NHS pension early but working

Johnnyboy11

I think the NHS pension loses indexation if started before age 55, but it kicks in again once you reach age 55. Worth looking into.

zagubov

So you're thinking of claiming the pension from one job (the three-day one) but keep working that same job while resigning your additional one (the two day one)?

Does your employer have a winding down/stepping down/phased retirement system?

You might want to investigate whether your main employer would let you retire but take you back in a new post, with auto-enrolment in a new pension.

You might need to find out if there is an advantage to taking a gap in employment regarding a cap on your combined pension+ salary in your new post.

What you need to consider carefully is that you may be leaving a DB scheme whose replacement may be expensive and much less good value.

crv1963

There are several flies in the ointment that I can see as follows-

1) The actuarial reduction will mean a much smaller pension when you actually do retire from work for good- robbing your future self for needs now doesn't seem good value.

2) You have to leave all NHS employment before you can claim your NHS pension- you aren't guaranteed that you will get one of your posts back as they have to be advertised "in the open market".

3) Your 2015 scheme contributions remain preserved until you reach SPA.

4) You're restricting any future potential NHS earnings as you cannot earn more with the restriction placed with the earnings being limited to Pension + Pay not being allowed to be greater than your finishing salary. So unless you are in a high paying band now you really are shooting yourself in the foot. Your pension will not get any uplift until NRA but your salary will so as pay rises the number of hours you can work will reduce.

5) If you get round 1 + 2, then you can't build further NHS pension entitlement in the 2015 scheme and that means saving into a personal pension of some sort- you may be lucky with the markets, you may not so have no certainty unlike your current scheme membership.

A better solution may be to seek a FT post with one Trust and then either work Bank for one or both of the Trusts? It will of course depend upon the local NHS jobs market, budget priorities and which field/ profession you are working in.

kidmugsy

Sawman wrote: »

I’d like to drop one of my jobs (2 days) but with 1 at university and another doing gcse I dont think I can afford to.

Interest rates are still low. Bung some debt on the mortgage, fix the interest rate, and pay it back from your bigger pension at 60. Time-shifting money is exactly what loans are for.

mollycat

crv1963 wrote: »

There are several flies in the ointment that I can see as follows-

1) The actuarial reduction will mean a much smaller pension when you actually do retire from work for good- robbing your future self for needs now doesn't seem good value.

2) You have to leave all NHS employment before you can claim your NHS pension- you aren't guaranteed that you will get one of your posts back as they have to be advertised "in the open market".

3) Your 2015 scheme contributions remain preserved until you reach SPA.

4) You're restricting any future potential NHS earnings as you cannot earn more with the restriction placed with the earnings being limited to Pension + Pay not being allowed to be greater than your finishing salary. So unless you are in a high paying band now you really are shooting yourself in the foot. Your pension will not get any uplift until NRA but your salary will so as pay rises the number of hours you can work will reduce.

5) If you get round 1 + 2, then you can't build further NHS pension entitlement in the 2015 scheme and that means saving into a personal pension of some sort- you may be lucky with the markets, you may not so have no certainty unlike your current scheme membership.

A better solution may be to seek a FT post with one Trust and then either work Bank for one or both of the Trusts? It will of course depend upon the local NHS jobs market, budget priorities and which field/ profession you are working in.

Hi crv1963; don't know if the bit I've bolded is in response to my earlier "fly in the ointment" comment.

For clarity, I meant 1 FITO to the plan actually being do-able; of course every other FITO you detail above is 100% correct also.

Totally get people leaving early with acturial reduction and bailing out because they are fed up with the job and can take the financial hit.

Also get people continuing to work after 55 and taking pension because they need to, (pension insn't enough to live on).

Not sure I understand the benefit of OP's plan, who intends to work on for 10 years, disadvantaging self in terms of future pension provision in order to access lump sum 2 years early.

As others have suggested; don't take pension now; rationalise employment arrangements as needed to give a much more sound long term financial outlook.

crv1963

Hi Mollycat, I didn't mean any offence, I just mulled over what other flies I can see.

I know several MHOs who have taken the hit at 50 due to the work pressures and others that have retired and returned at 55. Some because they need the income, some because they like the work place and one who works to have a break from being a carer. I also know a few especially around my age that are doing what I am working 55-58 to get the additional 5/80ths on their pensions.

I was trying to worn OP against his plan as it seems he should try to do as you suggest in your last paragraph, then revisit his plan. Maybe do as kidmugsy suggests if cashflow is an issue.

I can empathise with the 60 hour week with travel, so a FT post in one place makes more sense if this is available.

mollycat

crv1963 wrote: »

Hi Mollycat, I didn't mean any offence, I just mulled over what other flies I can see.

I know several MHOs who have taken the hit at 50 due to the work pressures and others that have retired and returned at 55. Some because they need the income, some because they like the work place and one who works to have a break from being a carer. I also know a few especially around my age that are doing what I am working 55-58 to get the additional 5/80ths on their pensions.

I was trying to worn OP against his plan as it seems he should try to do as you suggest in your last paragraph, then revisit his plan. Maybe do as kidmugsy suggests if cashflow is an issue.

I can empathise with the 60 hour week with travel, so a FT post in one place makes more sense if this is available.

No offence taken mate, apologies if it read that way!

Agree with all that you have said on the thread; everyone's circumstances are different sure.

Maybe i've misunderstood the OP's motivation, but if giving up 27% of pension, (for ever) 80% of the lump sum and ending the opportunity to accrue more benefits is just to access the lump sum earlier, I don't think that's advantageous.

Anyway, stick in!

Hopelessly_Hopeful

https://www.nhsbsa.nhs.uk/sites/default/files/2017-09/Abatement%20basic%20overview-20170906-%28V1%29.pdf

My understanding and please see attached fact sheet is that abatement only applies to certain circumstances such as special class/MHO or when you have been given relief from penalty etc and not the one described by the OP

Sawman

Thanks for all the comments and advice. It seems quite a complex area. It did not occur to me that I might need to re apply for one of my jobs. I need to have a look at the trust's retirement policy.
My main reason for looking at this is that I know a good number of people, who either haven't got to retire or just managed it and then conked out. I am not unhealthy, but feel that my current lifestyle is sub optimal, I mainly commute, work, commute, stare at the telly for an hour or so sleep and repeat

I am in the fortunate position to have been quite highly banded for a large part of my career, and so a reduced pension would still be reasonable (ish)

rationalising into 1 full time post is unlikely, - the reason I have 2 part time posts is because there are precious full time posts in my field (I previously has 2 part time jobs 200 miles apart - at least my current ones are closer!) bank work is unheard of.

overall it may be that the time is not quite right just now, but I guess there is a sweet spot where it may be. I think I need to look at the numbers now, and see where we are up to. as has been suggested it may be that just ditching one job and staying in the pension will be the better option

zagubov

Hopelessly_Hopeful wrote: »

https://www.nhsbsa.nhs.uk/sites/default/files/2017-09/Abatement%20basic%20overview-20170906-%28V1%29.pdf

My understanding and please see attached fact sheet is that abatement only applies to certain circumstances such as special class/MHO or when you have been given relief from penalty etc and not the one described by the OP

The OP might also want to read this Retire and Return fact sheet too
https://www.nhsbsa.nhs.uk/sites/default/files/2017-11/Retire%20and%20return%20guide-20171117-%28V1%29.pdf