Is my pension forecast correct?

lizziemay

Bigmoney2 wrote: »

The final salary scheme I was a member of took off a deduction for being contracted out of serps.

So rather than just a straight 1 /60th of his final years salary x the number of years worked, there was a deduction of

lower earnings level x years service /80

Then any deduction for going before normal pension age is applied.

No idea if your pension will be the same or not.

Also the LEL figure was also averaged over the last 12 months so unless retriring on 5th April would be a bit lower than the current figure.


Salary may not be the salary at date of retiring, it could also be averaged over say the last 12months, or even 3 years depending on the scheme rules.

Cheers, I will check out the pension booklet to see what the rules are.

xylophone

The lump sum (unless you had had other plans for it) gives you around £9460 per annum (even without any interest you manage to glean) until state pension kicks in at 66?

And don't forget that the pension will be index linked.

This means that your husband will have more or less the pension he was expecting (some consolation for the abatement).

You could keep £9460 in an easy access account and then use fixed rate bonds for the rest?

Just a thought, you don't say whether your husband will continue working - make sure that his tax code(s) are correct.

lizziemay

xylophone wrote: »

The lump sum (unless you had had other plans for it) gives you around £9460 per annum (even without any interest you manage to glean) until state pension kicks in at 66?

And don't forget that the pension will be index linked.

This means that your husband will have more or less the pension he was expecting (some consolation for the abatement).

You could keep £9460 in an easy access account and then use fixed rate bonds for the rest?

Just a thought, you don't say whether your husband will continue working - make sure that his tax code(s) are correct.

He is planning on working for another 2 or 3 years, so we're looking for somewhere safe to invest the lump sum. We're also going to put away his monthly pension and the £53 that he won't have to pay in anymore...hopefully.
Fixed rate bonds sound good we will be checking them out.
Then again, we might have a dream holiday first!

Do we have to notify the tax office or will his employer do it?

geelamch

No you just go on holiday Lol

lizziemay

geelamch wrote: »

No you just go on holiday Lol

Hahaha, brilliant!

xylophone

Do we have to notify the tax office or will his employer do it?

I would strongly suggest that he notifies the tax people himself and has another word with them them when he retires and when he comes to draw his state pension.
Make sure that he keeps up with tax allowance information so that he knows what he should be paying.

I would imagine that all his allowances will be given against his salary so that the code for the pension would be BR?

I expect that you already use your ISA allowances - if not, worth considering.

lizziemay

xylophone wrote: »

I would strongly suggest that he notifies the tax people himself and has another word with them them when he retires and when he comes to draw his state pension.
Make sure that he keeps up with tax allowance information so that he knows what he should be paying.

I would imagine that all his allowances will be given against his salary so that the code for the pension would be BR?

I expect that you already use your ISA allowances - if not, worth considering.

Cheers, we'll make sure we do notify them.
We haven't got any ISA's as the kids have always kept us poor! We are finally beginning to save as the mortgage has just finished
We'll look at ISA's too.