More years drawing a pension than contributing?
Discussion
ED209 said:
My pension has been absolutely destroyed by the government.
I will ................ loose hundreds of thousands of pounds on the pension
I don't have Sidicks' knowledge of pensions but here's some very rough numbers:I will ................ loose hundreds of thousands of pounds on the pension
Picking a random figure of a 30% loss of what you 'had' (I suspect it's less), £200k loss would mean a remaining figure of £467k pension value. Dividing this by 30 years gives £15.5k to receive per year of service.
If you have a salary of £30k then 15% contributions would be £4.5k
This means that the taxpayer is still contributing £11k per year on your behalf even after what you deem to be destruction of your pension.
You're not exactly hard done by & it's still not a sustainable model.
btw- the word is 'lose'.
Rovinghawk said:
ED209 said:
My pension has been absolutely destroyed by the government.
I will ................ loose hundreds of thousands of pounds on the pension
I don't have Sidicks' knowledge of pensions but here's some very rough numbers:I will ................ loose hundreds of thousands of pounds on the pension
Picking a random figure of a 30% loss of what you 'had' (I suspect it's less), £200k loss would mean a remaining figure of £467k pension value. Dividing this by 30 years gives £15.5k to receive per year of service.
If you have a salary of £30k then 15% contributions would be £4.5k
This means that the taxpayer is still contributing £11k per year on your behalf even after what you deem to be destruction of your pension.
You're not exactly hard done by & it's still not a sustainable model.
btw- the word is 'lose'.
Rovinghawk said:
ED209 said:
btw - your figures appear to be simply pulled from thin air.
The £200k was based on your 'hundreds of thousands' statement. The rest were described as picked at random- if you'd care to provide more accurate figures I'd be happy to rework the sums.ED209 said:
Rovinghawk said:
ED209 said:
btw - your figures appear to be simply pulled from thin air.
The £200k was based on your 'hundreds of thousands' statement. The rest were described as picked at random- if you'd care to provide more accurate figures I'd be happy to rework the sums.ED209 said:
Nah Im not really interested in engaging with you due to the condescending nature of your posts.
Apart from correcting some of your spelling I thought it was pretty mathematical.I'll stand by the general gist of my figures unless something better comes along. You seem to want to use emotive phrases rather than facts and figures- I'll infer that the facts/figures don't suit you.
I don't have a pension pot as such as it was meant to be a final salary pension.
These are approximate figures as i remember them from the last forecast i got about a year ago as i remember them, I haven't got them to hand at the moment. Its also not very helpful that the government have withdrawn the calculator from its website.
On my current salary i should have retired after 30 years service at 49 years and 50 weeks old with an accrual of 40/60ths final salary pension giving either a pension of £28k a year or 21k with a lump sum of £155k approx (very generous I know but thats what i signed up for and the main reason I chose to spend my early twenties working Saturday nights grappling with drunks instead of being one go those drunks)
I was kicked out of that pension scheme on 1st April 2015 so now if i work 30 years and retire my pension accrual will only be approx 23.5/60ths to be drawn at that time. so a pension of approx £16500 a year with no lump sum. Of course in the 12 years until that time I must still pay into the new 2015 scheme at an accrual rate of 1/55.3 of salary per year. This in theory can be claimed when i hit 55 but because I have gone off before then it will be actuarily reduced from state pension age reducing its value massively. This new pension is average salary not final so again i loose out there.
So basically I have three options.
1) Retire just before my 50th birthday like i should have - this will not be financially viable as £16500 a year is simply not enough when you have a mortgage and bills to pay. Then i can draw my 2015 pension from 55 but this will be worth very little due to the actuarial reduction.
2) Retire at 55 years old, after just over 5 years extra service and draw both my 1987 and 2015 pensions. The 2015 pension will then only be actuarily reduced from 60. however the commutation factor on my 1987 scheme will also be reduced because I am retiring older. This seems unfair as in effect the government are forcing me to stay on longer then taking money off me for doing so.
I seem to remember the figures for retiring at 55 combining the 2 pensions were a lump sum of around £110k and a pension of £19k per year. So you can see thats still a lot worse than the pension i signed up for despite paying in for another 5 years ( current contributions £5700 a year).
