USS vs Alpha? And what to do with my LGPS pension?

hazel_davey

Hi, I've seen some super replies on here so...
I'm 47. I have 14 years of LGPS pension, 9 of which are final salary (in addition, I transferred a previous 1 yr private sector pension into the LGPS ASAP but I don't think it bought me much more than 6 months...).
I've been working in the private sector for 3 years on statutory minimum pension before redundancy last July; I started working in a University last Sept, enrolled in the USS pension which looked pretty good to me.
I've since been incredibly lucky to be offered another role with the Civil Service, with the Alpha scheme. Which would be the better scheme? 
Also; I've kept my LGPS pension for now - I've seen people on this thread regret not transferring it into Alpha; would that be a worthwhile move? Or would I lose my final salary link if I did that?
I'd like to make up the 3 years lost in the wilderness and retire early if possible!

Wobble101

Others will come along with far more expertise than me. But for now, in answer to your specific question, Alpha wins hands down as far as I’m aware, as a defined benefit scheme albeit one based an the average of your earnings vs final salary. I say this as someone who has made a similar move. 

Be aware that if you were to transfer in other pensions to your Alpha you have to do it within 12 months. I was not sufficiently clued up about that and missed the opportunity. 

Andy_L

Wobble101 said:

Others will come along with far more expertise than me. But for now, in answer to your specific question, Alpha wins hands down as far as I’m aware, as a defined benefit scheme albeit one based an the average of your earnings vs final salary. I say this as someone who has made a similar move. 

Be aware that if you were to transfer in other pensions to your Alpha you have to do it within 12 months. I was not sufficiently clued up about that and missed the opportunity. 

USS is also a career average defined benefit scheme. It also has an extra DC bit for high earners.

CS accumulates at a higher rate of 2.32% vs 1.3% but the USS comes with an automatic 3x lump sum as well
Alpha has lower contributions, 4.5-8% (depending on salary) vs 9.6%

Andy_L

hazel_davey said:

Hi, I've seen some super replies on here so...
I'm 47. I have 14 years of LGPS pension, 9 of which are final salary (in addition, I transferred a previous 1 yr private sector pension into the LGPS ASAP but I don't think it bought me much more than 6 months...).
I've been working in the private sector for 3 years on statutory minimum pension before redundancy last July; I started working in a University last Sept, enrolled in the USS pension which looked pretty good to me.
I've since been incredibly lucky to be offered another role with the Civil Service, with the Alpha scheme. Which would be the better scheme? 
Also; I've kept my LGPS pension for now - I've seen people on this thread regret not transferring it into Alpha; would that be a worthwhile move? Or would I lose my final salary link if I did that?
I'd like to make up the 3 years lost in the wilderness and retire early if possible!

If you leave it where it is it will increase by inflation. If you transfer it it will link to your final salary in the CS/University. Since it  will be be a"public sector transfer club" transfer that will be on "fair" terms but will ignore any change in salary between the  new and old jobs. That's a win if you get a pay rise with the new job but, probally, a loose if you've taken a pay cut.

hazel_davey

Andy_L said:

Wobble101 said:

Others will come along with far more expertise than me. But for now, in answer to your specific question, Alpha wins hands down as far as I’m aware, as a defined benefit scheme albeit one based an the average of your earnings vs final salary. I say this as someone who has made a similar move. 

Be aware that if you were to transfer in other pensions to your Alpha you have to do it within 12 months. I was not sufficiently clued up about that and missed the opportunity. 

USS is also a career average defined benefit scheme. It also has an extra DC bit for high earners.

CS accumulates at a higher rate of 2.32% vs 1.3% but the USS comes with an automatic 3x lump sum as well
Alpha has lower contributions, 4.5-8% (depending on salary) vs 9.6%

If my maths is right (it's not great!) it looks like the USS lump sum would be circa £24k; however the CS scheme would pay nearly twice as much as the USS annually (based on an assumption I'd be on the same pay for the next 20 yrs, purely for  comparison purposes), therefore I'd gain back that £24k in increased pension payments in 2.5 years approximately?
I'm aware it's a gamble on either side that the pensions would stay the same over the next 20 years!

AlanP_2

Asking for transfer in quotes does not commit you to making the transfers so worthwhile filling the forms in and finding out actual numbers would be my suggestion.

I transferred a DC pot in to the LGPS when I joined but said no to the benefits offered on an old DB transfer.