Teacher Pension Flexibilities INCREASE

FIRSTTIMER

Hi,

After some advice. I participate in this scheme and have paid for 3 year buy out within the Career Average. I have to pay 2.1% for this in order to take full benefits at current age 65 instead of 68.

I have now had a letter stating the following.....

Total Flexibilities available in TPS £7000.

Buy Out is 2.1% and now has a value of £4200

Faster Accrual (1/45), last year was 6% extra payments, this year has increased massively to 7.5% if I want it.

After the above two, I only have £2200 left to buy in flexibilities which could be around 4-5 years of payments at 1/45.

What I am querying is the faster accrual bit and whether it is actually worth it now that it has increased massively, The only explanation I have got from TPS is that the revaluation has been completed this year and the rates have gone up. Part of me is happy I paid the buy out and fixed at 2.1%, however to get the full £7000 seems likes its going to cost a fortune via FA just for an extra 2-3k at retirement. I have also noticed the value of the 3 year buy out keeps increasing so that is hammering the amount of the £7000 I can purchase as extra....

OldBeanz

Not sure about the costs but I know in the Civil Service the price ramped up the nearer you got to pensionable age. My son, on the other hand, >30, who has just joined the TPS, was given very attractive rates over 5 years.

FIRSTTIMER

Thanks for this

Oliver1191

Maybe consider a mix of apb and faster accrural? I was under the impression that faster accruaral was better if you were in the scheme working for a long time as it benefits by the annual 1.6% increase. However, givrn the future is always unpredictable, apb might better.