Stop buying back years

Hello,

I was wondering what happens to the contributions I've already made buying back years when I now stop doing so?

I am working for the HSE and I started buying back 8 years about 5 years ago but consider now leaving the public service within the next 6 months. Would the contributions I've made so far be buying me at least some of my additional pension entitlements on a pro-rata basis?

Thanks,

cologneboy

It sure would. If I were you and had the finance to do it, I would ask could I make a lumpsum payment to buy back the remaining years service before you leave.

Baracuda said:

If I were you and had the finance to do it, I would ask could I make a lumpsum payment to buy back the remaining years service before you leave.

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A few years, this would have been good advice. However, in the current environment, the OP has to make a judgement of whether he is confident that Govt will be able to honour its commitment to pay the pension in the future.

I was not giving advice I was offering an opinion

Who knows what the future holds regarding pensions but what we do know is that there is a pension's time bomb waiting to explode over the next 20 to 40 years. We also know that PS/CS is the most generous type of the all at the moment and there is no plans to retrofit the proposed C.A.R.E. system for existing PS/CS pensions. By looking at the present cost of buying back years compared to trying to fund the shortfall through AVC's to me it is a complete no brainer!

Baracuda said:

By looking at the present cost of buying back years compared to trying to fund the shortfall through AVC's to me it is a complete no brainer!

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If you look just at the cash figures, I'd fully agree with you. My point is that you have to factor in the risk that you won't actually get some or all of the promised payout when you retire.

Yes there may be a risk alright but given the fact that there is a proposal to bring in a C.A.R.E. system for new employee's dramatically reduces the risk that future governments will not be able to pay pensions in the future, would you not agree?

Baracuda said:

a C.A.R.E. system for new employee's

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What is a C.A.R.E. system?

Complainer said:

What is a C.A.R.E. system?

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The Government is bringing this in for new employee's As far as I can remember it is to come into effect from the 01/01/2012 but in reality the PS will not be recruiting for a few years yet. It will dramaticly reduce the cost of providing DB pension benefits for the state, it will also stop the current practice of some employees doing masses of overtime and going on to shift to try and push up their final pensionable salary before retirement

I don't know that this will address the major issues pushing us towards default - primarily the banking debt and the huge interest arising.

This step will certainly not stop the government from defaulting in the near future if it is going to, but what it does do is put future government on a sounder financial footing as a result. Perhaps I was assuming that OP was a long way from retirement considering the OP's user name, that was wrong i guess on my part.

What gets to me is that i heard of Cornmarket/Marsh using your arguement to try and sell their products as opposed to buying back years.

If the government is going to default it will affect pensioner's and people near retirement now and for the next 5 to 10 years but you need to remember that the economy will not always be this way and things will improve in the future and IMO thoes that are 10 years or more from retirement should continue to buy back years. Thoes who are less than 10 years should continue also but you are right when you say that their is a risk but again IMO the risk is low as the government is making all the hard decisions to try and avoid defaulting.