Teachers Pension or Civil service alpha pension

pricecelt

i am a Senior leader in a school 47 years old and have opportunity which would involve me switching pension to civil service alpha pension. im hoping to retire at 55 I've been in the teachers pension since 1997
Any help greatly appreciated.

NedS

Congratulations. CS Alpha is a good scheme. Accrual rate is 2.32% of your annual pensionable salary, which is definitely one of the more generous.

Did you have a question? Are you considering transferring your teachers pension into Alpha? If so, you will need to compare the two schemes to see what you are giving up / gaining by transferring. How do you plan to fund your early retirement (at 55) through to when your DB pension(s) kick in? Do you have other savings / assets put aside for this or are you planning on taking DB pensions early with actuarial reduction?

pricecelt

HI yes, sorry my question is i would need to leave the teachers pension soo yes is it worth my while transferring into the Alpha scheme.  What doo i need to compare I'm absolutely rubbish at this sort of thing.
And yes i would hope to take my pension a little earlier than the current 60 years age

NedS

Well, the first thing to consider would be the normal retirement age of the scheme. If the normal retirement age of your current teachers scheme is 60, and you transferred that pension to Alpha where the normal retirement age is the equivalent of your State retirement age (67?), you'll be working 7 years longer before you can draw your pension without actuarial reduction. Maybe the transfer value will offset the extra actuarial reduction.

You would need to request a quote and then compare the two scenarios and see which works out best for you, either transferring or leaving your teachers pension where it is (in deferment) and starting to build more pension in Alpha from scratch.

Andy_L

Options
1. Leave your TP where it is. It will then increase in line with inflation (CPI)
2. Transfer it to the CSP. As they are both public sector scheme this will be a "fair" transfer, ie they will both use the same assumptions over valuing the pension and changes in scheme retirement ages. It will however ignore any change in salary between the 2 jobs, good if you've gained a pay rise, bad if a pay cut. It will then increase in line with pay rises, good if career progression & cost of living pay rises outstrip inflation but bad if they don't.

OldBeanz

You have only a year to do this and the pension departments will take x months of that - where x is a number they want to think of between 2 and 11.
You need to get the figures from MyCSP and come back here and people will give an opinion.
Be aware that the TPS decreases any year on year increases from CPI +1.5% to CPI if you leave the scheme for more than 5 years.

hugheskevi

The decision is made more complex by the McCloud judgment. This means the pension choices should you move to Civil Service are:

• 1a - Leave Teachers pension as a deferred pension, choose legacy scheme for 2015-22 service when you retire. Legacy pension will increase by CPI from date of leaving until retirement.
  
• 1b - Leave Teachers pension as a deferred pension, choose new scheme for 2015-22 service when you retire. Teacher's pension accrued prior to 2015 will increase by CPI from date of leaving, new scheme pension earned between 2015-22 will be linked to CPI+1.6% until date you left Teacher's scheme, and CPI thereafter.
• 2a - Take Club Transfer of Teacher's Pension, choose legacy scheme for 2015-22 service when you retire. Teacher's pension will be linked to earnings until you leave Civil Service scheme, and CPI thereafter.
  
• 2b - Take Club Transfer of Teacher's Pension, choose new scheme for 2015-22 service when you retire. Teacher's pension accrued prior to 2015 will be linked to earnings until you leave Civil Service scheme, new scheme pension earned between 2015-22 will be linked to CPI+1.6% until you leave Civil Service scheme, and CPI thereafter.
  

Note that legacy schemes are likely to have a protected minimum pension age of 55, whereas new schemes are likely to be 57.