starting to go off topic now; I suspect that Smarty has the pointer that was needed. Have a good day.
Mick