British pensions: final salary scheme alert, are you informed of your position?

british-mgRecently UK advisers have written about the concerning situation affecting many British final-salary schemes and their members.

You may have such a pension scheme after working in the UK for a few years.

What do you need to consider, if you have one and you’ve moved overseas? 

Unfortunately many of these schemes, are likely to be underfunded today, by your old employer.

A UK pension-Final salary scheme aims to provide a guaranteed pension benefit to its members. The benefit is calculated based upon your actual salary in your final years of employment. These schemes are not linked to actual sharemarket performance and most have been closed to new members for years.

The concerns about solvency or liquidity of the funds in order to pay ongoing final-salary pensions can be read about further in online news articles such as the Royal Mail final salary pension, the British Steel pension fund negotiations to reduce pension benefits of its 130,000 members, as reported in The Financial Times, and previously The Express wrote about a crisis for the final-salary schemes of major FTSE-250 companies, here.

If you need more information about your own scheme, or to understand your options with regards to final salary pension schemes when you have left the UK in particular, or in the event your pensions scheme appears underfunded, please contact the author.

Update to this article: May 2020:

At the end of February 2020, the PPF reported that amongst the approximately 5,000 defined benefit (DB) transfer funds in the UK today, there were almost 3,500 DB schemes in deficit. The combined total value of the deficit of these schemes at the end of February 2020 was £244.8 billion.

Please see updated information concerning such pension transfers, here, and you can request specific assistance at this british pensions  page.

NB: Please note this information is general and does not represent personal financial advice. Such advice can only be provided after your full financial situation is taken into account by a qualified financial adviser.

photo credit: jeremyg3030 MG TD via photopin (license)


All thoughts are my own. The information contained here is not personal financial advice tailored to individual needs.