Teachers Pension: Transitional Protection Changes

[Searchingforananswer2023]

Hello everyone, I have received notification that I am going to be impacted by the changes and there are some time critical decision to make. In all honesty I have not got a clue. Anyone else in the same boat? I am late 30s, so have a good while to go. My current plan is with career average drop to 3 days a week from 50, go early at 57, work PT 3 days a week at something else, cash in LISA at 60 and get the state pension at 68. Mortgage will be paid and financially I'll be okay, not rich but I'll be able to pay bills, buy food and treat myself occasionally. I won't have huge costs for petrol, clothes etc as life changes as we get older.

@Searchingforananswer2023 I assume this is the McCloud remedy.

Firstly are you 100% sure the communication is not a scam as understand that there are some around this situation.

I suggest you talk to your HR or TU rep before responding.
https://www.teacherspensions.co.uk/news/public-news/2022/03/prospective-remedy-consultation-response.aspx

Not a scam. Have had the email and when I log into My Pension Online I've got the notification.

Any other advice?

I got an email yesterday as well-I wasn’t really sure what the changes were??

There is a retired teacher who posts really helpful videos on YouTube about the TPS and addresses the McCloud judgment. Search for Dave Fountain and you’ll find his channel.

@Searchingforananswer2023 glad it’s not a scam.

Can you briefly outline what decision they require?

I watched the David Fountain video and still don’t understand.

Someone needs to small words it for me like I was a struggling year seven.

How much does it cost to buy extra pension? It’s just all way over my head and “speak to an IFA” isn’t especially helpful when I have no idea what I’m speaking about.

Does the union have any pension/financial advisors you can contact?
I don't know what you've been sent, but a colleague has been advised to stop pension Co tributions for a month, then restart them to enhance her pension at retirement.
If the information you have been sent isn't clear enough, I think you need an expert to talk things through with.

@Searchingforananswer2023 I’ve taken the following from the website https://www.teacherspensions.co.uk/members/scheme-changes/transitional-protection/rollback-october-2023.aspx

I have added 1. And 2. as there appears to be two decisions. One about service before 31/03/2022 and one relating to service after 01/04/2022.

1. If you took out Faster Accrual, Buy Out or career average scheme Additional Pension, or worked any overtime or excess service in the career average scheme during the remedy period, you’ll be required to make a decision as these are unavailable in the final salary scheme - we’ll be in touch with you separately about this.
2. As your service during the remedy period has been rolled back, this means you entered the career average scheme for the first time on 1 April 2022. As you’re a new entrant from that date, there are some new opportunities available to you for you to increase your benefits and those of your family.

• Transfer service from another pension scheme into the Teachers’ Pension Scheme within 12 months.
• Increase your accrual rate each year through a Faster Accrual election.
• Buy-out the actuarial reduction that’ll be made to your career average benefits if you decide to retire before reaching your Normal Pension Age.
• Purchase Additional Pension benefits to be paid when you retire.

Some of these opportunities have time limits and it’s important you take the time to understand your options. Please read our factsheet for active and deferred members to help you understand more.

Is it 1. 2. or both you need help with?

If it’s similar to the Civil Service pensions, check the provision for a spouse / partner if you predecease them, in one they receive a half pension and in the other it reduces to one third. If you don’t have a partner or children, check whether you can claim back a percentage of your contributions for widows and children when you retire.

@Searchingforananswer2023 did you make a decision on this? I have the same and have read the info but still no clue!

I thought you didnt need to make any decisions now. You decide when u retire. The only time Limited thing is whether you want to do the 'leave 3 years early before your retirement age thing'. I forget the name. But I've chosen not to do this because actually I spoke to Wesleyan and they explained that doing that thing was no different to waiting until say 65 and THEN choosing to go 3 years early. Because either way the financial penalty is the same. If you choose now to say retire at 65 you will have to pay an additional amount through your working life. If you wait and choose to retire when you get yo 65, then there will be actuarial reduction on ur pension but the sums work out the same. The benefit of waiting until eg 65 is that u never know if you will end up taking ill health early retirement anyway. Does this make sense?????
I think it is only that 3 year taking the pension eatlyvthing that u have to decide in first 6 months but like I said, wesleyan said, I could just wait until 65vand see how I feel then. Probably I will try to build up private pension or isa to use in those 3 years.

@hastalavista the decision I have to make is about a transitional period and whether I want to get paid overtime contributions into my bank account now or defer payment until retirement.

In case useful, DH made the decision (to get paid overtime now), filled in a form, and the money came through within a few days. All done and dusted.

@BookWorm45 Thank you. Can I ask how you decided? I have no idea how much it would be or why one would wait until they retire to receive it rather than have it now.

Decision was easier as it wasn't very much money (the TPS gave a figure) and just felt easy to take it now rather than wait.
However what I think was the most helpful is here to talk through options: https://dfountain.co.uk/overtime-refund-but-now-or-later/
Dave Fountain's website is full of really helpful things - he is a retired teacher.

I wish l understood this.

I got ill health retirement in 2021, but was affected by the Mcloud judgement.

It just says my benefits will be recalculated, but not how😣

You should eventually get a pack with two figures one under the old scheme and one under the new. You then decide which is more beneficial to you.

Does it mean more money🙏

@ArseInTheCoOpWindow everyone is different so no one can say. The one thing I will say is look at the whole package and not just the headline figures.

I think I will end up opting for a slightly lower pension by £100 per year but a slightly bigger lump sum. However, I should also get a one off payment in lieu of a tax rebate for 2020/21 tax year. So overall I will be happy but I understand the trade offs.