Should I transfer into my teachers pension - more complicated than it seems

catsbeep38

I'm 48 and have just retrained as a teacher so I now have a teachers pension. 

As well as teaching I am likely to retain some freelance income and would like to put some of that into a pension (it is likely to be about half my income so not a small side gig but a second job as I teach part time).

I can't top up my teachers pension from this money - payments in can only come from eligible work in schools / colleges.

I have a pension with 20,000 in it from a previous employer that I've been adding to from my freelance income. It charges 1%.

Should I keep it and keep adding to it on the grounds that pensions work grow faster the more money is in them.

Or should I transfer it into my teachers pension to boost that considerably, and start again with a stakeholder pension for my freelance income?

I'm not planning to retire until I'm 70.

What would you do and why?

MallyGirl

I'd probably start by getting a quote of what that £20k would buy me in the TPS

Dazed_and_C0nfused

catsbeep38 said:

I'm 48 and have just retrained as a teacher so I now have a teachers pension. 

As well as teaching I am likely to retain some freelance income and would like to put some of that into a pension (it is likely to be about half my income so not a small side gig but a second job as I teach part time).

I can't top up my teachers pension from this money - payments in can only come from eligible work in schools / colleges.

I have a pension with 20,000 in it from a previous employer that I've been adding to from my freelance income. It charges 1%.

Should I keep it and keep adding to it on the grounds that pensions work grow faster the more money is in them.

Or should I transfer it into my teachers pension to boost that considerably, and start again with a stakeholder pension for my freelance income?

I'm not planning to retire until I'm 70.

What would you do and why?

Not sure that is strictly true but assuming it is why not make extra contributions from your teachers pay (there will doubtless be a variety of options for extra contributions with TPS being a DB scheme) and use your freelance income to live on?

Have you had a quote for what the £20k would buy in TPS?

Why a stakeholder pension?  They are a bit of a niche product these days.

NB.  I'm assuming you are aufair with the difference between DB and DC schemes.

catsbeep38

I only mentioned stakeholder pension because I thought they were easer to manage. 

I agree it would be a good idea to maximise the pension contributions but would still probably want to opportunity to top up from freelance income.

But actually getting  quote from teachers pensions is so obvious and I hadn't thought of it!! So thank you!

dunstonh

I only mentioned stakeholder pension because I thought they were easer to manage. 

In 2001 yes.   Today they are niche, almost obsolete and only a couple still exist for new business.

Marcon

catsbeep38 said:

Should I keep it and keep adding to it on the grounds that pensions work grow faster the more money is in them.

Only if the charges are 'tiered' and you are charged less if you have a certain amount saved in a particular (DC) scheme.

Silvertabby

It's still worth getting a transfer in quote from TPS, just so you can weigh up all the odds.  But don't dawdle - there's a 12 month limit on transfers in.

Al_Blouse

At the moment, the Teacher website is inundated with sorting out retired affected by the Macleod judgement so start querying asap.

Yorkie1

Even though your current plans are to keep working until 70, it might be worth reflecting on what you would do if you changed your mind / circumstances changed and you wanted to retire before TP retirement age and/or state pension age (the latter would probably be 68 for you).

Anything in a SIPP can be taken from 55 (shortly to rise to 57), so could help fill any gap. I don't know about TP AVC rules. This may not be a relevant consideration for you, and you may have other savings that you could rely on in this eventuality, but bear it in mind once you get your quote from TP. 

catsbeep38

Thank you everyone!! Super helpful.