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  • FIRST POST
    • freestyle_gus
    • By freestyle_gus 10th Nov 18, 2:42 PM
    • 19Posts
    • 5Thanks
    freestyle_gus
    Transfer from Civil Service Alpha to Nest pension
    • #1
    • 10th Nov 18, 2:42 PM
    Transfer from Civil Service Alpha to Nest pension 10th Nov 18 at 2:42 PM
    I'm 40 and work full time. I've changed jobs and am now in the new company's Nest pension.

    My previous job was for DWP. I transferred my old 30,000 pot into this in the summer. Unfortunately as I was in the alpha pension for less than 2 years it has not matured and will lead to a 4,000 per year pension on retirement.

    The question I'm now grappling with is whether to transfer this pot into the Nest stock market pension?

    Any advice much appreciated.

Page 1
    • Dazed and confused
    • By Dazed and confused 10th Nov 18, 2:46 PM
    • 3,207 Posts
    • 1,604 Thanks
    Dazed and confused
    • #2
    • 10th Nov 18, 2:46 PM
    • #2
    • 10th Nov 18, 2:46 PM
    So for 30,000 and two years worth of contributions you are going to get 4,000/year from your State Retirement age?

    You have the option of taking it from age 55, albeit with significant reduction for early payment?

    The 4,000 will increase with some form of inflation linked element each year?

    Do you think using Nest is likely to improve on this?
    • freestyle_gus
    • By freestyle_gus 10th Nov 18, 2:59 PM
    • 19 Posts
    • 5 Thanks
    freestyle_gus
    • #3
    • 10th Nov 18, 2:59 PM
    • #3
    • 10th Nov 18, 2:59 PM
    I think the 4000 per year is preserved, so it won't increase. This is because I worked there less than 2 years.

    If I transfer out to the Nest pension I think it will be valued at 31,500 which is my previous pot plus the contributions I made while I worked there.

    My instinct is to transfer to the Nest and take advantage of the growth in the new pension.

    Does that make sense or am I missing something?

    Many thanks
    • p00hsticks
    • By p00hsticks 10th Nov 18, 3:04 PM
    • 6,487 Posts
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    p00hsticks
    • #4
    • 10th Nov 18, 3:04 PM
    • #4
    • 10th Nov 18, 3:04 PM
    Are you are sure you are able to transfer out ? Normally with less than two years service you would be able to but I'm not sure of the impact of transferring an old 'pot' in ?



    The civil Service alpha pension is an unfunded CARE scheme so there is no 'pot' as such - I'm not sure how your transfer in would have been handled.
    • hyubh
    • By hyubh 10th Nov 18, 3:07 PM
    • 2,302 Posts
    • 1,764 Thanks
    hyubh
    • #5
    • 10th Nov 18, 3:07 PM
    • #5
    • 10th Nov 18, 3:07 PM
    My previous job was for DWP. I transferred my old 30,000 pot into this in the summer. Unfortunately as I was in the alpha pension for less than 2 years it has not matured and will lead to a 4,000 per year pension on retirement.
    Originally posted by freestyle_gus
    This is incorrect - if you transferred in, then the two year rule doesn't apply, i.e. you have a preserved pension in the civil service scheme.

    The question I'm now grappling with is whether to transfer this pot into the Nest stock market pension?
    Not that it would be a good idea, but given you have preserved benefits in an unfunded public sector scheme, you couldn't transfer out to a DC arrangement even if you wanted to.

    I think the 4000 per year is preserved, so it won't increase. This is because I worked there less than 2 years.
    Wrong. As it is 'preserved', it is increased with inflation. If you were a member less than 2 years and hadn't transferred in, then it wouldn't be 'preserved', and instead, you would have to either take a refund of your own contributions or a transfer out.
    • freestyle_gus
    • By freestyle_gus 10th Nov 18, 3:08 PM
    • 19 Posts
    • 5 Thanks
    freestyle_gus
    • #6
    • 10th Nov 18, 3:08 PM
    • #6
    • 10th Nov 18, 3:08 PM
    I can transfer out because I left with less than 2 years service. I have a letter detailing the transfer value and the preserved pension as options.

    So, I'm asking here to make sure I do the right thing ��
    • crv1963
    • By crv1963 10th Nov 18, 3:08 PM
    • 538 Posts
    • 1,163 Thanks
    crv1963
    • #7
    • 10th Nov 18, 3:08 PM
    • #7
    • 10th Nov 18, 3:08 PM
    I think the 4000 per year is preserved, so it won't increase. This is because I worked there less than 2 years.

    If I transfer out to the Nest pension I think it will be valued at 31,500 which is my previous pot plus the contributions I made while I worked there.

    My instinct is to transfer to the Nest and take advantage of the growth in the new pension.

