Teachers' pension

PasturesNew

seven-day-weekend wrote: »

I think you can nominate another beneficiary if you have no spouse.

That would be interesting if you nominated a 1 year old child of a relative, who then went on to live to be 120.
... in fact, now there's a thing:

ADVERT
Teachers.... feeling the pinch? Single in your old age? Would you like to receive £20,000 cash immediately? Simply sell your "nominated beneficiary" space to somebody in their 40s/50s who has no pension and is a bit worried .....

m_c_s

Has anyone actually calculated or have an opinion on whether it is better to buy added years/extra pension directly or take an AVC?
People say it is expensive to buy added years but is this true when compared to a return from a typical AVC?
I think it is often forgotten that with added years or direct purchase the additonal benefits are also enhanced but this is not the case with AVC.

seven-day-weekend

looby-loo wrote: »

If you don't mind me asking, how much did he pay in to AVCs and for how many years to get £500 a year. I've been told to get them and I must say I'm very unsure

I can't remember how many years but he had a 'pot' of £10,000 and took it at 55.

seven-day-weekend

littleowl wrote: »

Believe me I am very pleased I have it!

I don't remember there being any opportunity to buy into pension other than AVCs.

I receive around £800 a year from the latter but do remember being told by the Prudential, which was employed by the college in which I was a lecturer to offer AVCs, that the puchasing power would be much higher. However, when I bought the annuity that was the result and, as it was relatively small I needed to take the whole amount rather than having it indexed linked. Probably not a good decision.

I don't suppose it is possible to 'sell' the annuity for a lump sum at this stage is it?

Yes, Prudential told my husband he would receive more than that. I suppose they project large growth and in those particular years the growth had not been large. His Prudential Pension is not index-linked either (for a similar reason as yourself)

Selling the annuity? I really don't know. Would be good if we could!:rotfl:

Does anyone know if we can sell an annuity my husbnad has been receiving for over three years???.

seven-day-weekend

PasturesNew wrote: »

That would be interesting if you nominated a 1 year old child of a relative, who then went on to live to be 120.
... in fact, now there's a thing:

ADVERT
Teachers.... feeling the pinch? Single in your old age? Would you like to receive £20,000 cash immediately? Simply sell your "nominated beneficiary" space to somebody in their 40s/50s who has no pension and is a bit worried .....

Hey...that's not actually a bad idea! (Bearing in mind that the spouse/beneficiary pension is half that the teacher gets).

EDITED TO ADD: Unfortunately, the beneficiary has to be a dependent relative. See below (this is acually taken from the NATFHE site (National Association for Teachers in Further and Higher Education) but referes to the Teachers' Pension scheme:

THE TEACHERS' PENSION - WHAT YOU GET

• The Teachers' Pension Scheme provides a pension based on final salary. If you leave the profession after two years' service, but before retirement, your pension will be based on your final salary increased in line with the cost of living until you reach pensionable age. It is also index-linked after retirement.
• Both men and women can retire at 60 on a full pension.
• Your pension is calculated by taking 1/80th of your final salary and multiplying that by your years of service - so, for example, if you teach full-time for 40 years you would retire on a half-salary.
• The pension is index-linked and is increased annually from the first Monday after 5 April each year.
• If you will have less than 40 years' service by the time you are 60, you can buy extra years.
• You get a lump sum at retirement equal to three times the annual pension (tax-free).
• Since 1 April 2000, lecturers who retire can elect for any re-employment after retirement to be pensionable, after a qualifying period of one year of early retirement. You can choose to pay contributions backdated to 1 April 2000, with the agreement of the employer (7% interest will be payable). If you have retired on a full pension there are limits to the amount you can earn in any financial year without suffering a reduction in your pension - check with Teachers' Pensions for information relevant to your salary and pension.
• If you become permanently incapacitated from teaching, you can receive an ill-health pension.
• If your retirement benefits become payable on or after 1 April 2000 and you die within five years of retirement, your estate will receive the remainder of the pension which you would have received if you had lived to draw it for five years.
• If you die while still in service and paying pension contributions, your nominee will get a death grant, currently equal to twice your average salary. If you want anyone other than your spouse to receive this, you should nominate that person on a form obtainable from Teachers' Pensions.
• There are long term pensions for widows based on service from 1972 (from 1978 if the marriage took place after leaving service) and for widowers, based on service from 1988, unless earlier service has been purchased for family benefits. You can also nominate a dependant relative if you have no spouse. The scheme does not yet provide a long term pension to an unmarried partner - NATFHE is campaigning to change this.
• The scheme also provides pensions for children while they are under 17 or in full-time education.
• You can estimate your retirement benefits by checking out the calculator on the Teachers' Pensions website.

littleowl

seven-day-weekend wrote: »

Yes, Prudential told my husband he would receive more than that. I suppose they project large growth and in those particular years the growth had not been large. His Prudential Pension is not index-linked either (for a similar reason as yourself)

Selling the annuity? I really don't know. Would be good if we could!:rotfl:

Does anyone know if we can sell an annuity my husbnad has been receiving for over three years???.

I do feel that annuities - certainly those purchased when I did - were over sold and certainly did not produce the returns promised. I have searched everywhere but it seems that this is a done deal which cannot be changed. If anyone has any better information I would love to know.

littleowl

seven-day-weekend wrote: »

Hey...that's not actually a bad idea! (Bearing in mind that the spouse/beneficiary pension is half that the teacher gets).

As far as I am aware there is no provision for anyone other than a spouse to receive part of a teacher's pension. Is there any evidence to the contrary?

PasturesNew

seven-day-weekend wrote: »

Hey...that's not actually a bad idea! (Bearing in mind that the spouse/beneficiary pension is half that the teacher gets).

If you took a figure where a teacher's final salary was £45k and their pension was 2/3rds of that, £30k... then half that is more than most of us earn in a year. So yes, it is a lot ... and doable

For a single person, old age pension + minimum income guarantee is about £5-6000. So it's worth 3x that.

littleowl

PasturesNew wrote: »

If you took a figure where a teacher's final salary was £45k and their pension was 2/3rds of that, £30k... then half that is more than most of us earn in a year. So yes, it is a lot ... and doable

For a single person, old age pension + minimum income guarantee is about £5-6000. So it's worth 3x that.

Good heavens! I was a lecturer for 18 years and final salary around £24,000 so my pension income is a fraction of that estimate! I can only assume that things have changed remarkably in the last 10 years.

seven-day-weekend

My husband taught for twenty years . His final salry was around £30k. He took an actuarilly reduced pension at 55 and at the moment it is around £7500 a year.

Not quite the 30 grand that you quoted!!