jennyhbk

Paying into Police pension

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I had 30 years service October 2016, decided to carry on working. Just need some info...a colleague of mine asked if I have my 30 yrs in, why am I still paying into the pension, where I could be saving that money each month.....so... can anyone tell me what do I benefit in still paying into the pension?

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Jenny, as I understand it (ive got 28 1/2 in so not that far behind) absolutely nothing, its in effect dead money.

I would speak with Fed and pensions to confirm, but once you have 30 years pensionable service thats it, you cant get anything more.

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As it's a final salary pension then your pension is based on salary at the time you retire or stop paying into it. Your benefit or not of continuing to pay contributions depends on how long and how much your salary increases between 30 years service and retirement.
It may be that with 1% pay rise cap it will take a long retirement to recoup the contributions but if your salary increased by more e.g. you were promoted then it would be worth it.
Best get proper financial advice before just stopping contributions.


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I would have thought with the new pension scheme in where everyone has to pay pension until retirement or death, whatever is first, then this part of the 1987 scheme should have been scrapped.

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I would have thought with the new pension scheme in where everyone has to pay pension until retirement or death, whatever is first, then this part of the 1987 scheme should have been scrapped.

No. She would be fully protected on the final salary scheme.


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13 hours ago, jennyhbk said:

I had 30 years service October 2016, decided to carry on working. Just need some info...a colleague of mine asked if I have my 30 yrs in, why am I still paying into the pension, where I could be saving that money each month.....so... can anyone tell me what do I benefit in still paying into the pension?

Jenny you could ask, why are you still working. In effect yu are working for free as you could almost have the same money available if you were retired. Depending on your age the acturial figure for working out your Lump Sum commutation stats to decreaase. Ok you will be either half pay with a commutation figure or two thirds with smaller. When you take your pension you will be better off by the amount of your contributions which you no longer pay. You do not have the travel expenses, or the meal expense. I found it hasrd to believe when I retired as I took home about £30 per month less than when working full time.

I do agree though check with your pension experts in the Federatuion and the Pay and Pensions Dept.

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...check with your pension experts in the Federatuion and the Pay and Pensions Dept.

Eh? The what now?
There are no pension, or financial experts in the Federation. Their stock answer is that they don't give financial advice.
And the pay dept will tell you to contact the pension provider, who will give you facts and figures but no advice.



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Isn't it possible to just stop paying into the pension? Or must you remain in the pension scheme?

Each to their own, but cops remaining at work when they could be getting their pension has always baffled me. They are effectively working for next to nothing, seeing as they could be receiving a nice pension for not working. Ok, its a reduced income but then you have to consider you aren't paying into your pension anymore, which boosts it back up to something similar to your current wage.

The only way I would keep working for the police after qualifying for retirement is by retiring and then returning to work as civilian staff, that way you get your pension and your salary.

 

 

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2 hours ago, Reasonable Man said:


Eh? The what now?
There are no pension, or financial experts in the Federation. Their stock answer is that they don't give financial advice.
And the pay dept will tell you to contact the pension provider, who will give you facts and figures but no advice.

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The Federation can tell you exactly what you can expect to receive as a pension and what sum you can commute.  That is not the same as financial advice it is a matter of fact. It is then up to you as an individual to seek further expert advice from an independent adviser.

You can opt out of the pension scheme but would be a fool to do so. There is no Pension  fund existing that can provide you with the Pension and Cover that the Police Pension Regulations provide. That is within the old regulations or the new.

If you decide to opt out of the scheme then you had better be prepared to exist on no financial support.

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Very simple sums - Constable with 30 years pensionable service will be on £37,254. So a full pension will be £24,836.
If you stopped paying contributions at 30 years then this will always be your starting pension when you retire. If you stay another year and keep paying contributions you will pay out £4,098 (plus a bit more for when you get the pay rise). As it is tax free then if you stop paying contributions you will be better off by £3,278 for the year (plus the bit).
In 1 year your salary will be 1% more - £37,627 so your full pension will be £25,085 = £249 more for £3,278 contributions.
You will break even at just over 13 years.
If, like me, you intend on drawing your pension for at least as long as you paid in then you will draw back £7,470 for a £3,278 investment.
Of course if you die after a year of pension you'd be worse off, but you wouldn't care.
As said these are very simple sums and if you take a lump sum so have a reduced pension there are many variables to include. It also depends on how long more you serve and what the pay rises are over that time.
Hence you need to ask a professional financial/pension adviser.
Or Cheese? Where's Cheese?


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On 10 July 2017 at 11:13, Reasonable Man said:


No. She would be fully protected on the final salary scheme.


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I said should have been scrapped, it was not but should have been brought in with the new pension scheme.

 

What is the point in officers being transferred to the 2015 scheme and protected officers are working 30yrs, stopping their payments and carrying on working and receiving maximum benefit when everyone else is losing money……wrong……. totally wrong in my view……..I spoke out regarding this on the old site and was shouted down and still speak out about this today, the the middle third officers are suffering the most. 

Lets correct the wrong and stop this happening……………...all officers pay pension to retirement or death………..simple.

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I said should have been scrapped, it was not but should have been brought in with the new pension scheme.
 
What is the point in officers being transferred to the 2015 scheme and protected officers are working 30yrs, stopping their payments and carrying on working and receiving maximum benefit when everyone else is losing money……wrong……. totally wrong in my view……..I spoke out regarding this on the old site and was shouted down and still speak out about this today, the the middle third officers are suffering the most. 
Lets correct the wrong and stop this happening……………...all officers pay pension to retirement or death………..simple.

I guess they didn't listen to you. Perhaps they thought that it was better that not everyone lost out.


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On 04/10/2017 at 20:24, Mark101 said:

I said should have been scrapped, it was not but should have been brought in with the new pension scheme.

 

What is the point in officers being transferred to the 2015 scheme and protected officers are working 30yrs, stopping their payments and carrying on working and receiving maximum benefit when everyone else is losing money……wrong……. totally wrong in my view……..I spoke out regarding this on the old site and was shouted down and still speak out about this today, the the middle third officers are suffering the most. 

Lets correct the wrong and stop this happening……………...all officers pay pension to retirement or death………..simple.

In in all honesty you can stop paying into both schemes as and when you like. I don’t quite see what you are getting at? What maximum benefit are they getting? 

If you carry on paying in the new scheme then you will always accrue more pension. In the old scheme you don’t, even though you are paying extra. Surely that’s unfair towards people in the older scheme?

If all officers have to continue paying into it until retirement then they should accrue more pension. Fair?

 

 

 

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