    Does that make sense or am I missing something?

    Many thanks
    Originally posted by freestyle_gus
    I wouldn't transfer- your 4k pa is guaranteed under written by the taxpayer and not at the whim of the market. Add SP at 8.5k you have 1k pm linked to inflationary increases for life. Your 31.5k pot cannot compete with that 4k pa.

    You'd be mad to transfer you'll get over 10% pa for your 31.5k! Plus no management fees.
    CRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!
    • Dazed and confused
    • By Dazed and confused 10th Nov 18, 3:09 PM
    • 3,207 Posts
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    Dazed and confused
    • #8
    • 10th Nov 18, 3:09 PM
    • #8
    • 10th Nov 18, 3:09 PM
    Well google has found this,

    How much is my preserved pension worth?
    When you left you would have received a statement of your pension benefits. These preserved pension benefits will have cost of living increases (pensions increases) added each year until they are put into payment.

    Please refer to your scheme guide for more detailed information.


    https://www.civilservicepensionscheme.org.uk/members/deferred/information-for-deferred-members/

    Are you losing flexibility by putting everything into Nest?

    But maybe a more important question is this. How much would your 31,500 have to grow by to give you a guaranteed, inflation linked, pension for life of 4,000 (or whatever the actual higher figure will be when the time comes).

    That's without considering spouses entitlement etc.
    Last edited by Dazed and confused; 10-11-2018 at 3:11 PM.
    • hugheskevi
    • By hugheskevi 10th Nov 18, 3:23 PM
    • 2,068 Posts
    • 2,630 Thanks
    hugheskevi
    • #9
    • 10th Nov 18, 3:23 PM
    • #9
    • 10th Nov 18, 3:23 PM
    I can transfer out because I left with less than 2 years service. I have a letter detailing the transfer value and the preserved pension as options.
    Your Scheme Administrator may have failed to appreciate that your situation is a little different to usual.

    I suggest you clarify with MyCSP how rule 28(c) (below) of the alpha regulations applies to your situation, and in particular the part of the rule I have highlighted in bold text, unless you are certain that the pension you transferred in meets the description below (ie was an occupational pension scheme).

    Meaning of “deferred member”
    28. (1) A person (P) becomes a deferred member of this scheme in relation to a continuous period of pensionable service under this scheme (“the relevant service”) if paragraph (2) or (3) applies.
    (2) This paragraph applies if—
    (a) P ceases to be an active member of this scheme in relation to the relevant service before P reaches normal pension age under this scheme;
    (b) P does not become a pensioner member of this scheme in relation to the relevant service; and
    (c) P has at least 2 years' qualifying service or a transfer payment otherwise than from another occupational pension scheme has been received by this scheme in relation to P.
    Note the definition of occupation pension scheme in this context is the meaning given in section 1 (categories of pension schemes) of Pension Schemes Act 1993:

    “occupational pension scheme” means any scheme or arrangement which is comprised in one or more instruments or agreements and which has, or is capable of having, effect in relation to one or more descriptions or categories of employments so as to provide benefits, in the form of pensions or otherwise, payable on termination of service, or on death or retirement, to or in respect of earners with qualifying service in an employment of any such description or category;
    Appreciate this is hardly the most plain English explanation, but that is how the legislation was drafted.
    Last edited by hugheskevi; 10-11-2018 at 3:33 PM.
    • xylophone
    • By xylophone 10th Nov 18, 3:30 PM
    • 27,319 Posts
    • 16,338 Thanks
    xylophone
    I think the 4000 per year is preserved, so it won't increase



    Presumably you transferred in from a personal pension?

    See

    https://www.civilservicepensionscheme.org.uk/media/95350/alpha_schemeguides4_colour_v3.pdf

    I transferred in a pension from another pension scheme. Does
    this affect anything?


    The transfer in will have bought you some additional alpha pension.
    A transfer in from a personal pension allows your pension to be preserved even if you have less than two years’ service.


    What is a preserved pension?

    This is the pension you have built up to the date you leave alpha. This pension is then adjusted in line with prices each year.


    Why would you wish to transfer an index linked preserved ("deferred") DB pension to NEST?
    • freestyle_gus
    • By freestyle_gus 10th Nov 18, 3:31 PM
    • 19 Posts
    • 5 Thanks
    freestyle_gus
    Thanks all!

    This has been really helpful.

    I will double-check with Civil Service Pensions but it seems leaving this pension where it is, is the answer.
    • kidmugsy
    • By kidmugsy 10th Nov 18, 4:57 PM
    • 12,072 Posts
    • 8,521 Thanks
    kidmugsy
    it seems leaving this pension where it is, is the answer.
    Originally posted by freestyle_gus
    By a million miles.
    Free the dunston one next time too.
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