old DB pension

RuleTheWorld

That is the pension per year having now received my deferred pension leavers statement.

I just received it the other day as I left at the tail end of last year. My previous posts were guesstimate

There is still some errors in the calculations so will need to sort those out before thinking about asking for a CETV

RuleTheWorld

RuleTheWorld wrote: »

final value was calculated as £9,169.50/year and only now in a position to request a transfer value. One per year allowed with no charge

CETV requested so get your guesses in.

Will be back with the answer in four weeks!

Fermion

Ordinarily I would think DB pension is king and do NOT consider moving it but the increase per year is capped at a maximum of 2.5% year and perhaps it could grow more in a traditional investment DC pot.

There is one scenario where is may be worthwhile to consider moving and that's where the DB pension fund is significantly underfunded and the parent company guarantor is a failing company. In that situation it is definitely worthwhile considering as current employees/future pensioners are at the bottom of the pile if the company defaults. You should be able to find out from the companies account accounts what their liabilities are regarding the pension fund.

RuleTheWorld

huge deficit as you would imagine with most schemes of this sort. they are trying to address it slowly.

company is in a good position.

db been closed to new entrants since 2008 and theyve taken steps to pay deficit and reduce the benefits of the existing members recently

Dansmam

kidmugsy wrote: »

I'm not being entirely whimsical when I say transfer it out to a SIPP that allows you to invest in gold bullion and do so. Now that HMG is publicly flirting with the idea of rewriting the contract between a pension scheme and its members, I'd say that 33 years of risking such behaviour - some of them doubtless under governments even more hysterical than this one - is none too attractive. Unless, of course, the CETV is hopelessly bad.

P.S. Come to think of it, is there a SIPP that allows investment in bullion stored in Switzerland? That might be better than storage in London.

I've recently been thinking along these lines. LGPS with 340k CETV but I no longer trust my employer not to unilaterally change the rules. I reach 55 next year and am sorely tempted to shift it all out to a SIPP. I have a decent skill set and would be looking to SE or another job and have a ho-hum attitude to risk, but if I'm thinking this way in a fully funded scheme I'm thinking the landscape is radically changed.

hyubh

Dansmam wrote: »

I've recently been thinking along these lines. LGPS with 340k CETV but I no longer trust my employer not to unilaterally change the rules.

Erm, employers in the LGPS have precisely zero control over the rules. If it's an old admission body, all it can do is start saving up to exit.

I reach 55 next year and am sorely tempted to shift it all out to a SIPP.

Cue worn joke congratulating you on your altruism towards fellow council tax payers...

I have a decent skill set and would be looking to SE or another job and have a ho-hum attitude to risk

Which makes the idea of transferring out from the LGPS all the more peculiar.

I'm thinking this way in a fully funded scheme I'm thinking the landscape is radically changed.

This doesn't make any sense. 'Fully funded' is a term only applicable to DB schemes. And the landscape has not 'radically changed' at all for public sector schemes - in the case of the LGPS, its last radical reorganisation was in the mid-70s when funds were consolidated at the county level.

ffacoffipawb

RuleTheWorld wrote: »

CETV requested so get your guesses in.

Will be back with the answer in four weeks!

£315,000 is my guess

RuleTheWorld

ffacoffipawb wrote: »

£315,000 is my guess

if that was the offer how would someone value keeping extra capacity in the LTA versus giving it away?

Dansmam

hyubh wrote: »

Erm, employers in the LGPS have precisely zero control over the rules. If it's an old admission body, all it can do is start saving up to exit.



Cue worn joke congratulating you on your altruism towards fellow council tax payers...



Which makes the idea of transferring out from the LGPS all the more peculiar.



This doesn't make any sense. 'Fully funded' is a term only applicable to DB schemes. And the landscape has not 'radically changed' at all for public sector schemes - in the case of the LGPS, its last radical reorganisation was in the mid-70s when funds were consolidated at the county level.

Had you been on the Christmas sherry? It's a fully funded DB scheme that's been progressively eroded. So I was on track years ago to achieve a lump sum that would clear the mortgage. That went. Was final salary now career average, Government now talking about combining schemes and directing where the investments should go. Etc. And the current full-out drive to a tiny public service makes me wonder how on earth it's going to be sustainable. I've always been altruistic but now I'm looking out for me.

hyubh

Dansmam wrote: »

It's a fully funded DB scheme that's been progressively eroded.

Whatever you think, the legal situation is fundamentally different to a similarly-sized private sector DB pension fund with respect to the safety of individual member benefits (excepting those private sector funds with a crown guarantee or the like for historical reasons).

So I was on track years ago to achieve a lump sum that would clear the mortgage. That went.

From April 2008 a 1/80 pension, 3/80 lump sum arrangement was replaced with a 1/60 pension, no lump sum one for accrual going forward. This wasn't less generous, just a bit different.

Was final salary now career average

... with an absurdly generous accrual rate (1/49) that meant the CARE scheme was officially costed to be no less expensive than the FS scheme it replaced. Most people in their 50s and 60s have in fact been better off with the change - I don't have any numbers, but anecdotally, some LGPS funds have found the 2014 scheme 'underpin' to have never bitten for a single person, all due to the CARE accrual rate.

Government now talking about combining schemes and directing where the investments should go.

Hasn't actually happened, however LGPS funds have always had special rules on what they could invest in compared to private sector DB funds.

Etc.

The LGPS scene compared to private sector DB is an oasis of calm and stability. Investment pooling came up and is happening, however the government has lost interest and administering authorities are essentially being left alone to get on with it.

And the current full-out drive to a tiny public service makes me wonder how on earth it's going to be sustainable.

If that were true, why is LGPS membership overall either static or still slightly growing?