Transfering or preserving a company pesnsion

[sniff diesel]

I recently changed companies within the rail industry so in the same pension scheme and have the option to either transfer my old pension or preserve it.

Was wondering if anyone has had to make the same decision and what they chose and why.

[mybrainhurts]

You need to know the terms and benefits of both schemes, then compare them...

[sniff diesel]

haworthlloyd1 said:

if its the same pension then there is no difference i think

It's within the same scheme (railways pension scheme) but being as my current salary is less than I was on (but will go up after training) it's a bit less straight forward.

[sniff diesel]

The figures are:

pensionable pay in previous employment: £20,437
pensionable pay in current employment: £17,561 (but this will increase to £32,500 after training)
membership in previous section: 5 years 286 days

Now if I transfer they will credit my pension with 6 years 90 days membership (an extra 169 days I presume due to me being on a lower salary now) given me an annual pension of £6808 with a lump sum of £17,101 (figures shown in today's money)

If I don't transfer then the previous pension benefits are an annual pension of £1274 with a lump sum of £2911 plus the current benefits of an annual pension of £5716 plus a lump sum of £14559 - making a total of an annual £6990 plus a lump sum of £17270.

Now those figures suggest I'll be marginally better off by not transferring, but then the preserved benefits will only increase in line with RPI whereas the current benefits increase in line with my pensionable pay. Now typically our pay rises are marginally above RPI, so I can see the transferring option being worth more in 34 years time.

Have I missed something out?