NHS Pension

tibbles209

Another vote here for joining the pension ASAP. Your access to the NHS pension scheme constitutes a significant portion of your renumeration package. If you are handing that benefit back it is akin to volunteering for a fairly hefty pay cut. Your pension-age self will be incredibly grateful one day that you made this investment for them.

cloud_dog

(As often commented on these types of posts....)

Lukas, as a tax payer I wholeheartedly endorse your choice and would like to thank you for your sacrifice for our country and benefit.

On a more serious note...seriously!

crv1963

Lukas- by virtue of your banding you are not daft! Who on earth told you opting out made sense? As someone looking forward to soon take my NHS Pension you are making by far the biggest financial mistake of your life by opting out.

Talk to your none NHS mates and ask them how much they need to pay per month for an inflation guaranteed pension based on their salary and life cover and a pension for spouse and if in education childrens pension. I confidently expect that it is more expensive than the 9.5% of salary it will cost you!

It costs you 9.5% and your employer 22-24% of your salary. Get onto your pension officer today!

SonOf

I'm approaching my 2rd year in the NHS and have yet to contribute to a pension. From my limited research it seems the NHS pension scheme is one of the better options but i'm reluctant because of the contribution percentages.

Contribution levels that that are lower than any potential alternative needs to be. People in the private sector would kill for a pension that good at such low cost.

If i'm not wrong, i'd have to contribute a defined amount which would equate to nearly £400 a month (pre-tax). This is a pretty hefty pill to swallow as i'm a 1st-year homeowner and trying to become debt free (other than the mortgage - about 3 months shy at present). Its money locked away that i'd make good use of.

There will be excuses you can use most of your life if you decide to play that game. Your older self will consider your younger self a complete fool if you decide to opt out of the NHS Pension.

I'm 26 and otherwise invest in S&S for what its worth.

For what it is worth, you would need to pay almost 30% of your salary into the S&S ISA to stand even a chance of getting close to the amounts you will get out of the NHS pension.

People wtih defined contribution schemes are told to pay in around half their age as a percentage as a rough guide to getting back a reasonable pension at state pension age. That is 13% in your case. However, you have the chance to pay just 9% before tax relief and NI reduction and get so much more for that.

It would be the worst financial decision of your life to opt out. And if you cannot see that, then you would also need to question your judgement skills. Something patients may have to rely on.

Lukas239

Well crikey, you lot don't mess about. Very much appreciate your input and honesty.

Have set the ball rolling and asked to be enrolled. Can't get it backdated obviously but better late than never.

Just to claw back a tiny bit of dignity, it wasn't my choice not to be enrolled, was originally told I didn't qualify which was clearly wrong.

cloud_dog

Well done.

Perhaps seasoned posters can be a little blunt but that is because they understand the real benefit, the real value of what you [STRIKE]are[/STRIKE] were going to ignore.

Lukas239

No I really would rather a definitive answer and I'm greatful for it. Finance needs to be void of emotion I think and this has been so I'm thankful.

hugheskevi

Have set the ball rolling and asked to be enrolled. Can't get it backdated obviously but better late than never.

Just to claw back a tiny bit of dignity, it wasn't my choice not to be enrolled, was originally told I didn't qualify which was clearly wrong.

That sounds like a potential breach of automatic enrolment requirements (assuming your employer had reached their staging date, which seems likely).

You could try querying that point with your employer, asking to be admitted to the scheme from date of joining.

Andy_L

SonOf wrote: »

Contribution levels that that are lower than any potential alternative needs to be. People in the private sector would kill for a pension that good at such low cost.

Seems excessive when they could just get a job with the NHS

https://www.jobs.nhs.uk/

20522 live job vacancies at the time of posting

crv1963

Well done, it actually doesn't seem that costly once you get used to it! Watch out for work related expenses that can reduce eventual pension- I work with others who all have lease cars costing several to many 100s of pounds per month, which is great but is a drag on their eventual pension. I also work with a Consultant who drives a lease i10 because it only costs him £35 pm so negligible impact on his pension.

There are means to buy earlier retirement or using AVC a lump sum with the 2015 scheme. Have a good read of the information you will be sent and if needed ask Pension Officer, on here or colleagues (most of whom in my experience will yawn!!).