NHS Pension & AVC

keep_it_simple

Your help is most welcome, thank you.

No I hadn't thought of a leave of absence.

Don't know how we'd manage financially mind you.

I think I can take retirement from 50 according to their scheme booklet but can't anyway due to mortgage, etc.

Thanks again.

xylophone

but can I also suggest that you don't burn your boats?

I would second this - if you retired, would you turn in on yourself? Developing clinical depression could be the result? You might perhaps find the daily grind more bearable if you think of your job as a kind of therapy that keeps you looking out and making a better life for your remaining child?

keep_it_simple

Thanks for your reply.

I have clinical depression, which makes the job worse.

I suppose that's why I'm looking for a get out.

atush

Making a life long decision over a (hopefully) short term condition is not the way to go. Take any leave you are allowed such as holiday.

Don't pay off your mtg, as the rate is Very low. Save into S&S isas, maybe a pp too. This is to fund any eventual early retirement, so that you don't have to take your pension reduced.

AP is a good deal, but given you are thinking of retiring early and taking an actuarial reduction, this could be a waste?

keep_it_simple

I could work as an Agency Nurse and get paid more per hour but I can't pay that into my NHS pension. But I could pay more of my NHS wage into the NHS pension. And live on Agency wage.

I'd have to keep working for the NHS to keep funding my pension.

jem16

keep_it_simple wrote: »

Hi, this is the bit that made me think I can take my AP as my Lump Sum and have a bigger pension,

Can someone explain please?

Increasing Your Benefits Additional Pension (AP)
AP is a flexible way of increasing your Scheme pension. It allows you to choose to buy extra annual pension and see clearly how much the purchase will cost.

In your first post you weren't asking about AP, you were asking about AVCs which are entirely different.

Basically there are two ways to increase your retirement benefits with the NHS.

One is to use AVCs. This is the money purchase option and your AVC is used to buy funds which are then invested. The return on these are not guaranteed and will rise and fall depending on how they are invested. With the AVC pot through the NHS you can then take 25% as a tax-free lump sum and use the rest to buy an annuity - ie a monthly income.

The second method is to buy Additional Pension. This buys an amount of pension and is guaranteed just like your main pension benefits. If you wish you can commute some of your pension ( including the AP) to take a tax-free lump sum up to 25%. However this is not a sensible option as the commutation rate of 12:1 is dire and you are better off with the pension.

As you are a member of the 1995 scheme you will receive an automatic lump sum of 3 times the annual pension. You can commute more up to 25% but as I said earlier it's not a good idea to do this.

If you retire early your AP will be reduced as well as your main scheme.

jackyann

Hello k-i-s
This is going "off topic" but here goes:

If you have depression, have you already taken sick leave? I really recommend taking the maximum that you possibly can. First of all to just look after yourself, then to see if you can regain the strength to return.

Have you spoken to your manager about a temporary change of role? Continuing to work as a nurse is very hard in the circumstances you have described.

You seemed to think the idea of a leave of absence might work if you could afford it. Could you approach your mortgage provider to discuss a "mortgage holiday"? I have known this happen in just these circumstances. However, look carefully as you may not get back on the same rate.

It is impossible to tell from posts on a forum like this, but I think that feeling like walking away is very understandable at present - and indeed is probably the right thing for your mental health. But as that improves, you may find that you want to return, so leaving the door open would be a good thing.

I do hope you find a way through this.

keep_it_simple

I see . That's much clearer, I did say most pension rules are beyond me. I have to take them to bits line by line !

Thanks for the info, so it looks like the best plan for me is to buy AP, retire at 60 and take my lump sum and no more.

By the way do I have to take all my lump sum ?

I can't work out how much Ill get, if I buy AP and retire at 60.

It seems a very long way off and I don't know if I can take it for 8 more years.

Is it worth transferring a previous pension in ? It's only around £700 !
But every little helps !

Thank you for all your advice.

keep_it_simple

Hi,

Yes I've had all the sick leave I could.
I had to go back after 15 months off .

I could not extend my mortgage as that's the only thing that's keeping me at work so as soon as it's paid, I'm off !

I have reduced my working hours and only work part time now .

We couldn't manage on my OH wage only, I'm kidding myself by thinking I could.

Thanks again .

jem16

keep_it_simple wrote: »

By the way do I have to take all my lump sum ?

In your case, yes. The 1995 section comes with an automatic lump sum. The 2008 section comes with a higher pension and the ability to commute for the lump sum.

I can't work out how much Ill get, if I buy AP and retire at 60.

Your normal pension would be 19/80ths of final salary. So if you earned £30k the pension would be £7125. The lump sum would be 3 times that so £21,375.

The AP is obviously how much you elect to purchase.

Is it worth transferring a previous pension in ? It's only around £700 !
But every little helps !

It probably would have been beneficial but transfers must be done within the first 12 months of joining.