McCloud Judgement - Nuvos, Alpha and EPA

jasser1492

I joined the CS in 2010 and was part of Nuvos (with a retirement age of 65) but was then transferred to Alpha (with a retirement age of 67). 

In Alpha I paid additional contributions (EPA) to be able to retire early at 65. 

However, the McCloud judgement as I understand it effectively gives me option of choosing between Nuvos and Alpha (up to the point of the judgement), so have I effectively paid these additional contributions for nothing? 

hyubh

jasser1492 said:

I joined the CS in 2010 and was part of Nuvos (with a retirement age of 65) but was then transferred to Alpha (with a retirement age of 67). 

In Alpha I paid additional contributions (EPA) to be able to retire early at 65. 

However, the McCloud judgement as I understand it effectively gives me option of choosing between Nuvos and Alpha (up to the point of the judgement), so have I effectively paid these additional contributions for nothing? 

If you went for the legacy scheme option, there would be a refund for any non-convertable additional contributions as applicable. However it's not obvious to me that Nuvos will prove better (slightly lower NPA, but lower accrual rate) - is that what your numbers are telling you...?

Dazed_and_C0nfused

The accrual rate is just over 99% of Alpha with inflation increases so the earlier NPA may make it more attractive than Alpha?

jasser1492

If I take the projected pension values for each scheme, and divide by the number of years I contributed, Nuvos was giving me a higher pension per year of contribution and an earlier retirement age. So I’m not sure whether that’s a valid way of looking at it it, but it appears Nuvos is better (to me). 

jasser1492

jasser1492 said:

I joined the CS in 2010 and was part of Nuvos (with a retirement age of 65) but was then transferred to Alpha (with a retirement age of 67). 

In Alpha I paid additional contributions (EPA) to be able to retire early at 65. 

However, the McCloud judgement as I understand it effectively gives me option of choosing between Nuvos and Alpha (up to the point of the judgement), so have I effectively paid these additional contributions for nothing? 

If you went for the legacy scheme option, there would be a refund for any non-convertable additional contributions as applicable. However it's not obvious to me that Nuvos will prove better (slightly lower NPA, but lower accrual rate) - is that what your numbers are telling you...?

When would I get the additional non convertible contributions refunded? Do I have to wait till 65 (over a decade away)?

hyubh

jasser1492 said:

If I take the projected pension values for each scheme, and divide by the number of years I contributed, Nuvos was giving me a higher pension per year of contribution and an earlier retirement age. So I’m not sure whether that’s a valid way of looking at it it, but it appears Nuvos is better (to me). 

What you get each year is straightfowardly your pensionable pay x the accrual rate (1.023 for Nuvos, 1.0232 for Alpha). Revaluation of previous years' accruals is the same in both schemes (CPI).

hugheskevi

jasser1492 said:

jasser1492 said:

I joined the CS in 2010 and was part of Nuvos (with a retirement age of 65) but was then transferred to Alpha (with a retirement age of 67). 

In Alpha I paid additional contributions (EPA) to be able to retire early at 65. 

However, the McCloud judgement as I understand it effectively gives me option of choosing between Nuvos and Alpha (up to the point of the judgement), so have I effectively paid these additional contributions for nothing? 

If you went for the legacy scheme option, there would be a refund for any non-convertable additional contributions as applicable. However it's not obvious to me that Nuvos will prove better (slightly lower NPA, but lower accrual rate) - is that what your numbers are telling you...?

When would I get the additional non convertible contributions refunded? Do I have to wait till 65 (over a decade away)?

It should be offered within 12 months of 1 October 2023, alternatively you can convert it into nuvos added pension of equivalent value.

hugheskevi

hyubh said:

jasser1492 said:

I joined the CS in 2010 and was part of Nuvos (with a retirement age of 65) but was then transferred to Alpha (with a retirement age of 67). 

In Alpha I paid additional contributions (EPA) to be able to retire early at 65. 

However, the McCloud judgement as I understand it effectively gives me option of choosing between Nuvos and Alpha (up to the point of the judgement), so have I effectively paid these additional contributions for nothing? 

If you went for the legacy scheme option, there would be a refund for any non-convertable additional contributions as applicable. However it's not obvious to me that Nuvos will prove better (slightly lower NPA, but lower accrual rate) - is that what your numbers are telling you...?

Nuvos is a very interesting case for McCloud as the only significant difference is the NPA and ancillary benefits are the same as alpha.

Therefore for those with a state pension age of 65 alpha is better than nuvos, but for those with state pension age above 65 nuvos will be better except for cases of ill health. The difference in accrual rate is so small as to be irrelevant in most cases, and the difference in NPA is much more important (but NPA becomes irrelevant for ill health, and if an enhancement applies a higher NPA is better so alpha wins in those cases).

jasser1492

hugheskevi said:

jasser1492 said:

jasser1492 said:

I joined the CS in 2010 and was part of Nuvos (with a retirement age of 65) but was then transferred to Alpha (with a retirement age of 67). 

In Alpha I paid additional contributions (EPA) to be able to retire early at 65. 

However, the McCloud judgement as I understand it effectively gives me option of choosing between Nuvos and Alpha (up to the point of the judgement), so have I effectively paid these additional contributions for nothing? 

If you went for the legacy scheme option, there would be a refund for any non-convertable additional contributions as applicable. However it's not obvious to me that Nuvos will prove better (slightly lower NPA, but lower accrual rate) - is that what your numbers are telling you...?

When would I get the additional non convertible contributions refunded? Do I have to wait till 65 (over a decade away)?

It should be offered within 12 months of 1 October 2023, alternatively you can convert it into nuvos added pension of equivalent value.

Brilliant, thank you.