Pension adviser charges

JoeCrystal

I am getting confused here as well, to be honest. Are you still employed by the Civil Service or you already left? What was your contribution rate for it at the time you was contributing into it and if there is a fund, what is the name of the fund it was invested in? That would quickly clear up if it is Nuvos (DB pension) or Partnership scheme (DC pension). 

Here is an old leaflet about them: https://www.civilservicepensionscheme.org.uk/media/29994/nsp_np.pdf

Albermarle

Defined Benefit scheme , means a pension where you get a fixed guaranteed income . As opposed to a defined contribution scheme , like you have via the FA.
Defined benefit schemes are generally much better and cost the employer quite a lot to fund .
https://www.pensionsadvisoryservice.org.uk/about-pensions/pensions-basics/workplace-pension-schemes
The princely sum you mentioned of £3K , probably inflation linked is actually theoretically worth about £100K in cash terms .

MNrhubarb

Thanks both.
Joe, it's an occupational defined benefit pension scheme. I am still employed and paying into it.
I don't get the difference? You say it means I am guaranteed an income, but surely with a private pension you are pretty much guaranteed an income too dependant on how much you have paid in? The statements I receive from both pensions show a projected pension income. For the private pension it's around £2.5k pa and for the Nuvos one it's around £3k pa. I assume this will be my income once I retire? I am not planning to take out any lump sums as I don't want the annual income to go down any further.

AlanP_2

The big, big difference is who holds the RISK.

For your PP you do, if your investment choices, or your advisors, turn out to be absolute dogs (and that is total exageration btw to illustrate a point) you will be trying to live off peanuts in retirement, couple with the fact you need to guess your life expectancy and withdraw with the objective of not getting to £0 before you die.

On the other hand for your CS DB scheme the government (or arguably taxpayers) hold the risk - They are promising to pay you £3k a year for life, with spouse benefits after that if applicable.

Another way of looking at the relative values is to total up how much you have contributed to them and see where the best value is, remebering that your PP projection (which is likely to be an underestimate of what you can actually withdraw when it comes to it) will probably be based on continuing contributions until retirement whilst your CS DB is based on what you have "in the bank" now and all future years will add to that.

Albermarle

For the private pension it's Projected  around £2.5k pa and for the Nuvos one it's Guaranteed around £3k pa. 
That is the critical difference . 
If you read the links you might understand a bit better. Here it is again https://www.pensionsadvisoryservice.org.uk/about-pensions/pensions-basics/workplace-pension-schemes

LHW99

Presumably Nuvos also has some level of inflation protection when in payment? That is even more useful IMO