How stupid is my plan?

hyubh

Puddylove wrote: »

It's the constant increase in contributions

The slightly higher employee rate of the FS section of the USS compared to the CARE one doesn't reflect the relative cost of the two sections from the fund's point of view - the FS section's benefits are far more expensive. Check out the fund's annual reports since the CARE section came in...

together with an equally constant erosion of benefits

You aren't losing benefits already accrued - rather, the scheme just changes for future accrual every so often. In fact, arguably it would have been fairer for the CARE section to have been introduced for everyone back in 2011, similar to how changes in the LGPS have been managed.

that make me wonder if I should just be saving instead (of the VT part). Particularly as my VT roles are likely to diminish, anyway.

That almost sounds like trolling.... Plainly, you should accrue as much membership in the final salary section of the USS as you can.

Puddylove

Thanks, hyubh.

I realise that FS schemes are more expensive but I believe I will be transferred to the CARE scheme in the next few years, and that will reduce my pension.

In fact, there seem to be some suggestions that the universities (employers) are also unhappy with the employer contribution rises - but I don't know enough about it.

Regardless, I have no intention of withdrawing from the pension in my FT role.

'Trolling' - really? I've no idea where that came from. . As my VT roles are likely to diminish starting 2015 (hope not, but student numbers decide) it seemed perhaps prudent to start putting a small amount each month into long term savings, adding in the difference from salary increases every year (so maybe £150 a month, rising by £50 annually).

I'll have a rethink.
Thanks for discussing it, your time is appreciated.

mgdavid

in general, apart from pensions and investments it's recommended one should have 6 months' basic living costs in accessible savings.

hyubh

Puddylove wrote: »

Regardless, I have no intention of withdrawing from the pension in my FT role.

You seem to be conflating the fact the variable time posts earn you less FS pension in absolute terms compared to your main post with them contributing less in relative terms too. If you opt out just to put money into another form of 'long term savings', not only do you lose the very large employer subsidy for the pension contributions forgone, but you won't even have all those absent contributions to invest elsewhere given pension contributions attract tax relief.

Puddylove

mgdavid wrote: »

in general, apart from pensions and investments it's recommended one should have 6 months' basic living costs in accessible savings.

Thanks - I do have other savings (only about 3 months' at the moment) but I thought I could maybe save the smaller amount long term, try not to touch it until I retire - worthwhile or too small to bother with?

Puddylove

hyubh wrote: »

You seem to be conflating the fact the variable time posts earn you less FS pension in absolute terms compared to your main post with them contributing less in relative terms too. If you opt out just to put money into another form of 'long term savings', not only do you lose the very large employer subsidy for the pension contributions forgone, but you won't even have all those absent contributions to invest elsewhere given pension contributions attract tax relief.

My FT pension payments buy me years, and (at present) set my FS.
My VT pension payments buy me years.

I understand both the tax (salary sacrifice) and employer contributions. Soon I may have no VT payments.

I suppose I am concerned by changes in the benefits I will receive - I wouldn't be the first person whose pension failed to materialise.

mgdavid

Puddylove wrote: »

........
I suppose I am concerned by changes in the benefits I will receive - I wouldn't be the first person whose pension failed to materialise.

can you name a single example from the public / state sector?

hyubh

Puddylove wrote: »

My VT pension payments buy me years.

So... great! I am really failing to understand your teeth gnashing - you understand those years earned cost the pension fund (and so your employer) far more than yourself, right?

I understand both the tax (salary sacrifice) and employer contributions.

You sure? 'Salary sacrifice' is highly unlikely to be the mechanism through which you contribute to the USS.

Soon I may have no VT payments.

If true, how does the question of opting out even arise?

I wouldn't be the first person whose pension failed to materialise.

What on earth are you talking about? If you want to opt out and (in a small way) save the USS an additional pension liability, go ahead - if the pension fund could speak, it would thank you for it.

hyubh

mgdavid wrote: »

can you name a single example from the public / state sector?

Well, the USS itself is not in 'the public/state sector' even if the vast majority of its participating employers are public not private universities. Your general point is a reasonable one though, short of the USS collapsing under its FS liabilities and entering the PPF...

Puddylove

I appreciate your thoughts.
Can you clarify your comment regarding salary sacrifice, please?