#NHSpension #financialplanning #careerchange #pensions
Hey everyone! 👋 I could use your insights on a big decision I’m facing. I’m considering taking a 7k pay cut to move into the public sector, specifically the NHS. I know the NHS pension is supposed to be one of the best out there, but I’m trying to figure out if it will outweigh the decrease in salary. 🤔
Here’s what I’m thinking:
– Should I use a pension projection tool to compare my private pension against an NHS projected pension?
– Are there other factors I should be considering when making this decision?
– My current pension contribution is 17% of 58k (including employer contribution) – how does this compare to what I could expect with an NHS pension?
Any advice or personal experiences would be greatly appreciated! Let’s help each other make informed decisions about our financial futures. 💸💡
Comparing the two isn’t straightforward.
How old are you? When do you hope/plan to retire?
You won’t get a straight comparison for this. 17% is already very good. I think it’s probably just about a wash but the key is the career progression.
What current job what nhs job what pay grade
I will get shot down for this – so be it – but can you allow the best years of your life to be dictated by those at the tail end of your productive life?
You say this is in line with your career goals – I assume you would find this more fulfilling and thus more mentally engaging. That is just as valuable as any pension contribution.
I’ve plenty of nursing colleagues who do night shift and look awful for it – more money but horribly unhealthy. Thus for more pension they are sacrificing health in the now.
Money isn’t everything. Cut your cloth – you’ve said you will progress job wise – there’s other savings vehicles you can use to top up your pension savings – SIPPS spring to mind.
Pension shouldn’t be the tie break essentially 17% is pretty good and you may be able to salary sacrifice the extra 7k into your current plan anyway which would make it compatible with the NHS conts (and tbh private plans are actually more flexible in many ways especially around estate benefits) realistically if the job suits you better 57-50 wont be a brutal hit (probably around £300 a month) so if the job suits you better then go for it
When I went to the public sector my company pension contribution went from 4% to 16%, so that is a 12% uplift + tax to your public sector salary, if you compare to your private sector salary.
When I compare pension I use the 4% rule, you live off 4% of your pension each year. So a 50k pension pot is worth £2000 a year pension. If you are moving to a final salary/career average pension then investing 50k in a pension would be worth £3500 year, so an extra £1500 a year?
I’m sure there are people who know better than me but now, when I am looking to move out of the public sector I look at salary + employer pension contribution, and how the private sector package compares. If there is a pension shortfall, then the cost of making that up myself in salary.
What amount are you putting into the current pension?
I’m doing the same leaving a job I hate. I lose the company car which is effectively £5k pay cut as I’m having to fund one.
The way I look at it though, if I go to the new place, enjoy it and get back on the career ladder, it’s the best move I’ve ever made.
If it’s rubbish, my line of work with the same sort of employee I’m leaving is around everywhere. I work in civil engineering and leaving a contractor and going client side.
I hate my current job and there is more to life than money. You only live once, make the most of it and enjoy it
I, an engineer at a blue chip firm, make over twice as much money as my NHS working wife. I top up my pension, and it’s a good one. I’m happy with my pension projection.
Her pension income based on current projections will be 20% more than mine.
Anecdotal yes but her pension is stellar.
That being said, would I take a £500 a month paycut now to improve my pension outcome? No.
All depends on the band you are going into, also holiday allowance absolutely is ahead of the private sector ( especially when you reach the over 10 year mark and get 33 days + bank holidays on top!)
I did the opposite. Moved from the NHS on about 50k to private on 60. I’d say after taking into account the pension it was a pretty straight swap and not as much of a pay rise as it looks.
So yeah a 7k payout is probably fine.
One thing you’ve not mentioned is out of that 17% you currently put in, how.much is your? employer. (For the NHS role you’ll be expected to put about 11% of gross in)
NHS employer contribution is 23% of your pensionable pay if that helps?
Op, I’m a Police officer and my partner is a radiographer in the NHS. Both are parents also work in public service style roles.
Both jobs will tell you you’re not there to get rich. I understand the requirement to be able to survive, and sure, the pension is nice, but I’ve read a good chunk of this thread and I think one important thing for you to understand is that the monetary compensation, the good pension, whatever, is worthless if you dont/won’t enjoy the role and don’t think you’ll feel better at the end of the day for doing it. I know this seems obvious but I think plenty of people forget that you can enjoy a job.
Depending on the role (clinical at least,) expect to have a lot asked of you, expect to give up weekends, evenings, miss family events, probably have people pissed off at you. Unless it’s the standard managerial role, you’ll want a partner who supports you making that sacrifice. And if it’s clinical or patient facing, expect dark humour as a coping mechanism, and to need to express yourself in a way that keeps you sane.
At the end of the day, this is the cost of many a public service role and while it definitely has a monetary value, that’s one you could do with working out before you start the new job.