Has anyone every stopped themselves topping or buying more in DB Pensions...

Gimmeaminute

claire111 said:

I purchased NHS 'Additional Pension' some years ago (Different from AVCs, topping up etc).

At the time I calculated that providing I lived a further 10 years after taking retirement at age 65, that I would break even against the cost to me, and everything else would be 'Free Money'. 

Sorry to say I didn't consider the young'uns !

I've just looked at buying additional NHS pension. For an extra £4000 a year pension at 67 I was quoted a one off payment of £54,400 now or 11 years worth of instalments totalling £71,175. Both options mean that I won't break even till I'm in my eighties.

I think I'll stick to ISAs..

QrizB

Gimmeaminute said:

I've just looked at buying additional NHS pension. For an extra £4000 a year pension at 67 I was quoted a one off payment of £54,400 now or 11 years worth of instalments totalling £71,175. Both options mean that I won't break even till I'm in my eighties.

That's a pretty good deal. A £4k pa index-linked annuity would cost a 67-year-old something like £90k.

SouthCoastBoy

zagubov said:

AlanP_2 said:

zagubov said:

Surveys show you're better off working at least part-time after you retire, and better if it's in a familiar job.

Better off how? If you mean financially then surely that's obvious.

Strange how we all have our own view of the world isn't it? To me, working part time means you haven't retired.

There have been studies showing that retirees are happier or more satisfied if they continue to work but not full-time. I think this link relaters to that.

They get the benefits of structure, social contact, and yes financial benefits. It probably matters quite a lot how well you get on with your co-workers, customers, etc.

On the other hand amongst those re-employed retirees the happiest ones are those doing familiar work so there isn't a stressful steep learning curve.

Not sure I would rely on a survey, but would base it on your individual circumstances. 

AlanP_2

zagubov said:

AlanP_2 said:

zagubov said:

Surveys show you're better off working at least part-time after you retire, and better if it's in a familiar job.

Better off how? If you mean financially then surely that's obvious.

Strange how we all have our own view of the world isn't it? To me, working part time means you haven't retired.

There have been studies showing that retirees are happier or more satisfied if they continue to work but not full-time. I think this link relaters to that.

They get the benefits of structure, social contact, and yes financial benefits. It probably matters quite a lot how well you get on with your co-workers, customers, etc.

On the other hand amongst those re-employed retirees the happiest ones are those doing familiar work so there isn't a stressful steep learning curve.

And studies showing the opposite:

Not all research shows detrimental effects of retirement. Consistent with a number of studies, one recent study, across 12 Western European countries, using rigorous methods, showed that retirement can lead to improvements in self-reported health, across educational levels and for men and women alike.[ii] Further, in the US Normative Aging Study of men, although men’s physical health declined over three to four years, there were no differences between those who were still working and those who had retired.

Equally positive are the findings from recent German research.[iii] The study author concluded that retiring from work is good for your health, chiefly due to the benefits of more exercise, less stress and greater sleep enjoyed by people who stop working. In retirement, people are more likely to rate their health as satisfactory. Mental health improves, even after allowing for age-related medical problems and for those retired early due to ill health. The author estimated that the number of doctor visits reduced by 25 per cent for retirees compared to non-retirees of the same age, an important finding for the economics of the German health system. It would be interesting to see this research replicated in other countries.

https://www.bps.org.uk/psychologist/retirement-health-and-wellbeing (this article looks at the pros and cons, I've quoted from the cons to illustrate my point).

Like many things it isn't as straightforward as it may appear on the face of it.

Sarahspangles

It’s that ‘ikigai’ concept of finding something that you personally enjoy, that’s within your capabilities, and that you think is worthwhile. It may be paid, or not.

If it doesn’t involve social contact and staying active, you need to leave space for that too.

daveyjp

Gimmeaminute said:

claire111 said:

I purchased NHS 'Additional Pension' some years ago (Different from AVCs, topping up etc).

At the time I calculated that providing I lived a further 10 years after taking retirement at age 65, that I would break even against the cost to me, and everything else would be 'Free Money'. 

Sorry to say I didn't consider the young'uns !

I've just looked at buying additional NHS pension. For an extra £4000 a year pension at 67 I was quoted a one off payment of £54,400 now or 11 years worth of instalments totalling £71,175. Both options mean that I won't break even till I'm in my eighties.

I think I'll stick to ISAs..

Its also not purely about breaking even.  Its £80 a week for life index linked v £54,400 sat somewhere needing you to manage it potentially worrying how much to spend each year and how long it may last.

kpk2000

I have added £1250 of additional pension in TPS over the past couple of years but will be stopping after the current payment ends. I want to add to my ISA instead so I can retire early if I want to from 55 and the increase to 58 (for my SPA) in taking the TPS early is a factor that might rise so I prefer the flexibility.

My aim is for an ISA to cover 55-58, then a small SIPP from 58-60 (assuming I can still take this at 58 when the government changes SPA!) and then take all my TPS benefits (mix of FS NPA60 and CA68) at 60.

My aim is for flexibility so need to increase the ISA to give max flexibility in case of SPA changes impacting SIPP withdrawal age and not sure I can teach much beyond 55! I might teach beyond 55 or get another job but flexibility is my goal and having more Additional Pension is not really helping anymore given the increases to SPA/NPA. I value the possibility of early retirement over more yearly pension when I get there!

claire111

Gimmeaminute said:

claire111 said:

I purchased NHS 'Additional Pension' some years ago (Different from AVCs, topping up etc).

At the time I calculated that providing I lived a further 10 years after taking retirement at age 65, that I would break even against the cost to me, and everything else would be 'Free Money'. 

Sorry to say I didn't consider the young'uns !

I've just looked at buying additional NHS pension. For an extra £4000 a year pension at 67 I was quoted a one off payment of £54,400 now or 11 years worth of instalments totalling £71,175. Both options mean that I won't break even till I'm in my eighties.

I think I'll stick to ISAs..

Remember it is £54,400 less tax and NI ...  I expect to live to my late 80's, if I don't then so be it !

hugheskevi

claire111 said:

Gimmeaminute said:

claire111 said:

I purchased NHS 'Additional Pension' some years ago (Different from AVCs, topping up etc).

At the time I calculated that providing I lived a further 10 years after taking retirement at age 65, that I would break even against the cost to me, and everything else would be 'Free Money'. 

Sorry to say I didn't consider the young'uns !

I've just looked at buying additional NHS pension. For an extra £4000 a year pension at 67 I was quoted a one off payment of £54,400 now or 11 years worth of instalments totalling £71,175. Both options mean that I won't break even till I'm in my eighties.

I think I'll stick to ISAs..

Remember it is £54,400 less tax and NI ...  I expect to live to my late 80's, if I don't then so be it !

There is no NI saving as the purchase is not salary sacrifice.

There may not even be an income tax saving, given the awful 12:1 commutation rate means there is effectively no tax free lump sum. So for many it would be 20% relief on contribution but 20% tax when drawn.