NHS Pension Scheme

katie678

Hi!
I wonder whether anyone could help me out. I have recently been accepted for a job and wondering whether to join the NHS pension scheme. However, i am in abit of confusion as i am hoping to go to university soon.
I am hoping to apply to uni next year, which will mean i might only be in the job for 1-2 years before starting uni. My question is how would i go about the pension? Would i have to opt out / carry on paying / could i carry on with the pension scheme after i finish my nursing degree? OR should i just wait until after my degree and start the pension scheme then?
p.s i am 20 & i have NO CLUE about pensions etc ha!

Thanks!!

kidmugsy

While I will naturally bow to any NHS pension experts who comment, I will guess that you may gain handsomely by joining the pension and are exceedingly unlikely to lose by it.

Thrugelmir

There's no reason not to join.

In the years to come you'll gain a better appreciation of starting a pension now.

katie678

Thank you for your quick replies! From reading the forums etc the pension scheme has huge benefits for the future.

My main question is what would happen if i was to leave the job after starting the pension to attend uni for my nursing degree...obviously going into the nhs afterwards? Would that mean i would have to opt-out the pension and end up rejoining after uni (which i wouldn't want to do) ?

Thanks Again!

hugheskevi

My main question is what would happen if i was to leave the job after starting the pension to attend uni for my nursing degree

If you leave within 2 years of joining you would have the choice of receiving your pension contributions back (less tax and a National Insurance adjustment) or transferring the pension value to another pension scheme.

If you left more than 2 years after starting the pension would become deferred, which means however much you had built up at that point would be increased by prices until you start to draw it (many years in the future).

obviously going into the nhs afterwards

If you stay in for less than 2 years in your current employment, then you simply start again.

It is a bit more complicated if you stay in for 2 years in this employment, leave, and return - especially as the pension scheme is changing in April 2015. But the general principle is that you would leave the scheme whilst away at uni, and when you return carry on accruing pension as if you had not left (although you don't build up any pension whilst away of course).

I am hoping to apply to uni next year, which will mean i might only be in the job for 1-2 years before starting uni.

Many people think they will only be with an employer for a short period, then for whatever reason it turns out to be longer than expected.

Would that mean i would have to opt-out the pension and end up rejoining after uni (which i wouldn't want to do) ?

Not opt-out, simply leave the scheme when you leave employment. But why wouldn't you want to do this?

katie678

hugheskevi wrote: »

If you leave within 2 years of joining you would have the choice of receiving your pension contributions back (less tax and a National Insurance adjustment) or transferring the pension value to another pension scheme.

If you left more than 2 years after starting the pension would become deferred, which means however much you had built up at that point would be increased by prices until you start to draw it (many years in the future).



If you stay in for less than 2 years in your current employment, then you simply start again.

It is a bit more complicated if you stay in for 2 years in this employment, leave, and return - especially as the pension scheme is changing in April 2015. But the general principle is that you would leave the scheme whilst away at uni, and when you return carry on accruing pension as if you had not left (although you don't build up any pension whilst away of course).



Many people think they will only be with an employer for a short period, then for whatever reason it turns out to be longer than expected.



Not opt-out, simply leave the scheme when you leave employment. But why wouldn't you want to do this?

Thankyou for your reply!!
Reading around some have said it wouldn't be a good idea to leave and try to rejoin again?
Of course there is always the chance i would not get into university and then stay on in employment, which then i probably would regret not starting the pension.

Sorry if i am sounding dumb ha! If i was to leave within 2 years and recieved my contributions back, would that time i paid into it benefit me in anyway (in the future) when i decided to return/carry on after uni?

Thanks again!

hugheskevi

Reading around some have said it wouldn't be a good idea to leave and try to rejoin again?

I don't see how it could be, although I'll acknowledge the NHS isn't one of the schemes I am most familiar with. Any links?

Worth being aware that there is a lot of questionable guidance written and spoken by people with very little knowledge about pensions, so never really on anything you read about pensions unless you trust the source. For future record, ignore anything your future colleagues tell you about pensions, or at least treat it with a big pinch of salt

Secondly, there is a lot of change going on with public sector pensions, so pretty much everything is different from April 2015 (at least for younger members).

Having a very quick look at NHS literature, this looks relevant (I don't see why they wouldn't continue with this in the post 2015 scheme):

Study courses, training or approved employment
You may be able to avoid taking a disqualifying break if on leaving you:
• undertake a course of study or training, which will improve your usefulness to the NHS

You should ask us for approval as soon as possible after commencing the employment or course of study. You must also return to the NHS as soon as is reasonably practicable after finishing the employment or course. By avoiding a disqualifying break you will be able to keep all the benefits you have built up in the Scheme.

If i was to leave within 2 years and received my contributions back, would that time i paid into it benefit me in anyway (in the future) when i decided to return/carry on after uni?

No.

The purpose of the refund is to put you in the position as if you had never joined. This means the scheme doesn't have to administer lots of small pots and the individual doesn't have a lot of trivial pensions to keep track of.

atush

always try to keep your pension in a oension of some kind, Be it the great DB ones like NHS or the other type.

As if you choose to get your contributons back instead of keep/transfer, you could lose more than 50% of the value. And you wont even get back what you put in, as you would have to subtract the employers contribution (which could be half or much more) and then you would take out both income tax and NI.

which, depending on your scheme, you could lose more than 50% of what you put in yourself

katie678

Having a very quick look at NHS literature, this looks relevant (I don't see why they wouldn't continue with this in the post 2015 scheme):




No.

The purpose of the refund is to put you in the position as if you had never joined. This means the scheme doesn't have to administer lots of small pots and the individual doesn't have a lot of trivial pensions to keep track of.

Thank you Thank you! I have the printed book which was sent me, but hasn't got the part about "study courses, training or approved employment" printed in it
It has really helped me get my head around it :T Thanks again for taking the time to help me out :beer:

Teaandscones

atush wrote: »

always try to keep your pension in a oension of some kind, Be it the great DB ones like NHS or the other type.

As if you choose to get your contributons back instead of keep/transfer, you could lose more than 50% of the value. And you wont even get back what you put in, as you would have to subtract the employers contribution (which could be half or much more) and then you would take out both income tax and NI.

which, depending on your scheme, you could lose more than 50% of what you put in yourself

Agree entirely. Join the scheme, if you leave within 2 years try and get agreement to stay in as suggested earlier, but if that is not allowed don't take the refund.

System

Hi

To re-inforce some of what has been posted...

The refund of contributions may be used to put you in the position of never having joined the NHS scheme, but it may have to put you into the position of being employed.

Pension contributions are tax deductable and any refund of contributions is liable to TAX and NI.

Therefore the Scheme would have to pay the TAX and NI leaving you with any balance. Which you could avoid accepting by moving house/bank account etc etc.
The balance may accrue interest for late payment, but if you have a student loan why would you avoid the refund?