NHS pension disappointment.

[Stillearninglife]

After 33 years in the NHS I have been battling with pensions as they “lost” years and years of my pension due to “clerical errors “.
Now I have a prediction which I intend on taking at 55.

Seemingly one of the best pensions around, reading of other people’s pensions, it is utterly crap.

33 years with a lump sum of less than £80k then monthly payments of less than £800 per month is so low. All those years at B7 diligently paying in thinking I will be ok financially and it’s just dire.

I left the NHS due to conditions and pay some time ago (2 years ago) so nothing is going into the pot, so I’m taking it at 55 next year.

Anyone had similar experience with NHS pension?

If I’m no longer paying into it, growing it then how can it give a greater return if I leave it another 10 years is my question.

Because it should be INVESTED OP and being managed to ensure that it will grow. That's how pensions work! You don't pay in every penny that you eventually get out. You pay the money in and the pension provider invests it in stocks and shares and funds that are managed by (hopefully!) experienced managers who know how to grow your money over time. If you take it out at 55, rather than waiting until your pension age, you'll lose 10 or more years of growth in a pension fund and you will therefore get a lot less. Pension predictions are usually based on you working until your correct pension age. If you take it early as a lump sum you will lose a lot of its value.

If she has special status, normal retirement age is 55 for her 95/08 scheme. No actuarial reductions. Certain professions (firefighters, police, armed forces, certain categories of nurses) acknowledge that you are not likely to be physically capable of doing the job at the usual pension age so allow you to take it earlier with no actuarial reductions.

It doesn't apply to her 2015 pot, but as this should have been restated so the years 2015-2022 are in the 95/08 (actually, has this been done OP? Something you need to check) the difference should be minimal.

SC status applies to members in particular employment groups who were members of the NHS Pension Scheme before 6 March 1995. These employment groups include:

• nurses including student nurses and occupational health nurses
• physiotherapists
• midwives
• health visitors.

Nursery nurses and physiotherapy helpers are not included. SC status was abolished from 6 March 1995. Members who already held the status on or before 6 March 1995 can keep it until retirement if they:

• continue membership in qualifying employment
• do not have a break in membership of 5 years or more.

Members with SC status can continue to keep their SC status in the 2015 Scheme but it only counts towards an earlier retirement age for benefits in the 1995 Section.

Retirement
If you have SC status your normal retirement age is 55. You can retire at age 55 with unreduced benefits if:

• you’re in a SC post on the date of your retirement
• you’ve been a SC member for the last 5 years of pensionable employment.

The 5 years of pensionable employment does not need to be continuous service. Left pensionable employment or opted out of the Scheme If you leave pensionable employment or opt-out of the Scheme before age 55 and do not return, your benefits will become deferred and your normal retirement age will be 60.

So it sounds like part of your pension may not be affected by taking it at 55yo - but any pension not in the 1995 scheme would be?????????? Also did you leave the nhs before 55yo?

What is Special Class (SC) status? · Customer Self-Service

As a comparison I did 24 years, the last 11 on band 8a. I retired at 55 five years ago. Lump sum 70k and I receive £1, 059 monthly pension. The predictions sound right for you.

SCS… no reduction at all at 55.

That's really not how defined benefit pensions work

Op, people aren't understanding how the nhs pension works with special class status and the final salary aspect of the 1995 section , which closed in 2022 ( McLeod ruling extended it from 2015 as a pp said). I did make an assumption that you kept your pension in the 1995 section and didn't move it into 2008 when I posted earlier. Do you have the full 33 years in final salary?

Not for an nhs scs pension.

Tbf, OP did not mention until quite a few posts in that she had this special status, so the initial advice given by many PPs before this clarification was not unreasonable.

My only thought on hearing that was, no wonder this country’s finances are fucked if there are some NHS workers that can take a full pension from age 55 with no reduction in the amount payable.

I think there are a couple of points here:

1. some of the numbers don’t seem quite right. The lump sum seems high compared to the monthly as another poster pointed out. if you were paying £900 in contributions each month were you doing extra voluntary payments? That also doesn’t seem right unless you had some months with very high earnings.

I think for your own peace of mind you need to know whether your projection is actually right and do some more digging. I’d have expected it to be a higher monthly payment based on what the OP has said.

2. notwithstanding possible discrepancies, £800 a month inflation linked guaranteed for life from 55 plus £80k lump sum is actually pretty good and a lot of people on defined schemes just don’t appreciate how much they’d have to save in a private pot to get that.

It would be very unusual to start as a B7, so surely you were a B5 or 6 before that?

@Stillearninglifedo you know if these amounts have been recalculated due to the Macleod Remedy adjustment?

Your 2015 pot should have been restated as 95/08 back to 2022. A lot of the estimates I'm seeing at the minute this hasn't been done.

If you left NHS pension scheme before 55, it’s unlikely that you have SCS. Check out the fact sheet on SCS.

You are misunderstanding the poster. She doesn’t mean making more contributions, she means leaving the pension untouched until you are 67 which is retirement age. That means the NHS pension provider doesn’t have to pay the pension from 55-67 so 12 years less. Hence you get a lot less money if you retire at 55.

This is exactly the type of figures I would have expected to see.

I agree. It’s absolutely ridiculous and needs to stop.

Of course it will be higher because you won’t have been taking £9k worth of benefits every year for 11 years if you retire at 66 instead of 55.

This totally, after over 30 years of service your pension should be more than £800 per month, I don't think this figure is correct. Are you in a union and if so could they look into it for you?

It has stopped. Ages ago. I joined the scheme in 2008 and scs wasnt a thing then for new starters.

The nhs could be paying your pension for the next 40 years, that’s why it’s so low. It’s a lot when you think about it in those terms. Much more than most will get. Plus you’ll be getting state pension when the time comes.

@ClashCityRocker@CamillaMacauley

there are strict conditions for SC status. You must have worked the past 5 years in the SC role to be able to draw pension at 55.
the OP left 2 years ago and is currently 54 as she says she has a year to 55. This means she hasn’t worked her last 5 years in the SC role.

I believe this means she is entitled to the pension but will either have a reduced amount if drawn at 55 as with other pensions. This is because the SC was set up to take into account the toll the SC roles took and therefore the early retirement.
the 33 years is not relevant because she left before 55.

I think you have misunderstood? Sorry if you havent

because you are accessing it 12 years (?) early the pension will be paid to you for much longer. So the monthly payment will be much lower even if you have stopped paying into it.

you're wrong in your understanding

The pension pot will not rise - but the difference int he amount you et even each month will rise the longer you don't take your pension between 55 and 67

This makes a tonne of sense. Thank you for this, this could well be the reason then, the SC status has been lost?

But OP is taking her pension very early. The pension amount is reduced for every year to take it early.

if OP took the pension at 65 or 67 the amount would be much higher