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!!!

35K a year plus 200k lump sum would require a £1 million pension pot for a DC pension.

9000 a year is a pension pot of 225k in a DC pension

i am a higher rate tax payer and have been paying 10% into my private pension for 21 years and it’s less than 225K

Just to provide some context here.

I phoned a HelpLine but they insisted they couldn't help as it wasn't a pension, it was a benefit scheme. So I gave up.

Thank you ❤️ it made me smile too 😄

EDIT - ignore

Well done OP, that's great news

But the media tell us that all public sector workers have ‘gold plated pensions’
In my experience gold plated is usually substandard metal….much the same as public sector pensions.

Then ask your employer, typically HR or payroll what servuces are available to employees who want to understand and manager their pension better.

All employers have to make that available to employees in Ireland. I'm happy to be corrected if that's not yhe case in the UK, but I would be very surprised if it wasn't.

I'm sorry @Gall10 how much more benefit do you think the taxpayer should subsidise you at the expense of their own private sector retirement planning?

Yes. Dividing by 25 gives a 4% draw down rate per year. Your investments still keep growing and therefore last your whole life. Not that that's actually relevant to the OP but it's a good rule of thumb when working out if you have enough invested to retire.

They would be referring to the fact that it was a Defined Benefit scheme. You won't generally get advice on these because they are a standard formula.
Do you understand now the type of pensions you have? If not it might be worth doing some reading. Somewhere like money saving expert where there is a dedicated pensions board with people that know what they are taking about. There is loads of information so it would be a good starting point to help you understand.

Don't be such a child.

Public sector workers are often not paid competitively for the work they do. If they get a decent pension as part of their package that's not you "subsidising" them. You'd be screwed without public sector workers.

You are right, there are cases where public sector workers are underpaid when compared to private sector equivalents. And I don't for a second suggest that they don't deserve a competitive pension scheme. I am challenging @Gall10 's comments that the pensions are 'substandard' when that is clearly not the case. Public sector schemes continue to offer benefits for in excess of what is available in the private sector, which, I suspect, is a magnet stopping staff jumping to the seemingly superior remuneration packages in the private sector.

Yes, we would all be screwed without the public sector. But that emotive stuff about NHS heroes and fireman in burning buildings beyond 50 or whatever doesn't mean we throw out blank cheques with gay abandon, when those cheques are essentially signed by predominantly private sector working taxpayers with far inferior workplace schemes.

30-40 years ago it was accepted that public sector workers had security, better T&C, better holidays and the golden pension after only 35 years of service but lower pay than the private sector. The private sector offered worse T&C, less holidays, much less job security, no golden pension but higher pay and usually faster progression for those willing to put in the hours.

This simply isn’t true any more and hasn’t been for a couple of decades at least. Most private sector workers have seen near stagnant pay and swingeing job losses since the financial crisis. Others saw that same collapse in the 90s. The BMA and other public sector lobbyists always cherry pick the sectors (usually IT and the niche ends of finance) which did well but even these have not progressed much over the past decade or so because pay rises and promotions don’t happen unless the business makes enough money.

I’m often surprised when working with the public sector just at the lack of awareness amongst staff that their benefits are very much public sector benefits, not shared by the vast majority of private sector workers.

Thats not right. I worked for 14 years in Civil Service and my pension is about £24k lump sum and around £450 a month!

Dome questions.
Were you full time? To be blunt, was it a reasonable salary? What was your retirement age, did you work to the standard retirement age or retire early?

Plus, taking a lump sum will have reduced the pension you receive. And that £450 is likely to be indexing at inflation and probably provides some spouses benefit.

That £450 is actually providing a lot more than just £450.

@Suusue further more, a working life could be 18-65, i.e. 47 years. What makes you think you should be set up for life for 14 years of effort? If you started at 18 you'd be finished saving into a retirement scheme at 32 and be all set for a prosperous retirement? To say that provision alone should be sufficient is a bit ambitious. You're about halfway there at best!

I'm having the same issue with my pension. It might be clear to you as someone who 'gets' pensions, but it isn't clear to me - for example, my pension says how much I will get per year, but it isn't clear if that is 'guaranteed' or 'predicted' based on what I have already paid/what I will continue paying (and I can;t see that info from hers either) - so my advice is see an advisor who can answer her specific questions.

I’m often surprised when working with the public sector just at the lack of awareness amongst staff that their benefits are very much public sector benefits, not shared by the vast majority of private sector workers.

I'm public sector and I agree with this, especially in relation to pensions. I moved from private to public sector and the excellent pension was a major factor in my decision. I think a lot of people have no idea exactly how good it is and what you'd need to have in a DC scheme to generate this level of risk-free, index-linked income. (See for example OP not being sure whether her £9k is an annual income or a pot- sorry to use you as an example, op.)

A financial advisor won't be of any use for DB pension. Many won't even discuss it as there are strict regulations around these type of pensions as to what can be done with them.
If you have a pension with civil service, LGPS, NHS etc then the amount you see on your statement is the yearly pension that will be paid to you when you retire. It really is that simple.

It should be possible, with some basic information about how both CS schemes involved accrue service, to get a basic figure for pension.

However the 'dynamisation' process by which it's adjusted for inflation might be more difficult to replicate.

Have you read these scheme guides which explain how the pensions that you have worked/work?

https://www.civilservicepensionscheme.org.uk/memberhub/knowledge-centre/pension-scheme/nuvos-scheme-guide/

https://www.civilservicepensionscheme.org.uk/memberhub/knowledge-centre/pension-scheme/alpha-scheme-guide/

Please I would advise you to ring the pension service and enquire again. Looks like you must have misconstrued the figures. I believe the figure you quoted (9k) is the yearly figure you will get not the overall size of the pot. As ever government job, local authority, NHS, their pensions are what you call Derect Benefits pensions (DB) not direct contributions (DC) as it is in the private sector. With DB pensions, there is no amount for the pot. As the money never runs out as long as you live. With DC, there is an amount for the size of the pot. I worked in government for 5 years and my pension forecast is 4k a year once I retire. That was an administrative role as well. So I believe the 9k you quoted is your yearly pension

First she said she went on HMRC site. Which while no necessarily logical at least seemed at attempt to get an answer. But then the random calculation came completely out of nowhere and made no sense whatsoever! Surely common sense tells you that you can’t just pluck numbers out of nowhere and come up with your pension figure?

it’s very easy to contact the alpha pension scheme. I didn’t myself when I joined CS so I could, y’know, understand how my pension worked…

I misread the title as ‘my penis is worth NOTHING’ … glad your penis I mean pension is ok after all op 🙂