My pension is worth NOTHING

[RosieBright]

I had a job for 13 years in Government and kept thinking it was a great pension as folk kept telling me. I looked at my pension paperwork when the annual statement came through and I have £9000.
I thought that was A YEAR!!! But no, it's worth about £30 a month 😱
How can I boost this? I need anoth £100K to even have half a decent pension

Help!!!

Would it hurt them to put pa after the figures? My pension statement puts pa so I know it’s per annum. I think I’d have freaked too if I saw those figures like that.

What nonsense. The Alpha scheme pays out 1/43.1 of OP's actual salary (not final salary) for each year she worked there, adjusted for inflation.

It is a very complex scheme to get your head around as the pension added changes every year, so you cannot just look at current salary, but relatively speaking it is still a good pension.

You need to see a financial advisor. This made me look at my pension statement and it is fully confusing what it actually means.

It's good that this is worked out, but there's a bigger issue here...

The issue is that you actually thought you had a pension of £30 a month and thought it was legitimate, which would suggest you hadn't been watching and monitoring your pension.

Too many people just stick whatever into a pension pot, check it 30 years later, then are shocked at what they find. It shouldn't be like that. A pension is something that should be actively watched so you have an idea of what it will be worth in X years' time.

No she really dosen't need a financial advisor for a DB civil service pension. She can see exactly how much she will receive each year from the statement she posted earlier. A financial adviser won't be able to tell anything that the statement dosen't.
Again, why give 'advice' on a thread when you don't understand the issue?

Perhaps 9000 is your annual pension? Maybe you need to call them

OP got the answer hours ago. No need to call anyone. She has the statement in black and white as posted earlier in the thread

Mine is less!

It was very clear that this is per annum from the documents that op posted. There is also an assumption that people have a basic understanding of how their pension works.

My mum reckons my dad was in a non-contributory final salary pension scheme, imagine that now! Her mouth falls open in shock when I tell her how much (or little, rather) my public sector pension is going to be. She can't fathom me working all those years and putting my own money in as well as my employer and being projected to come out with such a measly amount. Even DH whose salary has always been way higher than mine will not be on megabucks in retirement even with the "fabulous" civil service pension scheme.

So you have 2 different pensions and both are worth around £4500pa.

One organisation put in 23%!
That's around 4 x what many private company pensions invest.

Yes, it is hard to imagine the type of pensions that were common many years ago. Now, the majority of employers pay the bare minimum auto enrolment type of pensions.

Wages are generally lower in the public sector though. The bands have a top tier and nothing will get you more than that top tier in any band. There are no bonus payments like many in the private sector get every year. The pension is just deffered wages really. It is swings and roundabouts really.

1. why is capita taking everything on and why isn't there more outcry about this.

2)If I had 100 a month to add to my.lgp should I do that or put it into my sipp ?

Thank you @Itsmyyear You sound like you have a great pension, you flipping well enjoy it, and spend it on nice things!

I didn't have a job for years just cleaning etc. Me and my littlies just made the best of it. I got a degree and started working. Couldn't save before that let alone into a pension pot! Ladies be warned if you aren't working!

You have misunderstood your pension.

Forget about what you pay per month - think of whatever you pay as a monthly subscription fee to access the pension scheme and not an actual sum of cash you are putting in a savings pot.

Say you earn £49000 per annum in your local government job and your pension scheme is based on 1/49

Year 1 of being in the scheme you have therefore now been allocated £1000 a year (1/49 of £49000) in your pension forever. So even if you only work for 1 year in local government you will always get that £1000 per year.

Year 2 you earn the same money and subscribe to the same scheme so they add another £1000 per year to what you will now get per year forever even if you now leave/retire after 2 years.

Year 3 the same happens and now your annual pension forever if you leave/retire now is £3000

and so on and so on

So by the time you have done e.g. 13 years in a local government pension scheme on £49000 a year (assuming your salary never changes) your annual pension every year if you retire after 13 years would be £13,000 (£1000x13 years)

What you pay from your monthly salary towards that £1k a year (e.g £250ish per month = 6.4% of your monthly salary or whatever percentage your employer sets) is essentially a subscription fee to access a better pension for every year you stay in the scheme.

The longer you work for local government the better your pension is as every year worked adds a bit extra every year to the annual amount they will pay you in retirement.

You can get a refund if you only work for local government for a couple of years and your monthly 'subscription fee' in that time works out less than what you will get back as an annual pension later.

No I didn't I'm afraid

I took the 9000, divided by 25 (years) then again by 12 (months) =£30

Works out more, rather.

Government do defined benefit pension so I don’t think you get a total value. My statement shows annual pay out.

i think you’re good OP. 9k pa as it stands.

I think it's quite important you get yourself a bit more informed about pensions

A 13 year pension isn’t the same as a 30 or 40 year pension, obviously. It’s intended to be a part pension, just for that period of time, and made up with pension from other employment.

Irrelevant though… the point is not being able to get your old statements isn’t because the site isn’t working. Even if it’s working fully, you won’t be able to get old statements, that’s literally all I was pointing out for OP/anyone with a Civil Sevice Pension. Christ 🙄

Where did the 25 years come from? Where did any of this calculation come from? 🤣

Even if it was a DC scheme, you’d buy an annuity with your £9k pot and that then gives you a payment, you wouldn’t be dividing it by arbitrary numbers.