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Moving existing pensions to a Local Authority scheme

6 replies

SymphonyofShadows · 14/04/2015 18:56

Long, sorry! I am on a break from my usual work, which is as a s/emp contractor due to some caring demands that have happened quite suddenly. I have been offered a few hours at a local school doing something that is related to my usual techie job on a zero hours contract. This is initally going to be a couple of part time days a week but could grow if the project takes off and the caring needs lessen.

They have offered me the option to join their local authority pension scheme. I will probably take it up even though it means I will be paying in a good chunk of my meagre earnings, but this is ok. I also have 2 other pensions, one worth around £25k from years ago when I contracted out of SERPS. This is growing slightly each year and is with Scottish Widows. I also have a workplace pension from years back which is worth a couple of thousand at the most. I am tempted to shift both of these into the local authority scheme as I understand that public sector pensions are quite favourable. I don't know much about pensions and I'm getting on a bit so it's something that I should be addressing. Could someone please explain the pro's and cons of both staying put and combining? If you have read this far then thanks!

OP posts:
Llareggub · 14/04/2015 18:59

You need advice from someone qualified. I know quite a bit about the lgpS; enough to know that I am no way qualified to advise!

EllieFredrickson · 14/04/2015 19:03

You'll need to check but don't think you can transfer benefits from other schemes into the LGPS. LGPS is now career average - effectively you earn an amount of pension per year based on your salary which is then index linked. So each year is a bit like a different pot.

SymphonyofShadows · 14/04/2015 19:12

Thanks for the replies. The form asks previous pension rights and asks for details, including personal pensions. It then talks about any option to transfer only being available for 12 months. From what you say Ellie it does sound like I should probably leave the other ones alone though

OP posts:
whooshbangprettycolours · 15/04/2015 16:09

I wouldn't combine as the flexibility you have with the other funds is far greater than the local authority scheme. The 'value' you get isn't more than fair value so I wouldn't do it. The local gov scheme will not give you access to the money until the normal retirement date whereas what you have you can get at from 55 (for now).

prepperpig · 17/04/2015 13:48

In many cases you are much better to transfer into the LGPS but you need to take proper advice. They should have shown you how many years your private pension will buy you in the LGPS. This can then be used to work out whether its worthwhile.

whooshbangprettycolours · 19/04/2015 12:14

In many cases you are much better to transfer into the LGPS but you need to take proper advice.

I'm sorry but that is just not the case. Firstly, the laws on pensions have changed - a lot.
Secondly, to buy into the scheme you pay the equivalent of the employer and employee contribution and this is a high cost with little flexibility that you give up all rights to.

A pension in a money purchase pot can be left to your kids, not just 'half' to a spouse. Why would you give that benefit up?

I think advice face to face with a qualified advisor would be worth every penny.

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