Moving civil service pension from Nuvos to Partnership

sideysid

I have been permanently employed in an organisation with the civil service pension scheme for just over a year (after spending several years contracting with them) and I am 33 years old and currently earn 27k (although I am currently applying for higher band roles - so I would eventually expect to be earning 35-45k).

I opted to join the Nuvos scheme but was unaware of the pension changes in 2015. However I have the option to switch to Partnership come April 1st before being automatically transferred to the new Alpha pension.

Due to the increased contribution rates and it being now linked to state retirement age (for me 68 and this being continually reviewed) I have been looking into changing my retirement plan.

I have a young family, and I would like the option of having more control on releasing 25% a tax free lump sum upon getting to the 55-60ish mark, and then looking at a lower annuity later on. I know these age requirements could be subject to change also.

By April I will have 1.5 years service, so have the option to for a 'notional transfer value' from my Nuvos pension so far to Partnership. I cannot freeze this until Nuvos scheme pension age (65) due to being under 2 years of service.

I am planning on making a 3% contribution so my employer would match this plus the 8% for my age bracket, and I would opt to join Standard Life over Scottish Widows. I would then increase my contributions as I get older.

I would opt to select the funds myself over a 'lifestyle' option with an outlook to review every year. Looking at the funds available, this would mostly likely be my portfolio allocation:

15% - SL BlackRock Aquila Co Over 5Yr Idx Lkd Glt Pn Fd
40% - SL BlackRock North American Equity Tracker Pension
5% - SL BlackRock Pacific ex Japan Equity Tracker Pn Fd
10% Standard Life 30:60:10 Gbl Emg Mkt Eq Trk(VG)S7 Pn (30% UK Equities)
10% SL Vanguard FTSE Developed World ex UK Eq Idx Pn
15% Standard Life Index Linked Bond Pension Fund
5% Standard Life Property Pension Fund

In regards to the above information, does this seem to be a balanced portfolio for my age and situation?

Also I know the Nuvos 'transfer value' will not amount to the contributions so far, is there any rough calculation of what I can expect, or will My CSP have to do this?

Thanks in advance for any replies.

dunstonh

15% - SL BlackRock Aquila Co Over 5Yr Idx Lkd Glt Pn Fd
40% - SL BlackRock North American Equity Tracker Pension
5% - SL BlackRock Pacific ex Japan Equity Tracker Pn Fd
10% Standard Life 30:60:10 Gbl Emg Mkt Eq Trk(VG)S7 Pn (30% UK Equities)
10% SL Vanguard FTSE Developed World ex UK Eq Idx Pn
15% Standard Life Index Linked Bond Pension Fund
5% Standard Life Property Pension Fund

In regards to the above information, does this seem to be a balanced portfolio for my age and situation?

Where is your UK equity, European, Japan, Global bonds allocations?
Why so high in US?
Why use a global equity fund when you have chosen to break down global equity into individual sectors?

hugheskevi

By April I will have 1.5 years service, so have the option to for a 'notional transfer value' from my Nuvos pension so far to Partnership.

Assuming you were to transfer, you may have to transfer a little before 1 April 2015 as that is the date the ban on transfers out of unfunded public sector pension schemes takes effect. However, as you will not have 2 years service it is possible that the transfer would be exempt from the general ban - pay close attention to the legislation when it is enacted.

I am planning on making a 3% contribution so my employer would match this plus the 8% for my age bracket

Be aware of a Govt. consultation on changes to Partnership - available here.

Also I know the Nuvos 'transfer value' will not amount to the contributions so far, is there any rough calculation of what I can expect

You can get a rough idea by using the CETV calculator on the archived Civil Service pension website, available here.

sideysid

dunstonh wrote: »

Where is your UK equity, European, Japan, Global bonds allocations?
Why so high in US?
Why use a global equity fund when you have chosen to break down global equity into individual sectors?

Thanks, I appreciate the replies.

I was looking to add the Global Equity emerging market element as there seemed little choice to cover this via the group stakeholder funds available through standard life and it provided a 30% UK equity balance. I put in a heavy allocation to US equities as I felt the asset mix of the fund were a better choice for the future, and the past performance indicated it was the best performing. I know this obviously could change in 30 years, but I would be reviewing the ratios annually.

