Should i opt out of the Civil Service pension scheme?

silver918

So i have been enrolled in this scheme for almost a year and i have paid into it. I am having doubts about whether i should stay in as i'd rather have the money right now. Since its backed by the government is it likely to crash (i.e will it all just collapse and leave me with nothing?)

I currently pay about £130 a month out of my salary every month and i'd rather have it as cash i can stick in a Lifetime ISA. What is the best thing to do?

Dazed_and_confused

As a taxpayer I think you should leave.

Joking apart which scheme are you in? Do you understand what your contribution entitles you to.

Each year.

For the rest of your life.

And if you stop contributing you will probably have to pay £26/month more in tax.

silver918

I am in the Alpha scheme, I have had serious thoughts about leaving as i will pay more money in than i will receive.

Linton

silver918 wrote: »

I am in the Alpha scheme, I have had serious thoughts about leaving as i will pay more money in than i will receive.

Why do you think that?

Dazed_and_confused

Seriously!

That £130 (probably only £104 after tax relief) is going to entitle you to a seriously good pension. The accrual rate in Alpha appears to be very good when compared to lots of other pensions.

Have you actually worked out what your pension entitlement is for a years contributions?

Remember that amount will increase with inflation and could easily be paid for 30+ years.

Dazed_and_confused

Linton wrote: »

Why do you think that?

Broken calculator?

Peelerfart

Wow! Seriously thinking of leaving?

Most people wouldn't leave such a scheme IMHO.

Thrugelmir

silver918 wrote: »

I am in the Alpha scheme, I have had serious thoughts about leaving as i will pay more money in than i will receive.

Care to show how you've arrived at these figures?

marlot

silver918 wrote: »

I am in the Alpha scheme, I have had serious thoughts about leaving as i will pay more money in than i will receive.

As a fellow member of the Alpha scheme, I can tell you that you've mis-understood the scheme if you think this!

marlot

silver918 wrote: »

...I currently pay about £130 a month out of my salary every month and i'd rather have it as cash i can stick in a Lifetime ISA. What is the best thing to do?

If you pay in every month for just one year (probably less after tax relief), you're entitled to 2.32% of your salary EVERY YEAR of your retirement.


If you pay in each month for a second year, you get another 2.32% EVERY YEAR.


And just in case you're worried about inflation, the amount you get goes up with CPI between now and retirement.

greatkingrat

silver918 wrote: »

I am in the Alpha scheme, I have had serious thoughts about leaving as i will pay more money in than i will receive.

That is unlikely to be correct unless you are in poor health and have a reduced life expectancy.