Two pensions, what would you do

ed1su

hiya

Confused about pension.. I worked in a University and had a pension from 1995 to April 2017 ( 1995 - Nov 2011) Final salary and Dec 2011 to April 2017 normal. I was made redundant and since Nov 2017 I am working in NHS and now have NHS pension. This contract is for one year and salary is about 6k less than I was getting paid at university.

Do I transfer my pension into NHS or leave it and have 2 pensions.. my age is in late 40's...

Thank you

AnotherJoe

That would depend entirely upon the rules of the different schemes, what benefits you get in one compared to the other, what the retirement ages are in the schemes, how long you think you'll work for the NHS.

ed1su

AnotherJoe wrote: »

That would depend entirely upon the rules of the different schemes, what benefits you get in one compared to the other, what the retirement ages are in the schemes, how long you think you'll work for the NHS.

Too be honest I have no clue about pension. University pension you can retire at 55. NHS I have no idea. My current contract is one year fix term and I am hoping it will be extended... hoping to work at least till 55 if I get a job. My first job lasted about 28 years...

Thanks for help.. suppose I need to seek professional advice.

Ed1su

AnotherJoe

For someone who worked in a university and now NHS I'd hope you have the underlying smarts to learn about pensions rather than putting head in hands and saying "its all too complicated I'll pay someone"

Do a bit of research, educate yourself.
It really isn't that difficult at root, you pay money in and get money back.
Then there are rules about when you get the money back and who much.
For example, you can get teh money back from university age 55. Lets say with NHS you can get it back until you are 67? MIght that sway you?

Do a bit of research. There will be all sorts of publicly accessible documents you can get hold of that should explain this simply.
Ask here if you have questions, before you make a decision.

Perhaps at that point when you have at least a simple understanding about what the options are, is the time to see a professional, rather than just take someones word for whats best with no clue whats going on?

kidmugsy

ed1su wrote: »

University pension you can retire at 55.

Are you sure? Was it a USS pension, or a TPS pension, or an LGPS pension, ... or was it with a scheme of the University's own?

Even if drawing the pension at 55 is allowed, how heavy is the penalty for doing so i.e. the "actuarial reduction"?

xylophone

I worked in a University and had a pension from 1995 to April 2017 ( 1995 - Nov 2011) Final salary and Dec 2011 to April 2017 normal

Normal what?

And which scheme were you in (see post above)?

TARDIS

Unlikely you'll be able to access the NHS pension at 55 without large accuarial reduction. Much more likely to be at your state pension age.
Have you read this: https://www.nhsbsa.nhs.uk/sites/default/files/2017-05/Transfer%20Booklet%20%28V17%29%2005.2017.pdf

ed1su

kidmugsy wrote: »

Are you sure? Was it a USS pension, or a TPS pension, or an LGPS pension, ... or was it with a scheme of the University's own?

Even if drawing the pension at 55 is allowed, how heavy is the penalty for doing so i.e. the "actuarial reduction"?

I was in USPS, my final statement said : final pensionable salary at date of leaving final salary 23,021.14
Final salary at date of leaving the USPS 24,489.65
Pensionable service at date of leaving 16 years 6 months

ed1su

kidmugsy wrote: »

Are you sure? Was it a USS pension, or a TPS pension, or an LGPS pension, ... or was it with a scheme of the University's own?

Even if drawing the pension at 55 is allowed, how heavy is the penalty for doing so i.e. the "actuarial reduction"?

Members of the Scheme can currently apply to take their benefits early from the age of 55 years.

Members should note that early retirement will affect the pension benefits you receive, both in the Final Salary Section and the Flexible Retirement Plan Section.

For any member who retires before age 65, benefits may be reduced by reference to the Normal Retirement Age of 65 (i.e. taking account of the number of years before your 65th birthday). However, the lump sum payable on retirement will not be reduced. Further details of the circumstances under which reductions apply can be obtained from the Pensions Office.


Reading above I assumed you can take the pension at age of 55

Audaxer

ed1su wrote: »

Members of the Scheme can currently apply to take their benefits early from the age of 55 years.

Members should note that early retirement will affect the pension benefits you receive, both in the Final Salary Section and the Flexible Retirement Plan Section.

For any member who retires before age 65, benefits may be reduced by reference to the Normal Retirement Age of 65 (i.e. taking account of the number of years before your 65th birthday). However, the lump sum payable on retirement will not be reduced. Further details of the circumstances under which reductions apply can be obtained from the Pensions Office.


Reading above I assumed you can take the pension at age of 55

You will be able to take it at 55 but it will be subject to an actuarial reduction because you are taking it 10 years early, i.e. the pension company are having to pay you for an extra 10 years, so I would assume your pension will be significantly reduced.

hyubh

ed1su wrote: »

Members of the Scheme can currently apply to take their benefits early from the age of 55 years.

Members should note that early retirement will affect the pension benefits you receive, both in the Final Salary Section and the Flexible Retirement Plan Section.

For any member who retires before age 65, benefits may be reduced by reference to the Normal Retirement Age of 65 (i.e. taking account of the number of years before your 65th birthday). However, the lump sum payable on retirement will not be reduced. Further details of the circumstances under which reductions apply can be obtained from the Pensions Office.

I'll be honest, I had to Google to figure out whether 'USPS' was a typo for 'USS'. However, that wording proved it wasn't ('University of Sheffield Pension Scheme'). Looking on the website, the USPS was a final salary scheme that stopped future accrual on that basis in 2011 in favour of a contracted-in, cash balance structure. Cash balance schemes might be considered many things, but 'normal' ain't one of them

Not to put too fine a point on it, but cash balance schemes have all the limitations of proper DB schemes (and in the USPS case, proper private sector DB schemes - I see revaluation is capped to 5%) without the actual benefit. Given you've been in the NHS scheme for less than a year, I'd start the process for getting a transfer-in quotation pronto. If you did leave after 12 months, a transfer-in would mean you get a preserved benefit in the NHS scheme notwithstanding. While it may still be the case that the NHS pension bought from the transfer-in isn't attractive, it would still be better to have all the facts on the table before deciding.

Reading above I assumed you can take the pension at age of 55

If you retire before Normal Pension Age benefits will be reduced by reference to the Normal Pension Age (i.e. taking account of the number of years the benefit is taken early).

If you wish to retire from the Pension Scheme before Normal Pension Age, this will require both the consent of the University and of the Trustees.

https://www.sheffield.ac.uk/polopoly_fs/1.123309!/file/USPS_FRP_Member_Guide.pdf

This isn't particularly different to the situation with the NHS scheme, although there the CARE scheme has an NPA of SPA not 65, and there isn't a requirement to get employer agreement first in order to go early.