Miss Millicent Barclay was born on 10th July 1872, three months after the death of her father, Col William Barclay, and became immediately eligible for a Madras Military Fund pension to continue until her marriage. She died unmarried on 26th October 1969, having drawn the pension every day of her life, for 97 years 3 months. (Source - Guinness Book of Records 2007)
Most people attending our seminars are members of the Teachers’ Pension Scheme, which is a very good scheme. At retirement you will receive 1/80th of your “final salary” for every year of service. In addition, you will receive a tax-free lump sum equating to 3/80ths for every year of service. Those looking to retiring early will be subject to Actuarially Reduced Pensions but often this is not as daunting in real terms as it may seem. Once again, before making a decision consult our recommended financial advisers.
Many of you will have been saving towards retirement using AVCs (Additional Voluntary Contributions) whether in-house via the Prudential or externally. At retirement it is important to realise the size of the fund available and the benefits that can be bought with this. You do not have to take the benefits from the company that you have been saving with and it is advisable to shop around. To save you contacting numerous companies our financial consultants would do this on your behalf and advise you of the best steps forward.
Although we said earlier that saving is generally for retirement and that saving in retirement tends to be for specific purposes the exception here could be to utilise Stakeholder Pensions. Although these were introduced to primarily benefit lower-paid individuals, the rules and regulations governing them have made them an attractive tax option for those people close to retirement - or indeed, those already there. A particular point to mention at this stage is that those individuals paying into AVC contracts but with several years until retirement should seriously consider a Stakeholder alternative. Not only does this offer more flexibility than the traditional AVC contract but indeed can offer an element of tax-free cash. We are not suggesting at this stage that a change is recommended but that advice should be sought.
Teachers’ Pensions
The Teachers' Pension Scheme is the second largest Public Sector Pension Scheme in England and Wales with over 1.4 million members.
Teachers' Pensions administers the scheme for teachers in England and Wales on behalf of the Department for Children, Schools and Families. There are over 2,000 employers, of members and potential members of the Teachers' Pension Scheme, who also play an important role in the scheme's administration. The scheme administrator is Capita Hartshead, a trading division of Capita Business Services Ltd. Part of the Capita Group plc. Registered office: 71 Victoria Street, Westminster, London SW1H 0XA. Registered in England No. 2299747
Part of the Department for Work and Pensions. This website provides information and services for everyone, whether planning for retirement or about to retire. See www.thepensionservice.gov.uk
It has been set up to improve the service you receive, whether you are already a pensioner or are planning for your retirement, no matter how far off it might be. The Pension Service has a network of pension centres supported by a local service.
The Pensions Regulator
The Pensions Regulator is the UK regulator of work-based pension schemes (a work-based pension scheme is any scheme that an employer makes available to employees. This includes all occupational schemes, and any stakeholder and personal pension schemes where employees have direct payment arrangements). Telephone: 0870 606 3636 or visit www.thepensionsregulator.gov.uk
Pension Ombudsman
Investigates and decides complaints and disputes about the way that pension schemes are run. Telephone: 020 7834 9144 or visit www.pensions-ombudsman.org.uk
The Importance of Planning for your Retirement
If you still haven’t started planning for your retirement, then the following findings may persuade you to take action.
Research suggests that the average UK pensioner’s income is just £12,151 a year (1)
A staggering 40% of pensioners, equivalent to more than 4.5 million people, live on less than £10,000 a year, with more than half (55%) living on less than £15,000 a year (1)
With 25% of UK pensioners stating that they are purely reliant on the basic state pension it’s not surprising that many pensioners believe that their income is insufficient to enable them to meet their financial commitments and lead a comfortable retirement (1)
There are now more pensioners than under-16's for first time ever (2)
Average growth in the population aged over state pensionable age between 1981 to 2007 was less than 1% per year, however, between 2006 and 2007 the growth rate was nearly 2% (2)
As life expectancy continues to increase retirement planning is more important than ever as time in retirement can actually exceed time in work.
Sources: (1) Prudential 2008, (2) Office of National Statistics 2008
