Civil Service Pension at 55 - Reduction Buy-out

Tom99

hugheskevi wrote: »

Correct, but the OP could not start a new classic Added Pension contract, only an alpha Added Pension contract.
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[FONT=Verdana, sans-serif]Does that make any difference? Won't an Alpha Added Pension increase the pension paid at age 55 just the same as a classic Added Pension would have done?[/FONT]

BobQ

hugheskevi wrote: »

Correct, but the OP could not start a new classic Added Pension contract, only an alpha Added Pension contract.

As the OP is now in Alpha building up just 6 more years which gets paid when he/she is 68+ may not be sensible.

An alternative might be to opt to move to the Partnership Scheme which is a DC scheme with a good employers contribution and pay into it more than his current employees contribution. So at age 46+ the employer would pay in 14.75% plus up to 3% of matched contributions. So if the OP paid 7% of salary the fund would see 24.75% of salary each year.

The Alpha is better and guaranteed but if he/she does not want to wait to draw it until 68+ or have it actuarially reduced to get it earlier and is willing to take some risk it is an option for someone retiring 5 years before the Classic NRA

hugheskevi

[FONT=Verdana, sans-serif]

Does that make any difference? Won't an Alpha Added Pension increase the pension paid at age 55 just the same as a classic Added Pension would have done?

If the OP plans on commencing their alpha pension at age 55 the effect would be pretty much the same. But that is not clear, especially as the OP is trying to avoid an actuarial reduction in one pension, so solving that by creating an actuarial reduction in another may not be desirable.
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Tom99

£45k sounds very cheap for 5 extra years of pension. If the OP is in the Classic scheme then I presume they have been with the Civil Service for quite a few years.

Golactico

Tom99 wrote: »

How much extra pension pa at age 55 does the payment of £45k get you?

Just over £2K pa

Golactico

Tom99 wrote: »

£45k sounds very cheap for 5 extra years of pension. If the OP is in the Classic scheme then I presume they have been with the Civil Service for quite a few years.

circa 30 years

BobQ

Tom99 wrote: »

£45k sounds very cheap for 5 extra years of pension. If the OP is in the Classic scheme then I presume they have been with the Civil Service for quite a few years.

If the OP is 49 now he has moved into Alpha already and has a "closed" Classic/Premium pension.

BobQ

hugheskevi wrote: »

[FONT=Verdana, sans-serif]If the OP plans on commencing their alpha pension at age 55 the effect would be pretty much the same. But that is not clear, especially as the OP is trying to avoid an actuarial reduction in one pension, so solving that by creating an actuarial reduction in another may not be desirable.
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Except one involves an actuarial reduction of 5 years and the other at least 13 years.