USS Transfer Value?

rathernot

Does anyone know if there is a quick way to calculate the likely transfer value of an old USS pension please?

Right now it's merely curiosity having spent years paying into my pension with various employers without giving it too much though.

Age creeps up on us all though and I find myself wondering how I'd go about working out what it's worth if I did want to transfer

Dox

Short answer is no, but you can get a non-guaranteed CETV from the scheme: https://www.uss.co.uk/ifas/ifas-home/what-uss-will-provide

If you then decide you are serious about investigating a transfer, you can get a guaranteed CETV.

rathernot

Sorry, I missed the notification that there was a reply.

Thank you very much, some numbers I see online sound bizarrely high considering what feels like the small amount in there right now.

That said, when I use their modeller to see the predicted pension, I can understand why they may find it preferable to get it off their books.

GunJack

rathernot wrote: »

Sorry, I missed the notification that there was a reply.

Thank you very much, some numbers I see online sound bizarrely high considering what feels like the small amount in there right now.

That said, when I use their modeller to see the predicted pension, I can understand why they may find it preferable to get it off their books.

Isn't the USS classed as a public sector final salary scheme? Can you even transfer out of it now??

hyubh

GunJack wrote: »

Isn't the USS classed as a public sector final salary scheme?

No, hence the current pressure to go fully DC.

GunJack

hyubh wrote: »

No, hence the current pressure to go fully DC.

Thanks for clarifying

rathernot

Well if I go to the USS deferred member modeller, based off the last statement, it suggests that at 65 my tax free lump sum could be roughly £25K and an annual pension of roughly £8250.

If I plug that into a few online calculators there's a suggestion of a transfer value of between £160-230K.

I'm naive with pensions as until recently I considered myself years away from retirement so just blindly paid in.

Now I'm in my early 40's so whilst I'm still years away it is suddenly more relevant than it was.

£160-200K seems a massive sum assuming that's basically as good as "cash" into a SIPP or similar.

NoMore

Its not really a massive sum, you need to look at what your giving up for that sum.

You are giving up a guaranteed index linked £8250 for the rest of your life with you having nothing to worry about in investment performance or anything else, you will just keep getting the £8250 every year plus the index linking. If you take the CETV, the guarantee is gone and its up to you to invest and grow that pot to equal or better what you gave up. Are you prepared to do that ?

rathernot

Yes I can see that side, but I'm also trying to wrap my head around what could be done with the CETV over 15 or so years.

Please don't get me wrong, I'm not about to do anything hasty/rash even without the FCA safeguards in place to stop me doing so - but until a few months back I'd almost written off this old pension as I simply didn't realise it was potentially such a decent amount.

Albermarle

There are numerous threads on this board about CETV's and the pros and cons of cashing out of Final Salary schemes .

I know because I have been reading them all !.
As a comparison I have a pension that will pay approx. £15,000 pa + RPI in 5 years time ( without taking the 25% tax free lump sum ) . I have been offered over £470K to buy me out . At first glance it looks an incredible sum .
However if you research the cost of an equivalent annuity , with RPI linking ; min 50% spouse pension etc then this would also cost you a very large sum of money as well.
Investing the CETV yourself is the alternative, but you will need to know what you are doing and have strong nerves when the markets have a big wobble .
In my case I have DC pots as well , so I prefer to keep the security of a fixed income for at least half of my pension , then it is not so stressful if the other half goes through a market dip.

LHW99

Don't forget the USS DB scheme will also let you swap some of the lump sum for additional annual pension.