Workplace pensions

Maries you should be able to ask them for a projection of what your pension will be at such and such a date. I asked my employer for several different projections so that I could plan when to retire. It seemed to be quite a simple process for them to work it out.

The money will be invested in a private pension plan, which is independent of the company, even though it is being offered to you through them. So if they go bust, the money invested and the plan will be unaffected by the collapse.

The best thing you can do is contact your local CAB (Citizen's Advice Bureau) who will be able to help you themselves or direct you to someone who can offer the help you need.

Is there anywhere other than the personnel office I can get a forecast of what I might get etc.?

I have two problems here:
a) the firm do not know my real age because they have never asked me
(if they did they would retire me off next year at 60 because that is what they do ).

b) anything you ask there is the knowledge of the whole workplace before the end of the day.

Yes, it is an external provider, but since I am not yet enrolled I cant ask them. I wanted to know if it was worth it or if I will end up paying in more than I am likely to end up getting out. As I understand it I can opt out and as a part time person with just a small number of years to go, it might not be worth it.

My own calculation on 1/60 with my salary is that I wouldget around £1000 a year in five years time ( if I was lucky).

www.moneysavingexpert.com/savings/discount-pensions

I don't know whether this link is helpful maries

A final salary scheme would be more secure than one invested in the stock market, but you should be able to get a projection of that and of any added years into the state pension.

It doesn't sound much, but £1, 000 pa return for six years contributions sounds quite generous imo. I contributed more than that into AVCs for a lower return.

I think they will need to know your dob when they enrol you into the scheme, however.

As Nightowl and Rosequartz said you ought to be able to get a projection.

The only reason I am being auto enrolled is because the govt require it. This pension scheme was never open to me because I am unqualified although I do the job, and because I have never had enough salary until recently to trigger the system. Its a "professional pension". I have lots of other qualifications equivelent and better but not the one they recognised for admission to the scheme, changes in working systems put me above most of those qualified recently and the scheme was opened up this year because of work place pensions.

In fact, I still should not be in it because I earn less than £15000 a year. The pension had a set salary grade of 15K. But clearly the rules have changed with the govt requiring auto enrollment in workplaces.This is the one my employer uses and therefore it has to be the one I am put in.

Now that might be an advantage but for only 12 months or 5 years, it isnt really a lot and may well end me up paying more in tax when I retire.

The only reason I might consider it is because I will have a shortfall in my state pension ( because of my work record) . If I could make it pay back that ( £94 a week according to the forecast),it might be worth it.

The other thing is, having read the papers, it seems that I may be able to buy extra years ( this isnt AVC's which they the pension provider also has also have a scheme for with the pru' apparently). This is pension.

You are allowed an additional pay in of £5K a year but they do not say how much that is worth in terms of years pensions added on. I have a couple of defunct ISA's which would be possible to take out and pay in
(around 15K) - if I can work for long enough which might make it worth it if its years added to the pension and I could buy back say 20 years or so over the next 5 years.

I have looked at the providers web site and got this information.

But it still leaves me not knowing what to do. That all assumes of course I get to keep my job. If I lose it, I wont have another one as no one would employ me again at my age.

Whilst £1000 for 5 years pay in may seem good ( its less than £10 a month pension) , in my situation it is more likely to cost me in any benefits I might get in old age ( my luck - like being caught on the pension changes three times)

Thanks for the advice.

Ask your pension provider for a forecast, they will be happy to provide this.
I am retired now but I managed to work out my pension based on the booklet information which I was given I then compared this to the forecast.

Pensions can be complicated to work out and all pensions are not the same.
Mine was based on the best salary of the last three before I retired.

Yes, I got that re added years, sorry if I didn't make myself clear.

I bought AVCs alongside my works pension. My friend, who worked for her husband's firm, bought added years. I am not sure how they compare.

I would be wary of drawing out my ISA to put into a pension scheme of any kind; a bird in the hand etc. But that is just my personal opinion. I wish I had been able to have my AVCs as a lump sum, at least you have control over them. Another friend never got the full amount back as she died far too soon. It is a gamble.

And if your future pension pay-in is low you would be able to draw it as a lump sum .(sorry, I thought you meant a return of £1, 000 pa which seemed remarkable for the time involved paying in)

Not sure of all the new rules but there is plenty of information out there - if you're like me whatever you choose you will wish you had chosen the other option!

