HELP! Understanding the Alpha Pension Scheme

BobQ

SallyAnneBooth wrote: »

Thanks for all the brilliant responses here!

What are peoples thoughts on Alpha vs Partnership? I appreciate it comes down to personal preference but would like to get your opinions.

And yes we're capped at 1% atm as well, no decent pay rise for the forseeable future. It's frustrating as our London weighting always remains constant and they don't adjust for inflation or CPI

Partnership vs Alpha is more than a personal preference. In Partnership less money is paid into your pension pot (and yes you do have one in Partnership) overall. Because Alpha is only a notional employer contribution all you can do is think of it in terms of what you would have to pay to get the same benefits. But in general terms with Partnership the personal and employer contributions are less and the benefits lower. Once you are over 40 the Partnership employer's contribution rises but for a 30 year old Partnershsip makes little sense unless you plan to move to the private sector in the near future.

p00hsticks

OP, I hope that isn' your real name that you are using as a user name ?


You've already revealed in this thread that you are a 30 year old civil servant in the London area - you're setting yourself up to be the potential victim of identity fraud if you're not more circumspect.

Thrugelmir

SallyAnneBooth wrote: »

Employers monthly contribution: £1013/month.

Part of this will allocated to fund the existing scheme funding deficit. Not specifically to you. In effect it is an internal tax imposed on your employer. When deciding how to allocate their monetary resource. Balancing the National accounts is a long term project.

sammyjammy

Dazed_and_confused wrote: »

I think you've misunderstood this. The annual pension will be based on their final salary but isn't equal to the final years salary. Unless they have worked a very long time!

It is more likely to be 40/60ths of their final salary or possibly 40/80ths. 40/60ths schemes may not have an automatic lump sum either.

Alpha is 60ths and Classic is 80ths, hence the lump sum.

sammyjammy

GunJack wrote: »

I hope for his sake you put him well and truly right ???

Waste of time, its Corbynism at its worst.

hugheskevi

sammyjammy wrote: »

Alpha is 60ths and Classic is 80ths, hence the lump sum.

I think you mean premium is 60ths, not alpha.

Alpha is 43rds, part of the difference reflecting that future increases are linked to CPI rather than salary and that the normal pension age is State Pension age rather than age 60.

jimi_man

SallyAnneBooth wrote: »

Thanks for all the brilliant responses here!

What are peoples thoughts on Alpha vs Partnership? I appreciate it comes down to personal preference but would like to get your opinions.

And yes we're capped at 1% atm as well, no decent pay rise for the forseeable future. It's frustrating as our London weighting always remains constant and they don't adjust for inflation or CPI

Hi.
I've recently joined the Civil Service and I posed this very question recently.

https://forums.moneysavingexpert.com/discussion/5997447/civil-service-pension-decision&highlight=partnership

I already have a fairly good DB pension in payment so I was all set to join the Partnership scheme, despite the Alpha scheme being a very good scheme especially if you are in your 50's apparently (I'm 54).

However I've been automatically enrolled into Alpha and I decided it would be a bit daft to turn down such a scheme, so I'm staying in it. In fact I've opted to do the EPA which brings the age down to 65.

If you already have a substantial DB pension built or building up, then I guess I can see the reasons for Partnership to give you some flexibility, like I was considering in my case. If you don't then I would definitely stick with Alpha - the figures just don't stack up with Partnership.

SallyAnneBooth

Thanks for all the responses everyone I am very grateful, has definitely aided my decision to stick with Alpha.

atush

You seem to be concentrating on a lump sum.

i suggest if you want one, not to take one from your DB pension but instead open a DC pension alongside (be it a sipp, AVC or PP}) and build that up and take a lump sum from it.