NHS pension

bshan

I have been a teaching assistant for 17 years and only just returning to nursing so was hoping to work for the next ten years as a nurse. Which would mean retiring at 67. 

annacommander

Hi
I am in the NHS pension scheme and have a total of 18 full years service. (have worked part time for 30 years in NHS) I have got an inheritance of £50.000 and thought that putting into my NHS pension would be a good way of investing it in order to boost my NHS pension. I am almost 59 years of age. I am in both the 1995 and 2015 scheme. Is this the best way of investing the money for my pension?

Moonwolf

annacommander said:

Hi
I am in the NHS pension scheme and have a total of 18 full years service. (have worked part time for 30 years in NHS) I have got an inheritance of £50.000 and thought that putting into my NHS pension would be a good way of investing it in order to boost my NHS pension. I am almost 59 years of age. I am in both the 1995 and 2015 scheme. Is this the best way of investing the money for my pension?

It depends what you want to do, when you want to retire, do you have people you want to leave money to, how much other cash savings do you have for emergencies?  Emergency cash is always good, but you will get a lump sum form the 1995 scheme next birthday if you take that pension at 60. Would it be worth delaying taking your 1995 pension, can you enhance your final salary if you don't have a break of service and don't need the pension now.

If you pay all the £50k this year you will need to check you don't breach the annual allowance and you can't pay in more than you have earned.  There is carry forward but you need to work out how much the value of your current pensions has changed.

You could buy additional pension.  It is good value for what you get, there is a calculator on NHSBSA website which will give you an estimate of the cost.  In the 2015 scheme the pension you already have grows by CPI + 1.5% but additional pension only grows by CPI.  You can ignore a partner or assign some to a partner on your death, allowing for a beneficiary gets you less pension.

If you put it into a separate non NHS defined contribution pension scheme.  You immediately get an extra 20% for the tax, you  could then draw on this if you wanted to retire early, and use it to cover until your are 67 and your 2015 and state pensions kick in, or leave it to grow as a tax free inheritance, or a bit of both.  I like the flexibility of this but arguably you might be getting less value.