Thanks for the suggestions and advice everyone.

I have checked further into it today using some of those online calculatorthings provided by the pension provider and even the government.

It isnt tlooking that attractive to be honest.

As I am a low income earner, my pension is going to be reduced anyway because as a final salary one, it willonly ever be around £6K pa tops on my part time pay ( and that would be with 40 years contributions).

I wont get more than 1K pa or £10 a month income at best.

If I added years it would be more expensive. They would require £100,000 as a lump sum to buy back 20 years at my age ( which would be the maximum allowed because thats how long I have worked in the industry which is the key to buy back). Its all done on age, hence the reason they do not tell you how much it costs to buy a years pension. That would give me an income in retirement of around £100 a month.

It has to be a lumpo sum because if I pay it in additional installments it would cost all my salary a month and be even more expensive. Leabing it a year or two would costme even more too ( as I get older it gets more expensivbe as alump sum they want for the same income in retirement).

If I am going to do that, then a similar lump sum may well buy me an annuity of similar value it seems and I could hand on to my money for five years. ...... not that I have 100,000K to spare right now.

Just paying for a pension with no top up will costme £50 a month ofmy salary which given it is less £200 now, means my take home will drop to £150 and I have to pay petrol costs from that of £50 a month ( and run a car, no public transportavailable) It would barely seem worth going to work.

I am sorry to sound so negative. I really do not want to be.

I compared all of this to some savings ( actually an inheritance ) I have in a building society account I have currently. For example, in one account £40,000 giving me an income of £120 a month ( thats a MONTH after tax) now. Yet a pension wont give me any more? I have another with more in it,also giving a monthly income

Now whilst I cant guarenteethe rates, the money isnt at risk because its notstocks and shares etc. It would make more sense for me to do more of the same with my salary and even take out more ISA's and forget the pension! Thats not the received wisdm of the government but it seems to be the case. Most advisory sites dont say what to do for women ( or men) like me - knocking 60 but I did read money saving expert who said that most workers around 59/60 + years are opting out of workplace pensions. It didnt say this was good or bad.

So again I am being ( it feels) ripped off.

My situation is not desperate. My husband has his pension ( he is already retired - made redundant and retired off at 60 and he has been an unhappy man for 5 years now). He gets his state pension soon ( the old one before April 2015). Thats will make his income ariubd £300 a month plus my money ofaround £200 a month and when I retire in under six years I will have a state pension ,with shortfall of around £94 according to the forecast). Thats because of many years of not earning enough in the 1980's -all those zero hours and low pay contracts coming home to roost on my NI contributions when I was in my 20's and 30's in the last recession.

But if hubby dies he will leave me with a widows pension of £100 a month ( all curent values and inflation hedged), and I have my savings and house to call on, so I should not complain, I am better off than many.

I'm not sure if you meant added years in the State pension, Maries, or in your firm's scheme.

Either way, I think if it was me I would hang on to my money, hoping that interest rates would go up at some point in the future and give a better return. At least if you hang on to it you can use it if you need to replace household goods, etc. And you have control over it.
My AVC annuity is taxed. At least you don't pay tax on a cash ISA and you can shop around every so often.

If a pension is not going to add a significant sum to your retirement pension, then I would be inclined to avoid it. Too many people have been caught out by finding that the small increase in their pension they get from years of careful and thrifty saving leaves them with a total income only a few pounds above the benefit level and that few pounds precludes them from a whole range of benefits.

I think in this case you are probably better off putting the money aside inside an ISA wrapper. No tax is paid on the income and you have a capital sum available if it is needed to meet any domestic or other emergency.

https://www.google.com/url?q=http://www.theguardian.com/money/2014/jun/01/government-plans-dutch-style-collective-pension-scheme&sa=U&ei=RjGLU7SANaGJ0AWLsoGQDw&ved=0CAYQFjAA&client=internal-uds-cse&usg=AFQjCNHx_k5L7XENWmTgn7OxpudGy0KLtQ

Should the government be allowed to do this at this point in the parliament? It's going in the Queen's speech next week.
Surely the DWP has messed up enough under Duncan Smith.