Teachers' Pension — Flexibilities, Or Something Else?

likesallweather

I am in TPS. I've only ever worked part time, working part time for my company as director too. I'm mid forties. My statement shows £13.5k total pension (if I was retirement age today — career average and 80th combined) and a 21k lump sum (80th). I've always bought flexibilities when I can — units of £250 extra pension, of which you can buy 32 in total, at any point before retiring. 

My questions. I can buy 14 more units (I have bought 18 already). Should I? This would 'max' the amount of these I can buy. If I leave teaching, maybe there's a better company director pension I could use the money in?

My plan was to max, then leave teaching and start a new company director pension. I don't need access to the money but I am risk averse.

The unit price of these flexibilities has gone up hugely it seems. I bought 12 last year (12x£250/year extra pension) for £35k. This year, 14 would be 52k. I have a feeling if I'd done it a couple of weeks ago I could have saved a lot of money.

Any thoughts would be appreciated. Thanks.

Dazed_and_C0nfused

likesallweather said:

I am in TPS. I've only ever worked part time, working part time for my company as director too. I'm mid forties. My statement shows £13.5k total pension (if I was retirement age today — career average and 80th combined) and a 21k lump sum (80th). I've always bought flexibilities when I can — units of £250 extra pension, of which you can buy 32 in total, at any point before retiring. 

My questions. I can buy 14 more units (I have bought 18 already). Should I? This would 'max' the amount of these I can buy. If I leave teaching, maybe there's a better company director pension I could use the money in?

My plan was to max, then leave teaching and start a new company director pension. I don't need access to the money but I am risk averse.

The unit price of these flexibilities has gone up hugely it seems. I bought 12 last year (12x£250/year extra pension) for £35k. This year, 14 would be 52k. I have a feeling if I'd done it a couple of weeks ago I could have saved a lot of money.

Any thoughts would be appreciated. Thanks.

Did you buy those 12 units with a lump sum payment?

If so what have you done about the tax relief?

Do you pay yourself enough from your directorship to allow such a large one off contribution?

Or when you say part time in TPS is it a high salary role that is only a little bit part time?

likesallweather

Dazed_and_C0nfused said:

likesallweather said:

I am in TPS. I've only ever worked part time, working part time for my company as director too. I'm mid forties. My statement shows £13.5k total pension (if I was retirement age today — career average and 80th combined) and a 21k lump sum (80th). I've always bought flexibilities when I can — units of £250 extra pension, of which you can buy 32 in total, at any point before retiring. 

My questions. I can buy 14 more units (I have bought 18 already). Should I? This would 'max' the amount of these I can buy. If I leave teaching, maybe there's a better company director pension I could use the money in?

My plan was to max, then leave teaching and start a new company director pension. I don't need access to the money but I am risk averse.

The unit price of these flexibilities has gone up hugely it seems. I bought 12 last year (12x£250/year extra pension) for £35k. This year, 14 would be 52k. I have a feeling if I'd done it a couple of weeks ago I could have saved a lot of money.

Any thoughts would be appreciated. Thanks.

Did you buy those 12 units with a lump sum payment?

If so what have you done about the tax relief?

Do you pay yourself enough from your directorship to allow such a large one off contribution?

Or when you say part time in TPS is it a high salary role that is only a little bit part time?

Yes 12 units were lump sum, paid from the company, which was ok for last year in terms of salary and tax relief. My teaching is 0.5 FTE. So my guesswork behind buying flexibilities is that 'it all adds up' and will help to close the gap, as if I'd been working full time.

IAMIAM

likesallweather said:

I am in TPS. I've only ever worked part time, working part time for my company as director too. I'm mid forties. My statement shows £13.5k total pension (if I was retirement age today — career average and 80th combined) and a 21k lump sum (80th). I've always bought flexibilities when I can — units of £250 extra pension, of which you can buy 32 in total, at any point before retiring. 

My questions. I can buy 14 more units (I have bought 18 already). Should I? This would 'max' the amount of these I can buy. If I leave teaching, maybe there's a better company director pension I could use the money in?

My plan was to max, then leave teaching and start a new company director pension. I don't need access to the money but I am risk averse.

The unit price of these flexibilities has gone up hugely it seems. I bought 12 last year (12x£250/year extra pension) for £35k. This year, 14 would be 52k. I have a feeling if I'd done it a couple of weeks ago I could have saved a lot of money.

Any thoughts would be appreciated. Thanks.

Agreed. I have just seen the price has nearly doubled! 

FIREDreamer

IAMIAM said:

likesallweather said:

I am in TPS. I've only ever worked part time, working part time for my company as director too. I'm mid forties. My statement shows £13.5k total pension (if I was retirement age today — career average and 80th combined) and a 21k lump sum (80th). I've always bought flexibilities when I can — units of £250 extra pension, of which you can buy 32 in total, at any point before retiring. 

My questions. I can buy 14 more units (I have bought 18 already). Should I? This would 'max' the amount of these I can buy. If I leave teaching, maybe there's a better company director pension I could use the money in?

My plan was to max, then leave teaching and start a new company director pension. I don't need access to the money but I am risk averse.

The unit price of these flexibilities has gone up hugely it seems. I bought 12 last year (12x£250/year extra pension) for £35k. This year, 14 would be 52k. I have a feeling if I'd done it a couple of weeks ago I could have saved a lot of money.

Any thoughts would be appreciated. Thanks.

Agreed. I have just seen the price has nearly doubled! 

Not a member but seems counterintuitive ro me. Annuity rates have risen significantly in tne last couple of years so would have expected the cost of additional pension to go down.

hugheskevi

FIREDreamer said:

IAMIAM said:

likesallweather said:

I am in TPS. I've only ever worked part time, working part time for my company as director too. I'm mid forties. My statement shows £13.5k total pension (if I was retirement age today — career average and 80th combined) and a 21k lump sum (80th). I've always bought flexibilities when I can — units of £250 extra pension, of which you can buy 32 in total, at any point before retiring. 

My questions. I can buy 14 more units (I have bought 18 already). Should I? This would 'max' the amount of these I can buy. If I leave teaching, maybe there's a better company director pension I could use the money in?

My plan was to max, then leave teaching and start a new company director pension. I don't need access to the money but I am risk averse.

The unit price of these flexibilities has gone up hugely it seems. I bought 12 last year (12x£250/year extra pension) for £35k. This year, 14 would be 52k. I have a feeling if I'd done it a couple of weeks ago I could have saved a lot of money.

Any thoughts would be appreciated. Thanks.

Agreed. I have just seen the price has nearly doubled! 

Not a member but seems counterintuitive ro me. Annuity rates have risen significantly in tne last couple of years so would have expected the cost of additional pension to go down.

Public sector pension pricing is not based on market rates, but instead priced using expected GDP growth, as forecast by OBR.

That has reduced considerably over the past decade, particularly after Brexit, which has significantly increased the price of voluntary benefits.

IAMIAM

£250 APB cost me £195 per month 1st March, now costs me £260 per month 1st April

likesallweather

IAMIAM said:

£250 APB cost me £195 per month 1st March, now costs me £260 per month 1st April

crazy increase. I might see what else there is available. Reluctant to pay so much for something that was way less expensive last month!