Police Pension advice

eggchaser

I am a serving Police officer with 11 years service. I am enrolled on the 2007 pension scheme.
I am very aware of how good a Police pension is compared to others however, due to personal reasons, I don’t think I can carry on being a PC to see out the 35 years.
My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in? I hope to be gone within 5 years, 10 max.
If not seeing the pension to maturity, is my next best option to cancel now and invest the money elsewhere or keep going until I leave? I know I am missing out on a lot by leaving such as govt contributions etc but I have to consider my welfare/quality of life also.
Thank you

HappyHarry

eggchaser wrote: »

I am a serving Police officer with 11 years service. I am enrolled on the 2007 pension scheme.
I am very aware of how good a Police pension is compared to others however, due to personal reasons, I don’t think I can carry on being a PC to see out the 35 years.
My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in? I hope to be gone within 5 years, 10 max.
If not seeing the pension to maturity, is my next best option to cancel now and invest the money elsewhere or keep going until I leave? I know I am missing out on a lot by leaving such as govt contributions etc but I have to consider my welfare/quality of life also.
Thank you

There is a massive benefit with continuing to contribute to the police pension.


You will still get a pension from the police in retirement, based on your years of service. It won't be as much as if you continued to work for the police for 40 years, but will still be paid.


There is no hope that you could match the benefits of the police pension by investing your contributions elsewhere.

dunstonh

My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in?

If you stop being a member, you reduce your future entitlement as you will have less years service. That means lower income in retirement. So, stopping it before you leave would be an expensive mistake.

I hope to be gone within 5 years, 10 max.

If you remain a member you get a another 5-10 years service on the pension. Nothing in the retail market can come close to matching those benefits.

is my next best option to cancel now and invest the money elsewhere or keep going until I leave?

To give you an idea, it would cost you around 35% of your salary to match the benefits of the police pension scheme using retail financial products.

I know I am missing out on a lot by leaving such as govt contributions etc but I have to consider my welfare/quality of life also.

I think you have a misconception on the pension and how it works. It is not reduced if you finish working with them early. You gain for every year you are a member. It accrues as you go along. So, the longer you stay, the better it is. You do not take a financial hit directly by leaving employment early. You just cease to accrue additional years of service.

No alternative will come close to membership of the police pension scheme.

JoeCrystal

eggchaser wrote: »

I am a serving Police officer with 11 years service. I am enrolled on the 2007 pension scheme.
I am very aware of how good a Police pension is compared to others however, due to personal reasons, I don’t think I can carry on being a PC to see out the 35 years.
My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in? I hope to be gone within 5 years, 10 max.
If not seeing the pension to maturity, is my next best option to cancel now and invest the money elsewhere or keep going until I leave? I know I am missing out on a lot by leaving such as govt contributions etc but I have to consider my welfare/quality of life also.
Thank you

govt contributions? What govt contributions? Your Police Pension scheme is one of the best in the country and opting out will quickly be your worst financial decision. Iron-clad index-linked pension is a rarity in this country.

Silvertabby

eggchaser wrote: »

I am a serving Police officer with 11 years service. I am enrolled on the 2007 pension scheme.
I am very aware of how good a Police pension is compared to others however, due to personal reasons, I don’t think I can carry on being a PC to see out the 35 years.
My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in? I hope to be gone within 5 years, 10 max.
If not seeing the pension to maturity, is my next best option to cancel now and invest the money elsewhere or keep going until I leave? I know I am missing out on a lot by leaving such as govt contributions etc but I have to consider my welfare/quality of life also.
Thank you

Stick with it. You'll have accrued another 5/10 years of very valuable deferred pension rights by the time you leave, plus all the additional benefits in the meantime.

You say that you can't see yourself carrying on as a police officer for personal reasons, but could those reasons be health related? I'm thinking along the lines of a possible ill health enhanced pension - which you wouldn't get if you had opted out.

atush

Keep gppoing until you leave.

Open a S&S isa or a sipp for other savings. This can help tide you over to SPA ad when your ploice pension will pay out.

hugheskevi

I am a serving Police officer with 11 years service. I am enrolled on the 2007 pension scheme.
I am very aware of how good a Police pension is compared to others however, due to personal reasons, I don’t think I can carry on being a PC to see out the 35 years.
My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in? I hope to be gone within 5 years, 10 max.

Are you sure you are in the 2007 pension scheme? Based on the things you say above, it would seem more likely that you are in the 2015 scheme?

Details of the schemes at this link.

hyubh

hugheskevi wrote: »

Are you sure you are in the 2007 pension scheme? Based on the things you say above, it would seem more likely that you are in the 2015 scheme?

Would have thought more a typo for the 2006 scheme, given the allusion to 35 years maximum accrual (1987 scheme was/is 30 years, and the 2015 scheme doesn't have the concept at all). However, presumably with 11 years service in 2019, the OP would have been moved into the CARE scheme on its introduction? Being well over the 14 years from NPA at 1/4/12 needed for any tapered protection, let alone the 10 years for full protection.

hyubh

eggchaser wrote: »

My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on paying in? I hope to be gone within 5 years, 10 max.
If not seeing the pension to maturity, is my next best option to cancel now and invest the money elsewhere or keep going until I leave?

The only sense at all in speaking of a modern FPS pension reaching 'maturity' is when the member reaches normal pension age, and so can draw their pension without an actuarial reduction (for the CARE scheme, this is from age 60 if retiring from active, and from state pension age if retiring from deferred). However, this is a very weak sense of 'maturity' - an active officer who joined the force aged 55 would have his or her pension reach 'maturity' at age 60 just as much as one who joined straight out of school/college. Clearly 42 years membership will give a much, much bigger pension than only 5 however.

I don’t think I can carry on being a PC to see out the 35 years.

The 35 years thing in the 2006 scheme was a cap - you could stay an active member, paying contributions, after 35 years (e.g. to maintain full ill health benefits), however no years beyond 35 would count towards your pension. There was no particular benefit to seeing out 35 years as such - it was purely a limit.

jamesd

Adding to the others, stay in it and it will form a nice guaranteed core to the long part of your retirement income needs, without any investment risk.

Private sector jobs normally have investment based pensions and drawing on those can enable early retirement before the police and state pensions start. The combination can work very well.

kidmugsy

eggchaser wrote: »

I am a serving Police officer with 11 years service. I am very aware of how good a Police salary is compared to others however, due to personal reasons, I don’t think I can carry on being a PC to see out the 35 years.

My question really is, if I am not intending on getting to the ‘end’, is there any point in carrying on accepting the pay? I hope to be gone within 5 years, 10 max.

I hope you find my editing helpful.