‘We could not be happier’

Gold-plated final salary pension schemes are known to be the most generous out there, but that is not to say they suit everyone.

Raj Muvva, 39, a GP in Scotland, said he had transferred his money out of his NHS pension into a self-invested personal pension two years ago and had been very happy with his decision.

Mr Muvva said he had made the decision to quit the scheme when he realised that he would not have access to his full pension until he was 67. He was also concerned he would never see all his money again.

He said: “I don’t expect to live past the age of 85, so I do not plan to spend all of my pension. By then, my children will be grown up and I can leave something to them, but I would not be able to do that in a defined benefit scheme.”

NHS doctors up and down the country have been grappling with punitive pension rules for higher earners and incomplete pension records.

Most savers can put up to £40,000 into pensions each year while getting tax relief. But higher earners see this annual allowance gradually reduced to a minimum of £10,000 a year under the so-called “taper”.

Faced with paying hefty tax charges, some doctors have already been forced to reduce their working hours, pull out of the pension scheme or even retire early.

Mr Muvva said he had been contributing £36,000£38,000 a year to his pension. After consolidating his pension transfer with an existing pot, he said he had £250,000 in his personal pension. This has since grown to almost £360,000 thanks to carefully selected investments, he said. “I do take an active interest and change the funds I am invested in regularly. I can do that independently and have enjoyed the freedom,” he added.

“Some friends who left the scheme and did not actively manage their investments have barely grown their funds.”

Mr Muvva said he planned to contribute for another two to three more years. After this, he said he hoped to have grown his pot to a total of £600,000 when he took into account another pension worth £150,000.

The doctor said his wife had also transferred her pension out of the NHS scheme at the same time and had since stepped up her contributions to £30,000.

It was tricky to find a financial adviser to take them both on at the beginning, he said, but the entire transfer was smooth beyond that. Mr Muvva said he was convinced they had made the right choice.

‘I do take an active interest and change the funds I am invested in regularly’