Should i opt out of the Civil Service pension scheme?

hugheskevi

Opting out entirely is 100% wrong.

The Civil Service offers a non-contributory Defined Contribution scheme called Partnership as an alternative to alpha. You do not have to put anything into Partnership, and automatically get an employer contribution of at least 8%. Any contributions you put in, up to 3%, are matched by the employer. So even if you are convinced you do not want to be in alpha, you would choose Partnership.

That leaves you with 3 choices:

(1) alpha 4.6% / 5.45% / 7.35% member contribution rate depending on income

(2) Partnership - contribute 0%, and get employer contribution of between 8% and 14.75% depending on your age

(3) Partnership - contribute 3%, and get employer contribution of between 11% and 17.75% depending on your age, giving a total contribution of between 14% and 20.75% depending on your age.

There are of course choices for a contribution rate between 0% and 3%, although hard to see why anyone would choose that in most circumstances.

badmemory

My fellow tax payers will thank you whilst smirking at people's lack of financial education. Put another way - please don't do this unless you have seriously reduced life expectancy. Unless of course you already have a couple of millions in the bank - in which case - go for it!

Kynthia

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.

I would really love to see the maths you used to come to that conclusion! I can't remember the exact figure but people have worked out they get all their money back after just 3 or 4 years of retirement. As people tend to live a lot longer than that, and have a spouse that will receive a percentage of the pension even after they have gone, generally it's a fantastic return on their contributions.

ffacoffipawb

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.

You are Diane Abbott and I claim my £5

ABC easy as 943

Apodemus

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.

You have clearly been mis-sold this pension and should sue...



...the education system!

Pollycat

Saw the title of this thread and when I'd picked my jaw up off the desk, I read that everyone had beaten me to the comment I was going to make.

Bravepants

As a member of Alpha, I have only one comment...!!!!!!?!


Seriously though, if you only have a limited amount of money to put away for your retirement put it somewhere that will guarentee income that rises with inflation! That's Alpha! The accrual rate is 2.32% of your salary and you company will contribute too. As your pay level rises so does your and your company's contribution. You are also saving tax.

Some general rules I save by...

If you wish to retire early consider the actuarial reduction before normal retirement age (55 to 67 or 68), and perhaps augment it with a SIPP.

If you want to retire EVEN earlier consider a S&S ISA.


(Edited to correct my blunders!)

Joey_Soap

no ......................

Paul_Herring

Ok, more seriously - are we sure the OP isn't simply trying to troll?...

Pollycat

Paul_Herring wrote: »

Ok, more seriously - are we sure the OP isn't simply trying to troll?...

I guess it's a possibility.


But trolls usually fabricate far more colourful stories embellished with all sorts of lurid details.