If I changed my allocation to this, would it provide more of a balance without duplication?

10% - SL BlackRock Aquila Co Over 5Yr Idx Lkd Glt Pn Fd
30% - SL BlackRock North American Equity Tracker Pension
5% Pacific ex Japan Equity Tracker Pension
10% SL Vanguard FTSE Developed World ex UK Eq Idx Pn
10% Standard life Index Linked Bond Pension Fund
5% Standard Life Property Pension Fund
10% Standard Life Long Corporate Bond Pension Fund (to cover global bonds as per your suggestion)
10% SL BlackRock UK Equity Tracker Pension Fund
10% SL BlackRock Aquila Connect Japanese Pn Fd

sideysid

hugheskevi wrote: »

Assuming you were to transfer, you may have to transfer a little before 1 April 2015 as that is the date the ban on transfers out of unfunded public sector pension schemes takes effect. However, as you will not have 2 years service it is possible that the transfer would be exempt from the general ban - pay close attention to the legislation when it is enacted.

I'm not sure that I have much choice as the documentation states that I can only transfer on eitheir October 1st or April 1st with 3 months notice. Thanks for the linked info, I shall take note.

hugheskevi wrote: »

You can get a rough idea by using the CETV calculator on the archived Civil Service pension website, available here.

Very handy calculator, many thanks. Judging by my last pension statement (at 0.5 yrs service) x3 (1.5 yrs service) equals around 3.7k p/a. Have I been better or worse off entering Nuvos first rather than entering the Partnership pension from the start of my service?

Linton

sideysid wrote: »

Thanks, I appreciate the replies.

I was looking to add the Global Equity emerging market element as there seemed little choice to cover this via the group stakeholder funds available through standard life and it provided a 30% UK equity balance. I put in a heavy allocation to US equities as I felt the asset mix of the fund were a better choice for the future, and the past performance indicated it was the best performing. I know this obviously could change in 30 years, but I would be reviewing the ratios annually.

If I changed my allocation to this, would it provide more of a balance without duplication?

10% - SL BlackRock Aquila Co Over 5Yr Idx Lkd Glt Pn Fd
30% - SL BlackRock North American Equity Tracker Pension
5% Pacific ex Japan Equity Tracker Pension
10% SL Vanguard FTSE Developed World ex UK Eq Idx Pn
10% Standard life Index Linked Bond Pension Fund
5% Standard Life Property Pension Fund
10% Standard Life Long Corporate Bond Pension Fund (to cover global bonds as per your suggestion)
10% SL BlackRock UK Equity Tracker Pension Fund
10% SL BlackRock Aquila Connect Japanese Pn Fd

Two concerns come to mind....

The SL Vanguard Dev World fund is 59% US so there will be very high commonality with your North American Tracker. You may as well forget the US tracker and put 40% in the Dev World tracker, though I think you could reasonably up the Pacific ex-Japan a bit.

You have only 65% in equity which I think is rather low for your 20+ years time frame.

sideysid

Linton wrote: »

Two concerns come to mind....

The SL Vanguard Dev World fund is 59% US so there will be very high commonality with your North American Tracker. You may as well forget the US tracker and put 40% in the Dev World tracker, though I think you could reasonably up the Pacific ex-Japan a bit.

You have only 65% in equity which I think is rather low for your 20+ years time frame.

Thanks for the input. After reading up into the specific funds and what they consist of I think I will allocate as following and change the ratios if need be as I get older:

5% SL BlackRock Aquila Connect Over 15 Year Glt Pn Fd
80% Standard Life 30:60:10 Gbl Emg Mkt Eq Trk(VG)S7 Pn
5% Standard Life Index Linked Bond Pension
5% Standard Life Property Pension Fund
5% Standard Life Long Corporate Bond Pension Fund

The 30:60:10 consists of 30% UK 60% Overseas (US, Europe, Japan, Pacific Basin, Canada) 10% Emerging markets (China, Korea, India etc) so should cover all bases.