NHS pension- consequences of temporarily opting out?

zagubov

OP, you'd struggle to find a bigger financial mistake you could make in your life.

JoeCrystal

As many others already pointed out, my thought is that it would cost you far more than you realise if you decide to opt out. Even a single year opt out can easily cost you thousands of pounds during your lifetime. You are on a good income and should be able to do all three goals. Please do not sacrifice a long term goal just got a short term or a long term goal.

Dane89

The replies (from the majority of you, who gratefully chose not to be condescending) are much appreciated! Thank you for taking the time, very useful responses

mollycat

Dane89 wrote: »

The replies (from the majority of you, who gratefully chose not to be condescending) are much appreciated! Thank you for taking the time, very useful responses

No "condescending" intended, (assuming that comment is intended for me, given everyone else on the thread has recieved a thanks).

A doctor that requires to ask the most basic of questions regarding an easily understood aspect of their pension scheme to strangers on the internet?

The "very useful responses" have been a resounding "no" to your financially suicidal idea.....couldn't you have worked this out for yourself?

If you want to see the person in this thread that has demeaned yourself, look in the mirror.

Dane89

It was really a simple request for advice/thoughts, I wasn't looking for a rant about how stupid someone may think I am- what am I supposed to do with that? I have a colleague who has already opted out, and a consultant who has even advised us to consider investing in property as opposed to paying into the pension. Seemed reasonable to me to see what others thought about such a decision- and I'm grateful to them for their input

tibbles209

mollycat wrote: »

A doctor that requires to ask the most basic of questions regarding an easily understood aspect of their pension scheme to strangers on the internet?

The "very useful responses" have been a resounding "no" to your financially suicidal idea.....couldn't you have worked this out for yourself?

If you want to see the person in this thread that has demeaned yourself, look in the mirror.

I agree that opting out of the NHS pension would be a terrible idea, but surely attacking a brand new poster with this level of venom, just because you do not think their question is clever enough, is completely unnecessary? He is here making an effort to learn about the value and benefits of his pension, and he doesn't deserve to be met with hostility for not already knowing it all.

Edale

mollycat wrote: »

No "condescending" intended, (assuming that comment is intended for me, given everyone else on the thread has recieved a thanks).

A doctor that requires to ask the most basic of questions regarding an easily understood aspect of their pension scheme to strangers on the internet?

The "very useful responses" have been a resounding "no" to your financially suicidal idea.....couldn't you have worked this out for yourself?

If you want to see the person in this thread that has demeaned yourself, look in the mirror.

I would rather have a doctor that was brilliant at their speciality and rubbish with their finances than one that was brilliant with their finances and rubbish at their speciality!

AnotherJoe

Devils advocate question:
Aside the very real concern that once someone "temporarily" opts out they will never opt back in, is it not a reasonable financial option for a career path with a substantial long term rise in earnings, that will lead to breaching the LTA quite early on, to consider opting out for a few early years when the money may make a difference to purchasing a house and raising a family, and catch up later once the financial pressure is lesssened ?

GunJack

AnotherJoe wrote: »

Devils advocate question:
Aside the very real concern that once someone "temporarily" opts out they will never opt back in, is it not a reasonable financial option for a career path with a substantial long term rise in earnings, that will lead to breaching the LTA quite early on, to consider opting out for a few early years when the money may make a difference to purchasing a house and raising a family, and catch up later once the financial pressure is lesssened ?

The thing is, it's a MASSIVE risk to opt out of one of the best pension schemes in the country with all the benefits it has, to chase the small amount of money it costs (that you'll never have seen in your pocket anyway. If the OP (or anyone else for that matter) needs to make an extra £2-300 a month they'd be far better getting a pt job to make that, rather than miss out on the:-

1. future income
2. Death In-Service (i.e. Life insurance)
3. Survivor's Benefits
4. Dependant children's benefits
5. Ill-health early retirement

there's probably a few more I've not listed, but you get my drift....and if the unthinkable were to happen and most of the NHS gets privatised, then you'll thank your lucky stars you've got x years service banked already when your new private sector employer's pension scheme is a bog-standard auto-enrolment DC scheme...

mollycat

Dane89 wrote: »

It was really a simple request for advice/thoughts, I wasn't looking for a rant about how stupid someone may think I am- what am I supposed to do with that? I have a colleague who has already opted out, and a consultant who has even advised us to consider investing in property as opposed to paying into the pension. Seemed reasonable to me to see what others thought about such a decision- and I'm grateful to them for their input

Perhaps you could read what I'd written and point out where I'd called you stupid?

It's not a rant and how anyone can tell the level of venom intended from the written is beyond me. Perhaps it's the bias of the reader, rather than what I have actually written?

Anyway; despite the obvious rancour you have read into my posts I will continue to try and help.

1. Read the scheme fact sheets. They are written in easy to understand terms. Every calculation given above would have been accessible to you to form your own opinion of your options.

2. Do not listen to colleagues, even senior ones. My experience is that the level of understanding of the NHS pension is poor. This is because people tend to avoid finding out the facts from themselves and tend to be led by the opinions of others which is often wrong.

3. "I'm not financially savvy". This sounds like a way to abdicate responsibility. That is an opinion, not a criticism, and said with no venom. As the poster @zagubov says in his signature "there is no honour in not knowing something that can be known". The answer to your question requires no financial savvy, it is widely regarded as a "no brainer". Had you used the search function you would have found several similar threads all with the resounding message of "don't do it".

The advice I'm trying to impart (obviously poorly so far judging by the responses ) is that finding things out for yourself, then trusting your own judgement is a better model for reaching satisfactory outcomes than asking random others.

Yes, you had excellent advice, but what would you have done had the thread been responded to by your consultant friend who likes property and like minded individuals? Would your opt-out idea be further down the line?

Of course the Forum can be used to see what the general opinion on a subject.

But if the question asked, if a medical analogy can be used, is a bit like "should I start smoking fags" then some, (me) are surprised if it has been asked by someone with the attributes to find out for themselves.

I would also like a doctor that was proficient in medicine rather than finance, but also prefer someone who has taken on board the thoughts of someone who is suggesting/promoting a more self reliant model of making life changing decisions and is happy with the responsibility of doing so.

Anyway, don't opt out because a Consultant and another medical colleague tell you it's a good idea.

Don't not opt out because a dozen or so people you have never met tell you it's a good idea.

Up to you.