NHS PENSION ADVICE ?.....please

karlos_the_jackal

jem16 wrote: »

Based on a final salary of £32k and assuming you are in the 1995 section - the calculation would be 12/80ths of £32k. That would give an annual pension of £4800 plus automatic lump sum of £14,400.

I'm struggling to get your figures - have you more than 12 years service?

It could be even lower. £32k total earnings suggests a Band 5 nurse with some overtime/allowances added on which usually aren't pensionable. Band 5 tops out at £28k and the pension would be based on that.

Notfarfromtheborder

Maybe OP has reduced banding / hrs. Isn't 1995 scheme based on the best of the final 3 years?

RABC

Regarding the NHS pension, been thinking of cashing mine in but I have doubts as ive a few workmates that have taken there pensions and have found that when they were paid there lumpsum it was less than what they were told they would get, my question is before I sign for my pension should I be given an exact set of figures as to what I shall receive. Appreciate any help.

Maelwys

christabelle23 wrote: »

I'm 60 in December this year and have been paying into nhs pension only for 12 years. I have worked out lump sum which is roughly about £34,000 with a small pension of around £6000 per year.

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My earnings last year were approx £32,000.

As others above have pointed out, those numbers really don't add up.

Plug your Age and Pay Band and Years of Scheme Enrollment into the calculator at http://dh.firstactuarial.co.uk/default.aspx and see what it comes up with.

I suspect you'll be looking at something closer to a £5k pension with a £15k Lump Sum.

In any case, the NHS pension isn't really worth deferring (unlike the State Pension), has pretty heavy actuarial reductions for taking it early and has a poor 1:12 lump sum commutation rate... so you're usually best served taking the highest amount of pension and least amount of lump sum that they'll give you.

I'd suggest leaving the NHS pension as-is and playing about with your DC Aegon pension instead. You could take the 25% Tax-Free Lump Sum at any point during retirement, and then draw down on the pot over the next few years (providing that doing so won't push you into the next tax bracket) in order to supplement your NHS pension until you hit your State Pension Age. If Aegon won't let you draw down on your pension with them (worth checking with them since this is very possible) then you can move your pot to another pension provider which will.

Maelwys

RABC wrote: »

Regarding the NHS pension, been thinking of cashing mine in but I have doubts as ive a few workmates that have taken there pensions and have found that when they were paid there lumpsum it was less than what they were told they would get, my question is before I sign for my pension should I be given an exact set of figures as to what I shall receive. Appreciate any help.

You should be able to request an up to date "estimate" from them directly - see http://www.nhsbsa.nhs.uk/Pensions/4193.aspx

From what I've seen the accuracy of the official estimates is usually fairly good, but payroll staff at a more local level tend to be a little more... confused... about the different schemes (and particularly switchover dates) which can lead to them giving inaccurate advice or estimates.

As mentioned previously, the commutation rate for NHS pensions is 1:12 which is dire. So for maximum value for money you really want as low a Lump Sum and as high an "Annuity" as possible unless you're planning to die within the next ten years or so with no living spouse or dependants.

RABC

Ive received an estimate but before I sign away my pension do I not get an exact set of figures showing what I shall be getting, what happens if there estimate is wrong and I end up £5000 short because there estimation is wrong.

PennyForThem_2

I am in 95 pension for NHS.

I am still working at 64 (female) as not got anywhere near 40 years - I have 27 years.

NHS pension is complex as I have found - for me I can work up to 75 and still earn pension as long as I don't retire (and come back) or 'change my job and salary - unless salary goes up'.

Contact the NHS Pensions (not local - sorry they are a waste of time mostly) - state what you want to do and see what they come up with.

System

Hi

Since the Scheme has a formula, then the payouts/value/etc will conform to said formula.

If it it an 80ths scheme, then it is simple to calculate...

Date you joined
Date you left

This gives the length of membership.

This could be shown on the following format YY/DDD ie: 12/200
Twelve years 200 days.

If you have had part time working then a proportion is calculated for those periods.

EG: 03/123 doing 10/37

For 3 years and 123 days you did 10 hours per week. So...

03/123 length of membership, service accrued 00/329

That period got you less than a year of service, 10/37ths in fact.

Now your membership is still 12/200, but your service is 09/077 + 00/329
12/200 membership 10/041 service.


The formula might be

SExSY / 80

ServicE times SalarY divided by 80.

10/041 is 10.112328 years times £28,00.00 = 283145.18
Divided by 80 giving an annual pension of....£3539.31

Your basic lump is basically 3 times the pension £10,617.93

So the crucially important part of the above is

When you joined and for how long.
Whole Time or Part Time (or combinations)

Those dates are critical to the accuracy of the calculation, not the actual formula bit. The salary part is usually your leaving salary.