General Chat Thread, Withdrawing from the local government pension scheme in General; Originally Posted by sidewinder
Oh crap Yeah thats exactly what I wanted to do, put it into an ISA.
14th July 2008, 03:19 PM #16
- Rep Power
I was annoyed because my payments were based on a percentage of salary and were out of my control. I prefer to adjust up or down what I pay in every month. The County does not let me do this. I asked last month about opting out, I was told that I could opt back in later if I wished, as others have said, do ask your LA, as it seems the rules do seem to vary.
Originally Posted by sidewinder
At time of asking how to opt out, I was given some spiel about how tax relief by government goes into the fund etc etc. The financial advice I have seen regarding this however, says this is taken back in tax when you draw your pension. They sent me the forms through, I have yet to complete and send back.
Since the rules are changing so much, I think the whole scheme is actually very risky to be locked into.
14th July 2008, 04:39 PM #17
I suggest you look into Additional Voluntary Contributions (AVC's) which are a good way to top up your pension. The Government pays the tax for you. I think you can save up to £300 per month if you're on the lower tax band, which in effect means that what you are actually paying out is something in the region of £234 per month with the government making up the difference to £300.
Originally Posted by klawd
If you are considering going down this route I suggest you speak to an Independent Financial Advisor who will advise you on how best to invest this money.
14th July 2008, 08:10 PM #18
- Rep Power
I was in the local government pension scheme for 3 years. I opted out and was told no refund after 2 years.
I have been seeking legal action to get my money back since I never signed any contract stating this.
I have noticed on the latest terms that it is within 3 months to opt out. So it has changed a lot more now.
Norfolk county Hall refuse to give me a tiny refund of under £1400.. what a joke.
It took county hall about 2 weeks to produce their own terms to me after request too.
Also since I opted out back in 2004 I go by the terms from that date, not the current terms.
Good luck on getting your refund through them.
14th July 2008, 08:33 PM #19
I was in it for 14 months then opted out when I decided to leave my job at the state school (opted out before I finished my job), got a full refund less tax which was fine, but this was back in 2003/4. I will plan for the future in my own time, i'm happier contributing my contributions to ISAs and other safer ways of saving for the moment, if they want to give me money for a pension without me giving any of my salary for one thats great i'll take that but I personally want some savings for the near future not 40 years time when im at retirement stage.
15th July 2008, 11:12 AM #20
At the risk of sounding like an old codger - thats exactly what I thought when I was a young chap - wish I hadn't been so stupid now...
Originally Posted by john
A look at any table that shows how much you need to save to get a reasonable pension illustrates how quickly the costs escalate if you don't start young. By the time I was in my mid 30s - it was already almost too expensive to do.
15th July 2008, 12:31 PM #21
- Rep Power
One thing to think about before opting out is that your employer pays into the LGPS too. At the moment I think this is 12% of salary - about twice what you pay in. If you opt out you will lose this.
As for putting all your savings into one basket such as property, shares or cash. Well, it's not a risk I would take. I have my house (all paid for), my pension (ongoing), cash and I am building up my share portfolio.
15th July 2008, 12:50 PM #22
This is a very good point, and alongside my one about the fact that pension payments are made before tax, add up to two good reasons why, unless you have proof that performance is dire, you should join a company pension scheme if you are offered one
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