Contracting out of SERPS

Financial Advice regarding enhanced annuity and ill health in Glasgow, Lanarkshire and across the central belt

What is SERPs?

The State Earnings Related Pension Scheme (SERPS) was a top up to the state pension, benefiting those working and paying national insurance. It operated between 1978 and 2002 and was then replaced by the State Second Pension, now the single tier pensions – a flat rate state pension that is based on the level of National Insurance contributions over your lifetime.

If you ever contracted out of SERPS, you may have a substantial amount of money sitting in a pension plan that you’ve forgotten about.
“We got really comprehensive advice and we were kept well informed every step of the way. I will certainly recommend your company to others.“


When did you last reVIEw your plans?

At Affinity, we would urge everyone to undertake a review of their contracted out arrangements, especially if this hasn’t been done for some time. Now that contracting out has been abolished, it has resulted in some fundamental changes to what you can do with your fund.


Based in Airdrie and working across Central Scotland, we offer  independent face to face financial advice. Why not give us a call?


Can I remain contracted out of SERPS?

No. Contracting out has been abolished and everyone who was out, has since been contracted back in to the state scheme. Any funds accrued from when you were contracted out are still invested with the provider that you contracted out with, or a different provider if you switched companies.

Can I cash in my SERPS?

If your SERPS pension is still with the state, it cannot be cashed in. If you did contact out of SERPS and it is now invested with a pension provider, then cashing out would be possible depending on your age, but we strongly recommend seeking financial advice beforehand as there could be serious tax implications.

How can I find my SERPs pension?

By sending your National Insurance number to HMRC, you can find out if you contracted out of SERPS. You can also use your NI number to contact an old employer and ask for details of the pension scheme you were enrolled in during your time at the company, if appropriate.

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