Nuvos or partnership pension?

jamesd

They can't advise - if they did they might be later required to pay you the difference between the best and worst of the two choices in your specific case. So most employers will say exactly nothing that might influence your decision.

Do remember that you're nto stuck with only whatever you get from this work pension. It's normal for people to put money into S&S ISAs to invest for retirement or into personal pension pots for the same. Both allow money to be taken earlier than most work schemes, making early retirement practical, something many people want. Bit early for that for you for now, better to do the work pension and start building up a deposit for a property purchase so you can do that and save money compared to renting.

Andy_L

atush wrote: »

I agree.

Hugh makes a compelling case with his math. But that is assuming certain performance so I'd take the Nuvos as then you aren't the one carrying the investment risk.

You aren't carrying investment risk but do carry legislative risk - any chance of another back-dated change to indexation?
You also get investemnt rewards (if you're lucky ) & the option to "flex" your pension eg dependants benifits, indexation, lump sum at a market rate rather than the punishuing 1:12 rate.
I'm not sure if hugheskevi allowed for investing the spare 0.5% that the lower contribution in partnership allows - which could go into an ISA instead, possibly helping with tax planning

Nuvos vs Partnership is a close call following Nuvos being far more affected by the RPI/CPI switch than the other public sector schemes.

hugheskevi

I'm not sure if hugheskevi allowed for investing the spare 0.5% that the lower contribution in partnership allows - which could go into an ISA instead, possibly helping with tax planning

No I didn't.

Partly because under Partnership you would pay higher NICs due to being contracted-in (but build up more State Second Pension in return) which would largely offset this.

I did think about doing it, but it was a bit superflous without knowing how future contributions will change - the answer is very different if the OP is protected from the contribution increases in which case NUVOS is probably better, compared to if the OP is a earning more than average, in which case they will be paying perhaps 4 percentage points more in the next few years, which would change the maths to be heavily in Partnership's favour.

atush

Andy_L wrote: »

You aren't carrying investment risk but do carry legislative risk - any chance of another back-dated change to indexation?
You also get investemnt rewards (if you're lucky ) & the option to "flex" your pension eg dependants benifits, indexation, lump sum at a market rate rather than the punishuing 1:12 rate.
I'm not sure if hugheskevi allowed for investing the spare 0.5% that the lower contribution in partnership allows - which could go into an ISA instead, possibly helping with tax planning

Nuvos vs Partnership is a close call following Nuvos being far more affected by the RPI/CPI switch than the other public sector schemes.

It is a close call, but given I have never been (nor ever will be) in a FS or DB scheme I like the idea of a small part of my pension where I am not carrying the investment risk lol. But like I said Hugh's math made a convincing arguement.

I opened a pension statement today in which (only one old one we are still paying a small amt into) and although we put in 1800 this year, it didn't go up. but given what happened in august and after we didn't lose much and beat the Ftse by far lol.