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How is revalued Salary B calculated by the TPS?

Discussion in 'Retirement' started by steveroberts61, Mar 4, 2018.

  1. BELLACJ

    BELLACJ New commenter

    Steveroberts61, I read your original post and I am in exactly the same position as you, my best years being Feb 08 to Feb 11. I requested a list of my revalued salaries from TPS a couple of months ago through the messaging service but had to phone them in the end as nothing arrived. After the phone call it came the next day! It took a bit of working out but I think I’ve finally cracked the method they use to work out my average salary. You take the best 3 years they quote you and count the number of days you have at each salary figure. This should come to 1065 days. You then multiply the number of days at each salary figure by the revalued figure. Add up these totals and divide by 1065. Still awake? Amazingly it matched to the penny the average salary on my benefit statement so I’m pretty sure it’s right. Hope your figures arrive soon!
     
    steveroberts61 likes this.
  2. steveroberts61

    steveroberts61 New commenter

    Cheers BELLACJ. I will phone them again tomorrow if it hasn't come through the post in the morning.
    Did you notice if it went up or down after April and did they give you a date when the best 3 average starts to fall?
    Cheers Steve
     
  3. Dorsetdreams

    Dorsetdreams Occasional commenter

    Hi BELLACJ,

    That's brilliant.

    I was following well until multiplying by the revalued figure.

    You are multiplying by some factor, produced from the RPI / CPI. How did you get that factor? How many RPI/CPI's did it contain? 9 or 10 RPI/CPI's for the oldest year?

    And did the oldest year go all the way back to April in that year?

    Thanks!
     
    Last edited: Mar 16, 2018
  4. BELLACJ

    BELLACJ New commenter

    They wouldn’t give me any dates when it was going to start falling but when you get the revalued salaries you can see the dates where it changes? It looks like the average salary will start to go down in April and will continue to go down each month thereafter. It does, as you said previously, look like a gradual reduction each month and by August I think my average salary will be about about £250 a year less than it is now.
    This did panic me at first but it all depends on how many days you work because obviously you will be building up more service. ( service x average salary divided by 80).
    In my case, IF I’ve calculated it correctly, my pension value in August would still be a bit higher than if I opted out now and I work 3 days/0.6
    Good luck getting those figures. ( I think my near breakdown on the phone fuelled by exasperation helped and the lovely girl I spoke to felt very sorry for me!)
     
    steveroberts61 likes this.
  5. BELLACJ

    BELLACJ New commenter

    Hi Dorsetdreams,
    I’m definitely no expert so bear with me! I’ve spent months trying to work this out with my limited maths skills but this did arrive at the same figure as TPS so I’m hopeful!
    I didn’t use any CPI figures because TPS sent me my actual salary figures from the last 10 years and beside them the revalued figures. (They did all that tricky bit with CPI to work out the revalued figures) . Those were the revalued salary figures I used.
    My service was broken down into lines showing so many months at each salary.
    On my benefit statement it gives me specific dates for my best 3 years as Feb 08 - Feb11 (1065 days) so I’m not sure about them going back to the previous April although I have heard that too.
    I took each line (in those 3 years and multiplied it by the Rev
     
  6. BELLACJ

    BELLACJ New commenter

    Oops, sorry went too soon ! I counted the days in each line and multiplied it by the aforementioned revalued salary figure.
    I added up the totals and divided by 1065
    Hope this helps.
     
    roadwalker8 likes this.
  7. steveroberts61

    steveroberts61 New commenter

    I got on to the TPS this morning and they promised me I would have it by secure e-mail on Monday.
    My best 3 at the moment is giving me just over 40k final best 3 years average. If it stopped that way till December when I am 57 ish the calculator gives me a nice sum to retire on. If I froze it now at 40k and took it in December I would be £300 per year worse off but wouldn't have paid in 10 month contributions. If the 40k figure would to drop by £500 (that's a complete guess) but I paid in until Dec I would only be £200/year worse off.
    If I use my actual final salary and take it in December I would be £550/year worse off and I would have paid in 10 months. The only thing that is stopping me freezing it now is the fact that my pay went up by 2k in 08/09 (must have been me going up to UP3) and then £800 09/10 and another £800 ish the year after. Just need to get those figures off the TPS and then it wont be a gamble.
     
  8. Dorsetdreams

    Dorsetdreams Occasional commenter

    Hi Bellacj,

    It may seem rude to ask you for this, but it would be lovely to know the details of any one of those time lines. I could then test my own methodology.

    What I would like to know is (1) the start date, (2) the end date, and (3) the (revalued salary) / (actual salary) for that period.

    I've said (3) because people are sensitive about revealing salary and it is only the (revalued salary) / (actual salary) factor that I care about - I'm not trying to be nosy! That factor would be the same for everyone, over those dates.

    (I have, in fact, asked TP for my own figures, via their message system, but nothing has been forthcoming.)

    My aim in all this is to work out exactly what CPI figures go into the calculation at a given date.

