Advice on new police pension please

Alex12

Hi there

I appreciate that the Police pension is a very good scheme, however I was just looking for some advice in relation to the impending changes to it.

I am in the 1987 scheme but only have 12 years service. I understand that when the new scheme begins, in 2015, all that I have accrued, under the 1987 scheme, remains in one "pot" and my new scheme in another "pot".

Can I ask if the funds in my 1987 "pot" are linked to inflation or similar as when the new scheme begins I will 27 years until my retirement date.

Would it be worthwhile to transfer my 1987 "pot" to a private pension as it will be sitting still/only earning inflation for 27 years?

Hope this makes sense. Any advice would be greatly appreciated.

Blackbeard_of_Perranporth

It is normal, Officer, that your previous scheme will be left at that, any new contributions will be in your new scheme. See your Union reps for more advice.

bigadaj

Alex12 wrote: »

Hi there

I appreciate that the Police pension is a very good scheme, however I was just looking for some advice in relation to the impending changes to it.

I am in the 1987 scheme but only have 12 years service. I understand that when the new scheme begins, in 2015, all that I have accrued, under the 1987 scheme, remains in one "pot" and my new scheme in another "pot".

Can I ask if the funds in my 1987 "pot" are linked to inflation or similar as when the new scheme begins I will 27 years until my retirement date.

Would it be worthwhile to transfer my 1987 "pot" to a private pension as it will be sitting still/only earning inflation for 27 years?

Hope this makes sense. Any advice would be greatly appreciated.

As a taxpayer I should be encouraging you to transfer your pension out, but as well as it being one of the best financial products around you wouldn't be allowed to transfer out as you'd need to get an ifa to sign it off, and no one would.

Leave that pot alone and you'll get a far better pension than any that is commercially available in the open market.

Alex12

Thanks for your replies. Can I just confirm if my 1987 pot is linked to inflation for the 27 years?

CLAPTON

Alex12 wrote: »

Thanks for your replies. Can I just confirm if my 1987 pot is linked to inflation for the 27 years?

you don't have a pension pot; you are lucky enough to have defined benefits ... which are index linked

atush

I don't know the answer, but suspect that would be the minimum- index linked.

It might be linked to your ongoing salary increases as your service will be continuous- you'd need to ask HR?

jimi_man

Hi

It still remains a final salary pension, which means that the proportion of pension that you have built up so far (in your case 12-13 years) will be used to calculate your pension, based on your salary when you retire. So, say you have accrued 13/60 pension by the time it changes in 2015, then you finally retire after 30-40 years service, then that fraction is applied to your salary at that future time and that's your pension.

Furthermore, assuming you join the 2015 pension and you complete 30 years service overall, then the fraction becomes better - 13/45, to take advantage of one of the anomalies in the scheme - 'double accrual'. This is the expectation that after 20 years you will accrue 2/60 a year instead of 1/60 in the old 87 scheme. They have allowed for this, hence why the 60ths become 45ths if you complete 30+ years service.

Hope that's reasonably clear.

Alex12

Great. Thank you all very much for your replies.

jamesd

It's definitely not best to transfer that 87 pot unless you find that you're diagnosed with a medical condition that gives you less than a year to live or find yourself with dramatically reduced life expectancy nearer to retirement. Those two are the most common cases where a transfer can be beneficial, though I haven't looked into the police pension death benefits and they might be better than transferring.

While there are things to dislike about the changes that pot is going to be handled well, so try not to be too unhappy with your lot - you're still in a very good position compared to most.

If you haven't done it yet you might try a search for police in this section and read some of the other discussions. Those might answer some other questions you have or which haven't occurred to you yet.

Alex12

Thanks very much James.