As you can see Im putting in an extra £28k approx into my pension and not claiming 28k a year for those 5 extra years i am working so thats £140k lost there plus the £28k of extra contributions plus the fact i will be drawing a much worse pension at the end of it. Should i live a reasonably long life the losses will easily add up to over £200k
3) retire at 60 after 40 years and 2 weeks service, I remember that the figure without any lump sum was around £30k ish a year pension, this is nice but that'd for a whole 10 years extra worked.
So 10 years extra contributions £57k at todays rates, 10 years not claiming the pension i signed up for £280k so over 300k down there all for the pleasure of 10 years more stress, violence and shift work.
I make no apologies if my grammar is crap, its not an english exam. I am sure you can see that i have been shafted quite a bit.
These are approximate figures as i remember them from the last forecast i got about a year ago as i remember them, I haven't got them to hand at the moment. Its also not very helpful that the government have withdrawn the calculator from its website.
On my current salary i should have retired after 30 years service at 49 years and 50 weeks old with an accrual of 40/60ths final salary pension giving either a pension of £28k a year or 21k with a lump sum of £155k approx (very generous I know but thats what i signed up for and the main reason I chose to spend my early twenties working Saturday nights grappling with drunks instead of being one go those drunks)
I was kicked out of that pension scheme on 1st April 2015 so now if i work 30 years and retire my pension accrual will only be approx 23.5/60ths to be drawn at that time. so a pension of approx £16500 a year with no lump sum. Of course in the 12 years until that time I must still pay into the new 2015 scheme at an accrual rate of 1/55.3 of salary per year. This in theory can be claimed when i hit 55 but because I have gone off before then it will be actuarily reduced from state pension age reducing its value massively. This new pension is average salary not final so again i loose out there.
So basically I have three options.
1) Retire just before my 50th birthday like i should have - this will not be financially viable as £16500 a year is simply not enough when you have a mortgage and bills to pay. Then i can draw my 2015 pension from 55 but this will be worth very little due to the actuarial reduction.
2) Retire at 55 years old, after just over 5 years extra service and draw both my 1987 and 2015 pensions. The 2015 pension will then only be actuarily reduced from 60. however the commutation factor on my 1987 scheme will also be reduced because I am retiring older. This seems unfair as in effect the government are forcing me to stay on longer then taking money off me for doing so.
I seem to remember the figures for retiring at 55 combining the 2 pensions were a lump sum of around £110k and a pension of £19k per year. So you can see thats still a lot worse than the pension i signed up for despite paying in for another 5 years ( current contributions £5700 a year).
As you can see Im putting in an extra £28k approx into my pension and not claiming 28k a year for those 5 extra years i am working so thats £140k lost there plus the £28k of extra contributions plus the fact i will be drawing a much worse pension at the end of it. Should i live a reasonably long life the losses will easily add up to over £200k
3) retire at 60 after 40 years and 2 weeks service, I remember that the figure without any lump sum was around £30k ish a year pension, this is nice but that'd for a whole 10 years extra worked.
So 10 years extra contributions £57k at todays rates, 10 years not claiming the pension i signed up for £280k so over 300k down there all for the pleasure of 10 years more stress, violence and shift work.
I make no apologies if my grammar is crap, its not an english exam. I am sure you can see that i have been shafted quite a bit.
Edited by ED209 on Thursday 25th August 21:32
ED209 said:
These are approximate figures as i remember them from the last forecast i got about a year ago as i remember them, I haven't got them to hand at the moment. Its also not very helpful that the government have withdrawn the calculator from its website.
On my current salary i should have retired after 30 years service at 49 years and 50 weeks old with an accrual of 40/60ths final salary pension giving either a pension of £28k a year or 21k with a lump sum of £155k approx (very generous I know but thats what i signed up for and the main reason I chose to spend my early twenties working Saturday nights grappling with drunks instead of being one go those drunks)
I was kicked out of that pension scheme on 1st April 2015 so now if i work 30 years and retire my pension accrual will only be approx 23.5/60ths to be drawn at that time. so a pension of approx £16500 a year with no lump sum. Of course in the 12 years until that time I must still pay into the new 2015 scheme at an accrual rate of 1/55.3 of salary per year. This in theory can be claimed when i hit 55 but because I have gone off before then it will be actuarily reduced from state pension age reducing its value massively. This new pension is average salary not final so again i loose out there.