    Thanks!
     
    steveroberts61 likes this.
  9. BELLACJ

    BELLACJ New commenter

    Hi Dorsetdreams, no problem, I know how frustrating it is trying to find out information so I am happy to share if it helps. Mostly the lines tend to go from April to August then September to March.
    Actual salary. Revised salary
    1/4/2008 to 31/8/2008 £34,314. £42,223
    This one was a big adjustment but for the same period in 2011, my actual salary was £36756 but the revised salary was £40,517
    Steveroberts61, it is so hard to try and work it out without your proper figures , hopefully they will arrive soon and it will all become a bit clearer once you can start calculating without having to guess!
     
    steveroberts61 and Dorsetdreams like this.
  10. steveroberts61

    steveroberts61 New commenter

    Cheers for that BELLACJ. It looks like you had around a 10.232% lift for your actual salary 2011. I have just tried this with mine and it is 1k down on my revalued Feb 2011 in which case I will be freezing it ASAP. I will wait for the figures first and let you know result.
    Steve
     
  11. Dorsetdreams

    Dorsetdreams Occasional commenter

    Well, this is frustrating. I can't get the exact factors however I play them, and I'm coming to the conclusion that the inflation rates are applied a little more cleverly than to whole years.

    This rule gets me closest: apply maximum nine cpi/rpi adjustments, with the oldest being the April adjustment to the salary from the previous April.


    E.g. salary 1/4/2008 to 31/8/2009

    Apply:

    2017/2018 = 1.0%
    2016/2017 = 0.0%
    2015/2016 = 1.2%
    2014/2015 = 2.7%
    2013/2014 = 2.2%
    2012/2013 = 5.2%
    2011/2012 = 3.1%
    2010/2011 = 0.0%
    2009/2010 = 5.0% Applied from April 2009

    This gives a factor of 1.22. Bellacj's factor was in fact 1.23.

    And salary 1/4/2011 on...
    2017/2018 = 1.0%
    2016/2017 = 0.0%
    2015/2016 = 1.2%
    2014/2015 = 2.7%
    2013/2014 = 2.2%
    2012/2013 = 5.2% Applied from April 2012

    This gives a factor of 1.13 Bellacj's factor was in fact 1.10 .
    Being nearly 3% out is frustrating. Maybe the 5.2% isn't applied to the whole year, or in-year salary changes are adjusted for.
    Any better ideas?

    Anyway, applying my rule gives me a firm conclusion: there is no cliff-edge to worry about.

    This is not advice and might be complete rubbish.
     
    steveroberts61 likes this.
  12. BELLACJ

    BELLACJ New commenter

    Sorry, just realised the last bit of my calculation is divide by 1095 ( ie 1095 days/3years) not 1065!
     
  13. steveroberts61

    steveroberts61 New commenter

    Still no sign of my revalued figures. first i was promised 48 hours. Then 10 days. On Monday I would have them e-mailed by 5pm. Tuesday I was told they were sent out by post on the Monday at 3.50pm exactly. They must be coming by donkey post. I'm a little worried that i have been lied to so many times. Just hope when I actually apply for it there's no delay in me getting my hard earned dosh.
     
  14. BELLACJ

    BELLACJ New commenter

    Steveroberts61 it really is frustrating isn’t it? I had a similar experience waiting for mine, lots of promises but no delivery. If you have the time, keep ringing them as the last person I spoke to at TPS was quite shocked that I had been waiting so long and she sent them via secure message the very next day - so it can be done quickly!
     
    steveroberts61 likes this.
  15. steveroberts61

    steveroberts61 New commenter

    Got the revalued figures this morning and using BELLACJ's calculation (cheers) it worked out to the penny with their best average . Using these figures I did the calculation for December and my best average dropped to £39328 from their and my Feb figure of £40004. Putting these figures into the TPS retire early calculator it makes a £20 a year difference to freezing it now or letting it run until December. I will however have paid over £200/month into the pension for virtually the same pension. I now need the wife to decide for me what to do!!!
    If you are thinking of retiring next year and in the next couple of years it may be worth getting the revised figures and doing the sums.
     
  16. BELLACJ

    BELLACJ New commenter

    Hooray! Glad you got the figures Steveroberts61 and the calculation worked! It is a tricky decision when exactly to opt out . Like you, I’m making contributions for very little gain on my pension but we are covered with the death in service grant! I’m planning to leave my job in July (I will be 56) and do some supply for a while. It would have been good to keep adding a few more days onto my service but my average salary will be dropping faster than I will accrue service so I think it will be best to opt out in August and defer my pension until I decide I need to take it. I hope the opting out process is a smooth one!
     
    steveroberts61 likes this.
  17. steveroberts61

    steveroberts61 New commenter

    Yes the calculation worked great. I actually missed a few days off the December calc and it now should be about £100 more. I just need to double check that if I opt out its fixed at the day of opting out and there is no loss of benefit or lump sum. Sorry its not benefit as we have bloody well paid for it!!!!
     
  18. BELLACJ

    BELLACJ New commenter

    Too right! Always good to discover you should have more than you originally thought. I also need to check about the date being fixed for opting out. I want it to take effect from 1st September but can’t see anywhere on the online opt out form to put this. Oh dear, I feel yet another phone call to TPS coming on!
     
  19. tracymicra

    tracymicra New commenter

    I've recently completed the opt out form. Downloaded. Filled in my sections then sent to Local authority for them to complete their sections and send on to teachers' pensions. As far as I can gather, you submit the form one month and are opted out from the first of the following month. Mine went in mid March to opt out from 1 April.......if it works.

    Still not certain I've done the right thing but my average salary calculation seems to be falling, so have just gone for it. Need to be opted out by birthday in July anyway so can claim pension at 60 and hopefully keep working part time.
     
  20. BELLACJ

    BELLACJ New commenter

    Thanks Tracymicra, I hope your opt out goes smoothly! I suppose it just depends on how quickly your employer returns their part of the form?
     

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