NHS pension

[zizza]

Can someone explain in clear English how the NHS pension amount is worked out?! Specifically, what difference would it make if I go up from a band 5 to a band 6 - someone said the amount is based on your last 3 years salary. I've never really got my head round it because it won't be worth much anyway but every little will help!

Bumping, because I am baffled by my pension tbh.

It depends which scheme you are but for most people it’s an career average now, not last 3 years

Your employer can advise you where to get the information and a pension forecast based on your salary. Have you asked them?

There is a NHS pensions Facebook group ran by absolute geniuses who know everything about it.

It’s pretty simple to understand once you know how! Assuming you’re on the most recent scheme, every year you accrue 1/54th of your salary for that year.

So, say you earn £27,000 in a year, you will accrue a £500 pension.

Say you earn £27,000 every year for four years, and then leave the NHS, you will have accrued £2,000 for those four years.

That £2,000 will be paid to you in retirement every single year. It’s called a ‘defined benefit’ pension and is very valuable, as you accrue guaranteed pension payments for much less money (in terms of your monthly contributions) than if you had a private pension, or a ‘defined contribution’ pension as with the majority of other employers.

So, OP, look at the annual salary for your new job, divide it by 54 and that is what you will accrue every year. The more you earn, the more you accrue!

Hope that made sense @zizza?

Thank you so much @LemonSpring . That's exactly what I was after as I remember someone explaining it like that in the past and I'd forgotten the detail!

@daffodilandtulip thanks for that, I'll go and have a look for the group

I've got really small amounts in the earlier plans from when I'd done short bank stints in the NHS, but in recent years I've been working 30 hrs and now full-time in the 2015 plan so that's the one I keep an eye on. I'm considering going for a B6 job but I'm at the top of B5 which would mean I'd get the grand sum of an extra £44 net pay per month woo hoo (and further to travel so I'd actually be slightly worse off). Then 2 years before it goes up, but at least it'll add a bit more into the pension I suppose (and it's a more interesting job

Thank you for explaining it so well! I've got a follow up question. Are 'defined benefit' pensions actually valuable though, in the face of inflation? Adding £500 per year to a pension sounds a lot now, but when I retire in 40 years time £500 might not actually be anything!

There is an amazing woman called Laura who runs a company called Pen-gage. She has unbelievable knowledge about public sector pensions & she explains it so well.
She has a website of the same name but is also on Facebook. Look her up - she gives better advice than NHS pensions. She also runs free seminars.

I went from Band 6 to 7 and got a truckload more stress for hardly any more money but 2 years on, I got a £2k increment and yes, it increases pension.

Main thing is whether you would enjoy the job. Nursing is hard if you aren’t enjoying it!

@Preggers101 for the nhs pension at least there’s also an increase added each year based on inflation + 1.5% so that the £500 added this year is worth the equivalent of £500 in ten/twenty years

The other thing with going from b5 to band 6, is that you will eventually get to the top of that band, which is a bit more , and once your a band 6 your in a better place to apply for a band 7 role in the future

Yes - to simplify it I didn’t mention that the amount is topped up by inflation every year, so it keeps track with the real term value of money! So £2000 now will actually turn out to be much more by the time you actually retire!

She's amazing! Spoke to her yesterday and she's done DH - his is more complex.

Thank you everyone.

Just to clarify - I'm in an admin role, not nursing. The job is more interesting, and I have an ex-colleague / friend who's part of the team (same role) so I know what I'd be letting myself in for 😆.

I'm hoping to only be working for another 4 years so I'd go up one pay step in that time