Has anyone transferred INTO a final salary pension scheme?

[WhatDidISayAlan]

I’m 49 and have been working for a government agency for two years - I just squeezed into their final salary pension scheme. I am planning on staying there until I retire.

I have two old defined benefit schemes ( 2 and 6 year length of service) and one defined contribution scheme pension pot of around £35000. Our pension handbook says that we can put into our pensions to (I think) buy additional length of service, but doesn’t give more detail. Has anyone ever done this? I’ve found loads of info online of not coming out of a final salary scheme, but not putting into. I’d leave my old defined benefit schemes alone but was thinking of putting my defined contribution one into my current scheme.

A lot of schemes will only allow a transfer in within the first 12 months of pensionable service. You may want to check that first before starting to think about what a transfer would purchase

Nobody here can give you a better answer than asking the pension department! Just ask 😀

You can't do that. So the option is you can by AVCs but that is a separate pot to the DB one.

DB to DB transfers are sometimes allowed (if the new scheme is happy to accept them - not a given, you’d have to ask), but DC to DB is very unlikely.

Dc to db is very common. I work on them every day.

It's possible if the rules of the scheme allow it (and sounds like they do) but you need to find out more details. So a statement from the DC scheme with current balance then a quote from DB scheme stating what added years you can buy.

I’d not recommend it unless the quote they give you is off the scale good value (Judges MoJ scheme for example).

Mainly the flexibility of a DC with worth more than an actuarial fair value transfer.

@PrincessButtercupp

You can't do that. So the option is you can by AVCs but that is a separate pot to the DB one.

This is bollocks, if course you can.

Love the shite people offer up as fact @PrincessButtercupp

@milian

DB to DB transfers are sometimes allowed (if the new scheme is happy to accept them - not a given, you’d have to ask), but DC to DB is very unlikely.

And yet lots of them allow it

Incredibly expensive, OP.
17 years in another scheme will buy you one year in final salary (or an equally ridiculous exchange rate).
I doubt you'll think it's worthwhile.

I looked into transferring a private pension into a final salary scheme. What wasn't mentioned by the pension person at my employer was that if I had transferred my private pension over, and then died before retirement (which plenty of people do), my full private pension would have been lost. My children would have got nothing. Whereas if I die before retirement age now, the children will get the money that's in the private pension scheme. But the money paid into the final salary scheme is lost. That was my understanding of it anyway - the pension person refused to advise. I was left with the feeling that the final salary scheme wasn't such a good deal. It's probably different if you're married, though. Read the small print.

This is bollocks, if course you can.

Love the shite people offer up as fact @PrincessButtercupp**

I love the answers on the legal board that start "I would imagine that ..."

(Sorry OP, I don't know the answer, and I'm not going to make one up!)

@YeOldeTrout

Incredibly expensive, OP. 17 years in another scheme will buy you one year in final salary (or an equally ridiculous exchange rate). I doubt you'll think it's worthwhile.

Most government schemes these days are care schemes so you purchase annual pension not years.

Thanks for all the feedback. This is actually the text from our staff handbook so guess it would be treated as AVC.

"Capital Purchase
One-off capital payments may also be made. Under this arrangement, you would make a one-off contribution and receive an immediate credit of pensionable service in the Scheme to reflect your purchase.
Please note that the maximum AVC you may pay in any one year is 15% of taxable earnings less your normal Scheme contributions, detailed above.
For further details of AVC options contact the [EMPLOYER] Pension Scheme Administrator".

Oh, pensions are such a minefield. I don't have kids, and have a boyfriend (who has children) who I don't live with, although I do have nieces and godchildren who I've left my estate to in my will. Looks like it's better to leave it all where it is.

I have been putting money away to treat myself for my 50th, but I'm increasingly thinking that it would be best spent speaking to a pensions advisor.

A capital payment is not the same as a transfer in. Which scheme are you in?

Again, why are you not asking your employer, who will deal with these questions all the time - with the actual facts relevant to that scheme.

It’s sounds like the LGPS. As you were told above, you usually have only 12 months in which to transfer in and you are past that. However, individual counties may allow it - so ASK THEM.

You can also purchase more pension with a lump sum (APCs). But that isn’t a transfer in. You cannot just access your DC money and pay it in as a lump sum, because you can’t withdraw it, only transfer it.

Am I right? Or am I a well meaning person on the internet talking out of their arse? You don’t know.

Talk to the experts!

www.lgpsmember.org/contactfund.php

@secondratefrog Most DB schemes do have some death benefits and/or at least a reduced pension for financial dependants.

[quote ForensicAccountant]@secondratefrog Most DB schemes do have some death benefits and/or at least a reduced pension for financial dependants.[/quote]
They do, but assuming her children are over 23 unless there were extenuating circumstances there wouldn't be much due from a db scheme, likely just a refund of any employee contributions and the bulk of the benefit is 'lost'. It's a common pitfall of DB pensions and why many people chose to transfer away from DB schemes.

OP, the best thing you can do is ask your scheme if it's permitted, provide them with the fund value of your dc scheme and ask them what it would buy you.

If you're unfamiliar with pensions I would strongly suggest you see an independent financial adviser to see what's best for you. They will do an analysis which takes into account difference in death benefits, your expected income from your other schemes and your target income/expenses and help you decide whether it's the right move for you or if the flexibility of the DC pot is more valuable to you compared to the additional security of putting it in a db scheme

Thanks all for feedback. I will be speaking to my current provider about options, just wanted to have a bit of knowledge rather than going in blind.

My current pensions are: current Civil Service final salary pension with two years service, an old LGPS with 6 years, a BBC pension with three years and transferrable value of £38k, and a pot from my previous employer with £35k in it. I'm not married, have no kids, it's all a bit messy, and I will be speaking to a pensions advisor in the next 12 months.

Ideally would like to streamline things a little bit between final salary schemes and pension pots, so that I know roughly what is available when, if there is a shortfall, how to access, and what would be available should I die (my family don't do longevity on the whole).

If that's to happen to me, I'd rather some be available to help children who have brought me a lot of joy to use to get on the property ladder, than it disappear into some hole.

I transferred a defined contribution scheme into a defined benefit scheme in my last civil service post. I'd had a few years in a charity and when I moved back into the civil service, I was able to transfer the charity (DC) pension into the civil service one. It's not exactly a final salary scheme (although I do have preserved benefits in the old PCSPS final salary scheme) it's a career average. But it's still a defined benefit and - I'm told - these are generally going to be better for the majority of people.

It may be something you have to do within a certain period, so just talk to the pension administration service to find out the process.