NHS pensions explain to a stupid person!

[curlywurl]

Please can anyone talk to me about 1995 section, 2015 section and my added years contract? I am 40 and still don't understand what I will get and when. The total rewards statement and website is not helping me understand

There's a government website where you can check the level of state pension you're entitled to. I can't remember what it's called - have a google.

Sorry - just realised you're talking about nhs pension. Ignore me 😳

I've not looked at the state one yet still trying to work out the work pension!

this might help you

Thanks I've had a look. It's being in the 2 scheme's that confuses me. I have several years in the 1995 scheme before we had to transfer to the 2015 scheme. Do I treat them like 2 separate pensions? When I retire will I get payments from both? Obviously payments from the 1995 will be low as I only have about 8 years in it.

Also I took out an added years contract when I started in the NHS (under 1995 scheme) to buy just under 8 extra years. Are these years part of my 1995 pension? I am paying just over 5% of pensionable pay for these extra years until age 60. I don't understand what it is giving me and if it is worth it. It just seemed like a good idea when I started my first NHS job.

The best thing is to ring NHS Pensions and get them to explain it to you. 0300 330 1346

It will be worth it and you will be very glad you did.

Will NHS pensions talk me through it? I don't even have any sensible questions I just want someone to explain it very very simply.

Will I be glad of the added years? How much difference will it make? Can I retire earlier because of it? It just seems like such a lot of money to pay every month for the next 20 years

Yes, what a PP said... ring NHS pensions. They are fabulously helpful, as was my Trust's Pensions Dept.

I've just worked out that I'll pay well over £40,000 in extra contributions by the time I'm 60. That's a lot of money to not understand what I'll get from doing it!

Who did you go to in your trust? Was it just payroll and pensions Dept? I contacted them when I changed to this trust and they were very unhelpful. One women even suggested I would just get all my added contributions refunded if I couldn't supply the paperwork on the added years contract from my original trust.
My trust run pre retirement courses but they are only for people less than 5 years from retirement.

You will get an annual pension equivalent to a percentage of your annual salary (averaged over your career) for the rest of your life (and a lumps sum paid to a beneficiary if you die in service). The percentage will depend on the details of the scheme and how many full years you have paid in.

I see for the 1995 scheme you get 1/80th of your final salary for each year you have contributed, and can take it at 60 and you also get a lump sum equivalent to 3x the annual pension

For the 2015 scheme you get 1/54th of your salary that year for each year in the scheme, can take a lump sum for a reduced pension if you wish, and can take the pension at 65.

(The 2015 scheme is generally better for lower earners I think, as it goes on average rather than final salary).

I can only see older articles like this www.telegraph.co.uk/finance/personalfinance/savings/2785624/Pension-top-up-is-a-must-for-NHS-staff.html on buying additional years through salary deductions (which is an option the government stopped ten years ago or more) - the articles are generally positive but it seems it is more likely to favour higher earners but I think you might need personalised advice

I can get a 'total rewards statement' online that shows both schemes for me. It shows for example £3000 yearly pension for the 1995 section and £1000 yearly pension for the 2015 section. Does this mean at the moment I'd get £4000 per year on retirement?
Obviously I know I need more than that to live and need to work many more years!

Thank you for the replies by the way. Everyone I have asked at work either shrugs and says they don't understand or is close to retirement so has a very different pension arrangement and stayed completely in the old 1995 scheme.

I've tried several times over the years to understand but end up giving up!

I feel really stupid. I can understand savings and mortgages but this has always totally confused me.

Yes - you'll get a pension from both schemes.

We’ve just had a series of pension workshops advertised open to anyone. If enough people ask they’d probably do the same, so worth posing the question.

Thank you all. I'll try calling the helpline and contacting pensions in the trust too I was just put off last time I had anything to do with them! That is a good idea about asking for workshops for younger staff. I can't be the only person that needs help!

There may be a pensions module on your Trust e-learning site. There is one on my Trust's EST & it explains things better.
Im not sure about your added years..... that's a bit confusing...but normal pension age in 1995 pension was 60 , however 2015 pension it is 67. Sorry to be the harbinger of doom.
You can be medically retired earlier than 67 & I think I am correct that there are 2 grades of that.
I am 51. I have 23 years in the 1995 pension and coming up to 4 in the 2015 pension. Under the 2015 regulations, I can't retire until age 67. Same as my state pension.
There was an age cut off date in 2015. I can't remember the exact phrasing but basically those who are about 57 now could stay in the 1995 pension but those younger had to transfer over.
There is a 2008 pension too but I don't know much about that one.
The 2015 pension takes the average of your salary over day x years when working out final figures. The 1995 pension was based on your best 3 years salary .

*NHS Trust ESR not EST 🤦‍♀️

Just one more question if anyone knows or can work it out. I took out an added years purchase contract in 2006 to buy 7 extra years by the time I'm 60. So this was taken out whilst under the 1995 scheme. Will this mean I'll have 7 extra years contributions to the 1995 scheme? E.g the 9 years I worked before switching to the compulsory 2015 scheme plus 7 extra years equals 16 years under the 1995 scheme?

Thanks will check out ESR as well. Bet it is more boring than fire training online!

I think you're probably right but not entirely sure but it could be that you only get a %of those 9 years because the calculation was based on you retiring at 60

Another thing to note is : you can apply for similar in the 2015 scheme, but you can only apply to bring your new pension age eg 67 down to the magical age of 65.
There'll be a lot of NHS clinical staff on Zimmer frames methinks.