Pension refund not claimed

Flugelhorn

dantaden said:

p00hsticks said:

Your NHS pension doesn;t consist of investments in the same way that your SIPP does - it's a guarantee to pay you a specific amount of money for life on retirement depending on your length of service and pay. You will have been a very good investor if your SIPP  provides anywhere near the same amount of benefits that putting the same amount of money into the NHS pension would. 

I am trying to read and understand. Still gaining financial knowledge about how things work and stuff.
You make a very good point. But for opting-in NHS Pension, the agency reduces the hourly rate by 10% upfront. Which made me look for alternatives and I found SIPP. 

the reduction will be because the employer will be paying the employers contribution to the pension scheme (which I seem to remember is quite a lot) 
honestly don't give up on the NHS pension! it is the only place as an effectively self employed person you can get into a really good occupational pension 

Dazed_and_C0nfused

dantaden said:

p00hsticks said:

Your NHS pension doesn;t consist of investments in the same way that your SIPP does - it's a guarantee to pay you a specific amount of money for life on retirement depending on your length of service and pay. You will have been a very good investor if your SIPP  provides anywhere near the same amount of benefits that putting the same amount of money into the NHS pension would. 

I am trying to read and understand. Still gaining financial knowledge about how things work and stuff.
You make a very good point. But for opting-in NHS Pension, the agency reduces the hourly rate by 10% upfront. Which made me look for alternatives and I found SIPP. 

I fear you mean you opted out again.

You really do need to understand the benefit of the NHS pension scheme and how it works.

If you can make a SIPP work for you that gives a better return than that 10% would be buying in the NHS scheme you must be an investment genius.

Flugelhorn

I am not sure that he has opted out again - that requires the filling in of the SD502 forms which any HR dept then has to have to stop payments to the scheme - I suspect that this just means that not all of his work gets pensioned.

The 10% will be part of the employers contribution - he'll be paying his own contributions separately 

Supposedly everything you do has to get reported and pensioned to ensure that the correct % is accounted for in the contributions ie they don't want you not paying in one job / set of locums because it will take you over the threshold for contributions on everything. 
 I had times when I was out of time in submitting pension forms for locums and the amounts were not credited  (there was a few months in which to do it but disorganisation took over sometimes) 

dantaden

@Flugelhorn @Dazed_and_C0nfused
It seems that I have limited understanding of NHS Pension scheme. I appreciate both of you trying to point me right direction.

I will have to read more about NHS Pension scheme.

Flugelhorn

dantaden said:

@Flugelhorn @Dazed_and_C0nfused
It seems that I have limited understanding of NHS Pension scheme. I appreciate both of you trying to point me right direction.

I will have to read more about NHS Pension scheme.

definitely need to read more about it - it is complex but worth getting to understand it. While you are learning - just keep paying! 38 years ago I started my first house job and had to fill in loads of forms - chap said "fill this in, its the pension form - when you are 60 you will be glad you did" - and I am very glad I listened to him.

Dazed_and_C0nfused

dantaden said:

@Flugelhorn @Dazed_and_C0nfused
It seems that I have limited understanding of NHS Pension scheme. I appreciate both of you trying to point me right direction.

I will have to read more about NHS Pension scheme.

Instead of building up a pot of money you accrue a set amount each year which is then revalued each year for inflation until it starts being paid as a pension.  And then continues to be revalued for inflation once in payment, albeit not quite as generously I don't think.

Say for example you earn £60,000.  Your pension contributions would be £7,500 but as they are paid under the net pay method your taxable pay is reduced to £52,500 and the real cost of the £7,500 is only £4,500. 

In return you accrue a pension of £1,110 😃.

Which is increased for inflation each year until it becomes payable.  I think the inflation increase is RPI or CPI plus 1.5%, so fairly generous.

Might be different for some staff but defo worth reading up on the scheme rules.  It is a very valuable part of your remuneration.

JoeCrystal

dantaden said:

@Flugelhorn @Dazed_and_C0nfused
It seems that I have limited understanding of NHS Pension scheme. I appreciate both of you trying to point me right direction.

I will have to read more about NHS Pension scheme.

Please do! If you do opt-out, though, I, as a taxpayer, thank you for doing so since you saved the NHS and HM Treasury loads of money! I can't believe there are still people who opt out of one of the most generous pension schemes in the country!

Indeed, in theory (although likely to be very rare), an NHS pension member can retire on 100% of their salary with full-service thanks to highly generous accrual rates.

Seriously, read, learn and understand your pension scheme in full. Your future self thanks you. 

Marcon

dantaden said:

@Flugelhorn @Dazed_and_C0nfused
It seems that I have limited understanding of NHS Pension scheme. I appreciate both of you trying to point me right direction.

I will have to read more about NHS Pension scheme.

Or here's the potted summary(!): it's a fantastic pension scheme and opting out is a seriously bad idea for the vast majority of people who are eligible to join. The exceptions are the very high paid who have already built up pension benefits in excess of £1m.

dantaden

I feel humbled by all your suggestions.
I will keep enrolled in NHS Pension scheme and meanwhile gain better understanding of it.
Once I know the facts then I will decide to keep it or any other alternative

p00hsticks

Dazed_and_C0nfused said:

dantaden said:

@Flugelhorn @Dazed_and_C0nfused
It seems that I have limited understanding of NHS Pension scheme. I appreciate both of you trying to point me right direction.

I will have to read more about NHS Pension scheme.

Say for example you earn £60,000.  Your pension contributions would be £7,500 but as they are paid under the net pay method your taxable pay is reduced to £52,500 and the real cost of the £7,500 is only £4,500.

In return you accrue a pension of £1,110 😃.

Which is increased for inflation each year until it becomes payable.  I think the inflation increase is RPI or CPI plus 1.5%, so fairly generous.

And just to make it clear (because we quite frequently get people who don;t appreciate this), that's a pension of £1,110 a year, paid every year from when you reach the normal pension retirement age to when you die.

And the next year you work you will accumulate a similar sum which is added to that, so after working there for  ten years you ahve built up an annual pension entitlement of  £11,000 plus, increased yearly by an inflation figure