No, it is reduced from normal pension age (60) NOT state pension age.On my current salary i should have retired after 30 years service at 49 years and 50 weeks old with an accrual of 40/60ths final salary pension giving either a pension of £28k a year or 21k with a lump sum of £155k approx (very generous I know but thats what i signed up for and the main reason I chose to spend my early twenties working Saturday nights grappling with drunks instead of being one go those drunks)
I was kicked out of that pension scheme on 1st April 2015 so now if i work 30 years and retire my pension accrual will only be approx 23.5/60ths to be drawn at that time. so a pension of approx £16500 a year with no lump sum. Of course in the 12 years until that time I must still pay into the new 2015 scheme at an accrual rate of 1/55.3 of salary per year. This in theory can be claimed when i hit 55 but because I have gone off before then it will be actuarily reduced from state pension age reducing its value massively. This new pension is average salary not final so again i loose out there.
No, it is not average salary, it is revalued average salary at a revaluation rate of 1.25% above inflation.
ED209 said:
So basically I have three options.
1) Retire just before my 50th birthday like i should have - this will not be financially viable as £16500 a year is simply not enough when you have a mortgage and bills to pay. Then i can draw my 2015 pension from 55 but this will be worth very little due to the actuarial reduction.
2) Retire at 55 years old, after just over 5 years extra service and draw both my 1987 and 2015 pensions. The 2015 pension will then only be actuarily reduced from 60. however the commutation factor on my 1987 scheme will also be reduced because I am retiring older. This seems unfair as in effect the government are forcing me to stay on longer then taking money off me for doing so.
I seem to remember the figures for retiring at 55 combining the 2 pensions were a lump sum of around £110k and a pension of £19k per year. So you can see thats still a lot worse than the pension i signed up for despite paying in for another 5 years ( current contributions £5700 a year).
As you can see Im putting in an extra £28k approx into my pension and not claiming 28k a year for those 5 extra years i am working so thats £140k lost there plus the £28k of extra contributions plus the fact i will be drawing a much worse pension at the end of it. Should i live a reasonably long life the losses will easily add up to over £200k
3) retire at 60 after 40 years and 2 weeks service, I remember that the figure without any lump sum was around £30k ish a year pension, this is nice but that'd for a whole 10 years extra worked.
So 10 years extra contributions £57k at todays rates, 10 years not claiming the pension i signed up for £280k so over 300k down there all for the pleasure of 10 years more stress, violence and shift work.
I make no apologies if my grammar is crap, its not an english exam. I am sure you can see that i have been shafted quite a bit.
1987 Transition Members (i.e. members with accrued benefits under the 1987 Scheme) will be able to access those benefits when they are eligible to retire under the 1987 Scheme on a maximum, unreduced pension (i.e. with 30 years’ pensionable service; age 50 with 25 or more years’ pensionable service; or at the member’s voluntary retirement age), subject to abatement rules for that scheme (the temporary reduction in pension payments which may be imposed by a Police Pension Authority if a member is re-engaged after retirement. This does not apply to the 2015 Scheme). For a Transition Member with continuity of service, pensionable service for the purpose of calculating entitlement to benefits under the 1987 Scheme will include the total period of continuous pensionable service under both the 1987 Scheme and the 2015 Scheme1) Retire just before my 50th birthday like i should have - this will not be financially viable as £16500 a year is simply not enough when you have a mortgage and bills to pay. Then i can draw my 2015 pension from 55 but this will be worth very little due to the actuarial reduction.
2) Retire at 55 years old, after just over 5 years extra service and draw both my 1987 and 2015 pensions. The 2015 pension will then only be actuarily reduced from 60. however the commutation factor on my 1987 scheme will also be reduced because I am retiring older. This seems unfair as in effect the government are forcing me to stay on longer then taking money off me for doing so.
I seem to remember the figures for retiring at 55 combining the 2 pensions were a lump sum of around £110k and a pension of £19k per year. So you can see thats still a lot worse than the pension i signed up for despite paying in for another 5 years ( current contributions £5700 a year).
