NHS pension

ivrytwr3 · 16 Sep 2020 at 17:46

Public Sector pensions are still there, Fire, Police, NHS, Military. Some contributory, some non-contributory, albeit most have moved to CARE as oppose to DBS - but decent pension schemes are still available.

theone8181 · 16 Sep 2020 at 20:36

tom_nieto said:
The NHS pension scheme is still pretty good despite the 2015 changes. Is this her first NHS job?

The main issue with the NHS pension scheme is the heavy penalty on taking it early. Retiring at 55 means you would lose 45% of your contributions:
https://www.nhsbsa.nhs.uk/sites/default/files/2017-03/ARER factsheet (03.2017) V7.pdf

I certainly don't plan to be a 67 year old practicing surgeon, but living costs money!

Yes, she currently works for boots. I'm not sure what other penalties there are, I just assumed it would be whatever was paid in less a little bit.

tom_nieto · 16 Sep 2020 at 21:35

theone8181 said:
Yes, she currently works for boots. I'm not sure what other penalties there are, I just assumed it would be whatever was paid in less a little bit.

Less 45% if you go at 55! More than a little bit. I’d be furious to lose any of it to be honest.

Surveyor · 16 Sep 2020 at 21:46

theone8181 said:
Yes, she currently works for boots. I'm not sure what other penalties there are, I just assumed it would be whatever was paid in less a little bit.

tom_nieto said:
Less 45% if you go at 55! More than a little bit. I’d be furious to lose any of it to be honest.

They're not going to pay anywhere near the same amount if you're drawing the pension for 12 more years than someone who retires at 67.

theone8181 · 17 Sep 2020 at 06:31

It's worse than that as I was looking at it, they penalise you from retirement age (rather than a specific age) so you can bet if that went upto 70 (a real possibility) shed loose even more. What I can't understand is what the benefit of the company paying in is, i.e., whether they put 10% or 100% of your salary in, surely your final salary is the same? I do think 45% is a joke, although she won't have a massive amount in it. Guess she'll have to work till she drops

. I know it's a long way away, I wonder if her dropping to part time would make a difference to her payout.

tom_nieto · 17 Sep 2020 at 06:41

Surveyor said:
They're not going to pay anywhere near the same amount if you're drawing the pension for 12 more years than someone who retires at 67.

I’d be serving 27% less time if I retired at 55 rather than 67, so losing 45% of the pension seems rough (and that would be after a mere 32 years of service).

Surveyor · 17 Sep 2020 at 07:59

tom_nieto said:
I’d be serving 27% less time if I retired at 55 rather than 67, so losing 45% of the pension seems rough (and that would be after a mere 32 years of service).

If you retired at 55 instead of 67 then, on average, you'd be drawing the pension for nearly twice as long.

Bald-Eagle22 · 17 Sep 2020 at 09:42

Kill_Phil said:
Yeah of course people need to plan for retirement but the goals posts are constantly shifting cause the numbers aren't sustainable.

The days of gold plated pensions are over and everyone else is having to pay for them

Aint that the truth - I’ve only just discovered my AFPS75 give me a 3x annual pension payment when I claim at age 60 £21k in today’s money

and 7 k a year . I hate to think how much money I would have to pay into a private fund to get that now !? Oh it’s index linked as well .

tom_nieto · 17 Sep 2020 at 10:07

Surveyor said:
If you retired at 55 instead of 67 then, on average, you'd be drawing the pension for nearly twice as long.

Probably more than that given how people tend to drop dead if they retire later.

Good way of thinking about it and making it a less bitter pill to swallow though. It does still seem very punitive though.

SexyGreyFox · 17 Sep 2020 at 10:41

How many % will I lose retiring 3 years early?

Surveyor · 17 Sep 2020 at 11:00

SexyGreyFox said:
How many % will I lose retiring 3 years early?

It depends on which scheme(s) you're in and how old you'll be. The normal pension age is different for each scheme:

60 for the 1995 section
65 for the 2008 section
State pension age or 65 (if later) for the 2015 scheme

This link was provided earlier in the thread: NHS Pensions - Actuarially Reduced Early Retirement

Trifid · 17 Sep 2020 at 11:33

tom_nieto said:
I’d be serving 27% less time if I retired at 55 rather than 67, so losing 45% of the pension seems rough (and that would be after a mere 32 years of service).

Also consider the actual amount you take out of the pension with the use of the 20% income tax threshold. It will also only be 10 years early that you can withdraw it due to change in pension law. (Assuming you stop working all together, and can afford to with the amount you built up at that point). And if they means test the state pension, you are more likely to receive this income (or more of it) if your workplace pension is lower.