new to proper jobs and pensions...

xylophone

See http://www.pensionsworld.co.uk/pw/article/salary-sacrifice-win-win-scenario-1234841

"Contributions are treated as employer contributions and are not eligible for refunds (to employees) on leaving service of an occupational pension scheme with less than two years’ pensionable service."

Does the scheme permit you to opt out of salary sacrifice if you wish?

Where benefits are left deferred, they revalue in deferment and you can draw them at the Scheme's Normal Retirement Age (or with consent at an earlier age but with actuarial reduction).

hyubh

xylophone wrote: »

Does the scheme permit you to opt out of salary sacrifice if you wish?

As it's the USS, the scheme's not the problem if salary sacrifice isn't desired - rather, it will be the employer. More exactly, the scheme (since 2007) allows employers the option of operating salary sacrifice for regular scheme contributions, so whether salary sacrifice is used or not is a matter between the individual member and their employer, rather than the member and the scheme:

http://www.uss.co.uk/schemerules/schemerules2140/Pages/38Salarysacrifice.aspx

http://www.uss.co.uk/Factsheet%20List/Factsheet%2026-%20Salary%20Sacrifice%20FS.pdf

wallofbeans

Salary Sacrifice is optional. They sent me a whole different booklet on why that is the best way to go. I thought it seemed like all pros but you're saying there are cons too?

atush

The only con I can see, is if you leave your job with less than 2 years service. You want to do this?

Otherwise, it means it saves you NI as well as BRT.

I'd stay in it, and if you leave in future, leave it to grow with inflation.

xylophone

They sent me a whole different booklet

Have you read it?

wallofbeans

I'll see how it goes. It's not the job I want to do for the rest of my life for sure. It's part time and I'll keep doing it until the other half of my work takes off that I cant do both. My other work is freelance so this job is good for regular income. So I might leave in less than 2 years but I also might not...

I'm not sure I'm clear on exactly what the con is if I leave in less than two years..?

atush wrote: »

The only con I can see, is if you leave your job with less than 2 years service. You want to do this?

Otherwise, it means it saves you NI as well as BRT.

I'd stay in it, and if you leave in future, leave it to grow with inflation.

wallofbeans

Yep. But only some of it makes sense to me. Some of it doesn't. It might well explain all this stuff but I need idiot proof language to get my head around it.

xylophone wrote: »

Have you read it?

xylophone

Yep. But only some of it makes sense to me. Some of it doesn't. It might well explain all this stuff but I need idiot proof language to get my head around it.

Does it give the cons as well as the pros? Example https://www.pensionplaypen.com/top-thinking/show/395/pension-salary-sacrifice-is-it-worth-it.html#.VeRPntNViko

wallofbeans

xylophone wrote: »

Does it give the cons as well as the pros? Example https://www.pensionplaypen.com/top-thinking/show/395/pension-salary-sacrifice-is-it-worth-it.html#.VeRPntNViko

They mention all this and always use the full salary amount when asked for mortgages etc. so that is all good.

It's still just the 'refund of contributions' but that is a worry. I've never been in a proper job before so never had to wonder if I'll stay doing something for 2 years or more.

So, does this mean that I'd be giving them money and if I left the job before two years it's gone completely? Or that it just has to sit in the pension scheme and I can't have it back? Or something else?

wallofbeans

I looked at the booklet again and, now understanding more, it's starting to make sense!

They say that if you leave the job or the scheme after two years, it's no different than any other scheme. But if you leave before that and don't have benefits transferred from previous pension schemes (which I don't) there could be changes that affect you--

Leaving with 0-3 months membership: you'll receive a payment of an amount equivalant to your (employee only) pension contributions, less tax and NI.

Leaving with 3 - 24 months membership: your benefits will be preserved and you will have the option to either transfer this to an alternative pension arrangement or leave it in USS until you retire.

My questions are -

If the money stays with USS then does it make interest or just stay the exact same amount?

If I went back to full time freelance, is it easy enough to set up a pension scheme that it could be transferred into?