Is Clwyd Pension Fund a private pension?

The Clwyd Pension Fund is based in Flintshire in the UK and is a public pension fund that also provides death benefits. Generally, most of its services are available to its members and employees of the local government. 

The Flintshire County Council is the administrator of the fund and also part of the Local Government Pension Scheme. Basically, they are also the largest council in North Wales, based in the northeast while neighboring other Welsh counties.

The local pension board and its members manage most of the assets on the LGPS funds.

What is a private pension?

There are certain rules in place so that only people over 55 apply can access the private or personal pension. Not to mention they also have the freedom and choice for how much money they want to withdraw.

Then again, will it affect local government pension scheme members? the answer is, No. In fact, these changes will only apply to “defined contribution” schemes and LGPS is a “defined benefit” scheme. So the answer to the title is the Clwyd Pension Fund a private pension?  is a resounding no. It is a funded public sector pension scheme. 

There are many flexibilities in the Clwyd Pension Fund on how you receive your benefits for the LGPS scheme. However, LGPS members have the option to transfer their benefits to a defined one which offers more flexibility. 

Also, if you want to transfer your funds then there may be some restrictions attached to the Clwyd Pension Fund. If the value of your pot or defined benefit is more than £30,000 then you need an independent or services of a restricted aadvisory firm.

However, you can only hire an FCA approved financial advisor who will be your representative and guide you through the transfer. Also, you need to prove that this advice has been taken before the transfer process can begin. 

On the other hand, if you have less than £30,000 then you dont need an advisor. Although, it is recommended in certain financial cases as there may be complicated processes for you to handle. 

Is a Local Government Pension Scheme fund safe?

In the meantime, if you are unfamiliar with the term Local Government Pension Scheme (LGPS) then let us elaborate. 

The LGPS and Clwyd Pension Fund are mainly for employees or staff who work for and with the local government. Albeit joining LGPS allows saving for your retirement and offers other benefits such as life cover and ill health protection.

In any case, if your employer is an LGPS related organisation then you will be bought into the scheme. To clarify you will need to pay and will join automatically and be added to the LGPS scheme.

The contributions to any LGPS or Clwyd Pension Fund will be directly from your pot also before any tax. In that case, if contributors are taxpayers, they will also get additional benefits such as tax relief. 

Then again, your employer will also have the option to contribute as you share the pot. Also, the payments into the fund will link to the employee's pension benefits. 

Building up your pension

LGPS will define the scheme and is set towards a few specific terms and formulas. Thus, your performance through investments will not impact your pot and the LGPS pension. 

Further your LGPS pension, on how it sums up over time see the actual calculation formula. 

Adjustment costs

The LGPS and Clwyd Pension Fund are waived each year and readjusted with your living costs. Meanwhile, the government will review the evaluation around April which will be counted before the previous adjustments. Also, this will calculate the rate which is valid till the previous September. 

Additionally, the members of the Clwyd Pension Fund will be sent a statement for the annual benefit each year. In detail, this will show your pension adjustment and its current value until the reviewed previous year is added.

Revolution Rates

After becoming an LGPS member which is certainly optional, you can pay into it or remove it from the pot. However, should always rethink and consult any professional before you do as there are certain terms only they can disclose.

Also, turning down LGPS means you will miss out on a very lucrative part of your total savings and packages.

Even though LGPS is a scheme opted for by the government, it is run locally by a selected committee. 

Should you have Clwyd Pension Fund?

You and your employer can both make contributions to the LGPS or the Clwyd Pension Fund. Besides, the amount you pay will be from your annual wages. In other words, you need to fill the pot in a specific portion of your income, around 5.5% to 12.5% from your pension pay. 

In addition, near April your employer can also decide annually how much contribution you pay towards the pot. Also your employer can set the contribution rate for secondary income if you have more than one job.

Therefore, the below table details the pay bands and rates that are applicable for contributions from April 2024.

Pensionable pay	Contribution rate
Up to £17,600	5.5%
£17,601 to £27,600	5.8%
£27,601 to £44,900	6.5%
£44,901 to £56,800	6.8%
£56,801 to £79,700	8.5%
£79,701 to £112,900	9.9%
£112,901 to £133,100	10.5%
£133,101 to £199,700	11.4%
£199,701 or more	12.5%

 

How much is Clwyd Pension Fund?

Although, if you are a returning LGPS member or completely new to investments and pensions schemes then follow these.

You have to fill out an LGPS or Clwyd Pension Fund membership form and then forward it to us. Afterward, they review your basic information on your current pensions and other LGPS affiliations, you will receive a confirmation.

You will have options on how to manage your pension as you will have to either merge or split.

Additionally, you must transfer all your previous pots into the LGPS scheme within 12 months of joining. Now it is important to take note of the fact that after 12 months there may be some difficulties.

You will have fewer options on how to deal with the pension pot as you will require your employer's permission. 

Thus, if you want otherwise it is wise to act now specifically before your employment reaches 12 months.

Your pension will increase each year and will be around 48th of your annual salary. Also, between the 50:50 section, it might reach up to around 98% of your pensionable salary around the entire pay. 

Further, based on the Consumer Price Index (CPI), the table summarises the increase in Clwyd Pension Fund.

Scheme year	Starting pension	Gross salary & rate	Current pension	Pension till date	Inflation	Pension gained
1	£0.00	£19,600 ÷ 49	£400.00	£400.00	1.20%	£404.80
2	£404.80	£23,129 ÷ 49	£472.02	£876.82	-0.10%	£875.94
3	£875.94	£25,000 ÷ 49	£510.20	£1,386.14	1.00%	£1,400.00

 

Lastly, even with all the limitations you surely start an LGPS schema safely under any employer. Not to mention, it is a great opportunity to increase your pension pot given you are already a member.