As you can see Im putting in an extra £28k approx into my pension and not claiming 28k a year for those 5 extra years i am working so thats £140k lost there plus the £28k of extra contributions plus the fact i will be drawing a much worse pension at the end of it. Should i live a reasonably long life the losses will easily add up to over £200k
3) retire at 60 after 40 years and 2 weeks service, I remember that the figure without any lump sum was around £30k ish a year pension, this is nice but that'd for a whole 10 years extra worked.
So 10 years extra contributions £57k at todays rates, 10 years not claiming the pension i signed up for £280k so over 300k down there all for the pleasure of 10 years more stress, violence and shift work.
I make no apologies if my grammar is crap, its not an english exam. I am sure you can see that i have been shafted quite a bit.
???
sidicks said:
1987 Transition Members (i.e. members with accrued benefits under the 1987 Scheme) will be able to access those benefits when they are eligible to retire under the 1987 Scheme on a maximum, unreduced pension (i.e. with 30 years’ pensionable service; age 50 with 25 or more years’ pensionable service; or at the member’s voluntary retirement age), subject to abatement rules for that scheme (the temporary reduction in pension payments which may be imposed by a Police Pension Authority if a member is re-engaged after retirement. This does not apply to the 2015 Scheme). For a Transition Member with continuity of service, pensionable service for the purpose of calculating entitlement to benefits under the 1987 Scheme will include the total period of continuous pensionable service under both the 1987 Scheme and the 2015 Scheme
???
You are wrong about the revaluing from 60, it is revalued from 60 if you retire from 55 onwards but if you retire before 55 the 2015 scheme pension is actuarily reduced from state pension age at that time. ???
I have no idea what the above is on about.
fblm said:
ED209 said:
Lots of people have lost an absolute fortune and had plans destroyed.
Have you lost benefits you've already acrued or just different terms going forward?The government said those who didn't qualify for protection or transitional protection (me) had plenty of time to make other investments to cover the shortfall. This is a touch problematic when my take home pay is less than it was 5 years ago due to other government cuts.
ED209 said:
I have not lost accrued benefits however my future financial planning has being destroyed.
The government said those who didn't qualify for protection or transitional protection (me) had plenty of time to make other investments to cover the shortfall. This is a touch problematic when my take home pay is less than it was 5 years ago due to other government cuts.
The documentation for the 2015 scheme suggests the following:The government said those who didn't qualify for protection or transitional protection (me) had plenty of time to make other investments to cover the shortfall. This is a touch problematic when my take home pay is less than it was 5 years ago due to other government cuts.
The Police Pension Scheme 2015 “at a glance”
Many members joining the 2015 Scheme on 1 April 2015 (and those joining the 2015 Scheme at the end of their Tapered Protection Period) will also have service under the 1987 Scheme or the 2006 Scheme. The member’s accrued rights under the 1987 Scheme or the 2006 Scheme will be protected
and
"If you have accrued benefits in the 1987 Scheme or the 2006 Scheme, those benefits will remain in that scheme."
Why are your benefits under the 1987 scheme not protected, as outlined in the documentation?
ED209 said:
I have not lost accrued benefits however my future financial planning has being destroyed.
So after all that, you've lost nothing earned to date, just that future accrual is based on more economic terms?And you still pay contributions of 13.4% to receive a pension worth two or three times that amount.
And you think you're hard done by?!
ED209 said:
Retire just before my 50th birthday like i should have - this will not be financially viable as £16500 a year is simply not enough when you have a mortgage and bills to pay.
Common DB fallacies:
1. DB schemes are always more expensive than DC schemes
2. I have contributed a significant proportion of the cost of my benefit
3. The rate of accrual I experienced in year 1 will continue until I retire
4. My accrued DB benefit is guaranteed
5. I don't need to consider all that tedious stuff about investing for my retirement- my employer's doing it for me
1. DB schemes are always more expensive than DC schemes
2. I have contributed a significant proportion of the cost of my benefit
3. The rate of accrual I experienced in year 1 will continue until I retire
4. My accrued DB benefit is guaranteed
5. I don't need to consider all that tedious stuff about investing for my retirement- my employer's doing it for me
sidicks said:
ED209 said:
I have not lost accrued benefits however my future financial planning has being destroyed.
So after all that, you've lost nothing earned to date, just that future accrual is based on more economic terms?And you still pay contributions of 13.4% to receive a pension worth two or three times that amount.
And you think you're hard done by?!
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