CETV worth transferring?

Parking_Trouble

Yes, I expected to see a higher projected pension but assumed it is £1,388

Does that mean it should actually be higher at NRD?

Parking_Trouble

I found the only other pension statement I had from them back in 2000.

This was from Smith Kline Beecham, now it is Glaxo Smith Kline. I was employed by Smith Kline and French.

This statement say estimated pension at NRD is £4,841 !!!

It says the ex-SKF employees NRA is 62

It says leavers before 6th April 1988 get revalued at 8.5% p.a.

Don't understand what is going on.

Might have missed out somewhere in the second merger where SKB became GSK.

They had my address in 2000 and I still live at the same address.

xylophone

It says leavers before 6th April 1988 get revalued at 8.5% p.a.

Have you read the link in post 5?

neilvw

These numbers don't make sense.

GMP of £314.60 at date of leaving, revalued @ 8.5% up to now = c. £3,600 and up to 65 = c. £5,900. Perhaps they switched from fixed-rate revaluation to full-rate at some point.

Ask for total accrued benefits to date, and a projection to age 65. An immediate retirement quote might be misleadingly low as they don't have to pay the GMP till age 65.

xylophone

As far as I can make out (although the OP is not very clear), he left Glaxo in 1987 with a GMP of £314.60 and an excess of £535.40.

The NRA of his section of the scheme seems to be 62.

It appears that FiR is used for GMP revaluation in deferment - he left pre 88 so this will be 8.5%

With regard to the excess, he may be entitled to statutory revaluation on some part of this but it is possible that the Glaxo scheme is more generous and revalues by scheme rules.

He should check with the administrator what will happen at Scheme Pension Age ( if he does not transfer out) when he draws the pension.

It may be that he will receive only the revalued excess and unrevalued GMP at 62 with a step up at age 65.

At all events, from age 65, the scheme will have no obligation to index link the revalued GMP portion of the pension.

However, the scheme must pay at least the revalued GMP from GMP age.

bostonerimus

Yes clarification on the actual numbers is necessary here.

Tealblue

The word 'assume' is appearing rather too often - but a good IFA will set you straight.

To answer you question 'What is an IFA likely to charge to support the transfer out?', fees don't vary depending on the advice given. Whether the IFA 'supports' the transfer out doesn't matter; the legal requirement is that you must have received advice (not the same thing as taking it). Some pension providers will only accept transfers where the IFA recommends you do transfer, but there are plenty who will take them anyway.

Cost will be upwards of £1,000.

Parking_Trouble

Apologies. I only have two documents. One from 2000 and one from a couple of weeks ago. If I could scan them and post them I would.

Consistent numbers are
Pension at Leaving / Total Deferred pension at exit is £850.98
Pre 06/04/88 GMP at date of leaving / Total GMP at exit is £314.60

Although the 2000 doc says SKF NRA is 62 both state my NRD in 2023 (65) . The 2000 doc incorrectly states I was a Beecham employee but I was SKF and left before the merger with Beecham.

for leavers between 1/1/86 and 1/5/90 the Excess Pension which accrued after 1/1/85 only is is revalued at 5%pa

GMP is revalued at 8.5% pa for leavers prior to 6/4/88

Non-GMP revaluation for SK&F leavers prior to 1/5/90 have a guaranteed 5% revaluation rate. 50% Widows pension. 5 year vested rights. Cash sum available.

£314.60 compound at 8.5% from 1987 to 2020 (33 years) = £4644.51

Not sure if this is relevant but...

£850.98 - £314.60 = £536.38 (is that the excess??)

£536.38 compound at 5% for 33 years = £2683.61

Revalued GMP (£4644.51) + revalued excess (£2683.61) = £7328

I will check with Equiniti but is that it in principle?

There was another merger after 2000 but no idea if any terms were changed.

However if I get £4k pa from age 62 then the desire to transfer out is going to be much less and if as high as £7k then really no point.

xylophone

Re GMP revaluation

The revaluation period for GMPs is the number of complete tax years between a member's date of leaving and their GMP Pension Age. For members retiring before they reach GMP Pension Age, the revaluation period for GMPs would normally be the number of 6 Aprils between the two dates.

Furthermore, if a members actual retirement date is after their GMP Pension Age then statutory late retirement increases will apply to the GMP.

For men, GMP age is 65 and for women 60.


As has been noted, your scheme (as is most usual outside the public sector) uses Fixed Rate revaluation which in your case is 8.5%.

If your total pension at leaving was £850.98 and the GMP £314.60, the excess is the difference between the two.

According to what you have written above, it is a portion of the excess (excess accrued after 1.1.85) that revalues at 5% - presumably the earlier accrual does not revalue. Check with the administrator.

You should check your Scheme Pension Age with the administrator.

You should also check the figures with the administrator.

You should check index linking once the pension is drawn, remembering that the scheme has no obligation to index link pre 88 GMP in payment.

Parking_Trouble

Thanks Xylophone. That has definitely helped me get my head around it and enable me to ask the right questions.

I don't know why they don't provide a more easily understood calculation and an accurate figure of what has been accrued to date.

I think this could change my plans, especially if I can get this pension at 62.

I also have a Midland Bank DB pension from when I left in 1981 with a GMP of £153.92 I'll look into that one too.