Stakeholder pension transfer into LGPS

xylophone

It's been 8 working days since I posted my request form for Transfer Values of my Aviva pensions. Still no reply as yet..!

https://forums.moneysavingexpert.com/discussion/5706285

Aviva has never been known for having a good quality telephone service and it does take 7-10 days answering paper requests. However, accessing money is one of its strong points.

NewPensionPerson

I’ve now received my transfer value for one of my stake holder pensions and have sent the information onto my LGPS scheme, who have also now sent me a reply back. I’ve just outlined a few key points below to see if I’m making any sense.

Information below regarding my active Aviva stake holder’s pension

Regular Contribution Payment type Amount (£) 30.77 Tax relief (£) 7.69 Total (£) 38.46 / £461.52 per month

Plan start date
1 May 2002
Chosen pension age
65

The statement shows what your plan is worth now, the payments into your plan and how much it
Could be worth when you retire.

Your plan summary from 1 May 2016 to 30 April 2017
Plan values calculated on 30 April 2017
Total fund value £11734.50
Transfer value £11734.50
Last year's transfer value £10418.43
From your statement dated 1 May 2016
Plan payments for 1 May 2016 to 30 April 2017
Payments into your plan £461.52

What you might get back
At age 65 we think this fund could be worth £23200

Your plan value
Value of your fund
This gives you a breakdown of your fund value including final bonus. Please remember the values
Can go down as well as up and aren't guaranteed.
Final Bonus 2424.51
Value of your fund on 30 April 2017 11734.50
The transfer value of your fund on 30 April 2017 is £11,734.50.
If our investments grow each year at: 3.90%
Your fund could be worth: £43000
But allowing for inflation each year of: 2.50%
Your fund in today's prices could be: £23200
If the cost of buying the income when you retire is based on an interest
Rate of: -2.20% your starting income in today's prices could be: £49 a month

“With the above information I sent to my new works pension provider the (West Yorkshire Pension Fund), to see what the transfer value would be within a Lincolnshire Pension Fund.
This was the letter I reived back from the WYPF.

“Transfer of pension rights from Aviva.
Transfer Credit:
The transfer value would buy an amount of additional pension in The Local Government Pension Scheme (LPGS). This pension would be added to your LPF pension account and would increase every April in line with the cost of living. It would be in addition to the pension you have built up in the LGPS.
Estimated value £1368.92

“So to summarize could anyone recommend transferring my Aviva pension into my new works pension.”

Silvertabby

Aviva are saying that if you stop paying into your stakeholder, then your fund could be worth £23,200 at age 65. It could be more, it could be less.

The LGPS, however, are saying that in return for your current fund of £11,734.50 they will pay you an index linked pension of £1368.92 from State pension age. (The LGPS letter says 'estimated' just in case the transfer value and/or the transfer factors change before the transfer can be finalised).

Assuming that you live for the average 20 years after retirement, the LGPS will pay you 20 x £1368.92 = £27,378.84 plus inflationary increases (both before and after retirement).

No-one one these boards can offer actual advice, so the final decision is up to you.

All I can say is that the LGPS transfer factors are really rather generous. Before I retired as a LGPS administrator last year, my colleagues and I were having bets on how long it would take the powers-that-be to realise that the factors were too generous and rein them back.

WillowCat

That's stonkingly good value. Now seriously considering trying to get a local government job just so I can transfer some of my pension!

AlanP_2

WillowCat wrote: »

That's stonkingly good value. Now seriously considering trying to get a local government job just so I can transfer some of my pension!

There are loads of vacancies - come and join us.

Mind you MrMuscle and a few other posters on here will never talk to you again as you would be "sponging off them".

bigadaj

AlanP wrote: »

There are loads of vacancies - come and join us.

Mind you MrMuscle and a few other posters on here will never talk to you again as you would be "sponging off them".

....and in shock news we've found out that one of the bigger culprits has been Mrs muscle, who'd have thunk it?

JoeCrystal

WillowCat wrote: »

That's stonkingly good value. Now seriously considering trying to get a local government job just so I can transfer some of my pension!

Apparently, a new starter need to pay into LGPS for at least two years to keep it deferred if leaving the job. However, as far as I am aware, you can transfer the pension pot in and once it is all settled, you can leave right away making it deferred without needing two years. Again, I am not sure I got that right.

Silvertabby

Joe - you are right.

However, it takes up to 3 months for a pension record to be set up with the LGPS, as anyone who opts out within the first 3 months of service has their contributions refunded by their employer.

It could then take a further 3 months to finalise the transfer.