Leaving the civil service- what do I need to think about?

[plumpie79]

I'm about to leave the CS for a job in the voluntary sector. It's a fair (20%) pay rise, but obviously the excellent benefits package goes to be replaced by a 6% pension and not much else. What additional provisions should I put in place given I am the largest earner and we have 2 pre schoolers (I'm in my mid 30s)? DH is still CS and we both also have life insurance in addition to our death in service provision.

There's no decent sick pay provision- is critical illness cover worth having? Up the life insurance cover?

I will also be making additional pension contributions- I was voluntary sector before and have always had good provision so am well 'on track' with pension.

It's a move where I think I'm probably just going to break even but it's for career purposes so worth it in my view.

Any advice welcome!

DH and I are both civil servants. When we last moved house I ran all the figures for either of us dying, including death in service benefit, spouse’s pension, and child’s pension for DD. Our life insurance is then designed to top the figures up to a manageable level rather than being plucked out of the air.

So if either of us left the CS I’d be looking at the difference between death in service and death after leaving (ie with a preserved pension), and adding further life insurance to account for that difference.

At least investigating critical illness cover sounds like a good idea.

A cheaper alternative to critical illness is a policy which provides a guaranteed income per month for a set period of time, if you die or become unable to work in your chosen career. This is a monthly payment instead of a lump sum.

You can set this to pay out until a key moment in your families life - so when the children will be solvent or when they will be old enough for an individual parent to work more, or when the mortgage will be paid off. Such schemes can be set up to kick in at an appropriate time, bearing in mind how much sick leave, death in service payments

Etc you will get. They can also be set up slightly differently for each person in the couple to reflect the different benefits their different employments deliver.

This is an option to consider and one a financial adviser will probably speak to you about, as it can be significantly cheaper.

It is probably worth a couple of hundred quid to see the financial advisor who will tell you what is available and costs.

I agree with deciding what level of cover you need to bridge gaps in what is provided by work and then getting policies to fill the gap, rather than randomly having a figure. You want enough cover, but you don't want more than needed, because it's obviously expensive and the chances are that you won't need to draw on it.

Ah that's interesting @wombat I'll look into it. We don't need cover for DH really as he has a great sickness policy through work and we could just about survive without his salary. I'm the problem!

I'll do the maths on the life insurance as well.