Client Portal Independent financial planning advice for teachers

Teachers Logo
  • Home
  • Advice
  • About Us
  • Seminars
  • News
  • Downloads
  • Contact
Email
Home/News/Teachers Pension/New to teaching and feeling poor?
loading...

New to teaching and feeling poor?

05/04/2020 Racheal Smith

Man in jeans with his pockets turned inside out

When you first start teaching, your salary will not overwhelm you with funds.  You may feel a little strapped.  Consequently, you may be looking for ways to increase the cash flow, just in the short term, while you gain years of experience and a pay rise.  You may wonder if there is any flexibility in the amount you pay towards your pension.  Here we offer a guide to the amount you pay and your rights to opt-in and opt-out.

Contractual enrolment

When you start work as a teacher, you will receive a contract of employment.  As part of the teachers’ contract, you will be enrolled in the Teachers’ Pension Scheme (TPS).  Regardless of how much you earn, if you are between 16 and 75, you will become a member of the TPS.  You will have money deducted from your salary and paid into this scheme.  Your employer will also be making contributions on your behalf.

Auto-enrolment

In recent years, there has been a change in the law regarding workplace pensions.  The government are aware of a looming crisis, as the population is ageing and soon people will need to care for themselves even more in old age.  Therefore, the government requires all eligible workers, whether in the public or private sector, be enrolled in a pension scheme.

Making Payments

The benefit of the pension scheme being the responsibility of your employer is that it leaves your paycheque before you ever receive it.  This deduction from your salary also means you get tax relief on your pension contributions.

It is also worth repeating that for every payment you make, your employer will pay into the scheme every month too.

Opting out

As you can tell, opting into the pension is easy.  It will happen automatically.  If you want to stay in the pension, you don’t need to do anything.  There are a lot of benefits to being in the scheme beyond your comfort in retirement.  You also receive ill-health cover, and your loved ones are protected should you pass away in service.

However, if you wish to opt-out, you can apply to the Teachers’ Pension Scheme website.  If you are in your first year of teaching, you will need to make sure your employer receives your form within three months of contractual or auto-enrolment, if you hope to get a refund on contributions already paid.

You can opt-out after these three months, but you would remain as a deferred member until you resume contributions, leave teaching or transfer your pension to another scheme.

The content in this article was correct on 10th March 2020. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on pensions for teachers and non-teachers. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.

Share this article:

  • Click to share on Facebook (Opens in new window)
  • Click to share on Twitter (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on WhatsApp (Opens in new window)
Posted under: Teachers Pension

Tagged in: Pension benefits, Teachers Pension Scheme



Make an enquiry

Please complete and send the short contact form below and we will come back to you as soon as possible.

    First Name

    Telephone

    Email

    Enter code captcha

    Message
    ifa logo
    Apple App Store Google Play Store
    • Site Map
    • Cookies
    • Legal
    • Privacy
    • Careers
    • Facebook
    • Google
    • Twitter
    • LinkedIn

    Teachers Financial Planning Limited is an appointed representative of LJ Financial Planning Limited which is authorised and regulated by the Financial Conduct Authority. Financial Services Authority firm registration number 552276. Content on this website is provided for information purposes only and should not be considered advice. The information contained within this website is subject to the United Kingdom regulatory regime and is therefore primarily targeted to consumers in the United Kingdom. Registered in England & Wales 07612896. Registered Office: St James Business Centre, Wilderspool Causeway, Warrington, WA4 6PS. Calls to 08452 69 69 90 cost 5p [or 5p per minute] plus your phone company's access charge.

    © 2011-2020 Teachers Financial Planning Limited.
    Website designed and developed by Carpe Diem
    This website uses cookies to improve performance: Find out more.