Civil Service pensions (EPA)

[SpursFan2]

I work in the Civil Service and my expected retirement age will be 68.

I have the option of retiring up to 3 years earlier and getting an unreduced pension if I get an EPA (this involves paying extra monthly pension contributions to build up this allowance).

I have just applied for an EPA and I’ll start paying the monthly contributions from April (the start of the next financial year). I’ll continue paying the contributions each year unless I opt out of it (you can choose each year whether to opt in or out for that year).

Has anyone else on here paid into an EPA in the Civil Service? Would be interested to hear your thoughts and experiences. Thanks!

Hi all, just bumping this in case anyone has any advice or thoughts on this. Thanks! 😊

I did this but for a very short period. I personally thought it was worth it when I signed up. I’m impacted by McCloud so my experience isn’t typical.

Ah thanks for posting @Propertylover - did you find the EPA scheme helpful? I’m wondering how beneficial it will be if I do it for a few years and then stop. I think I’ll just see how it goes over the next year (my first year of doing it) and then take it year by year.

@SpursFan2 I ended up retiring early just 9 months after I opted for EPA and by then knew I was affected by McCloud so it isn’t straightforward for me to assess how beneficial it was.

The good thing is you can do it a year at a time and opt in and out.

I always knew I would retire at 60 if not before and was only in Alpha because I was forced out of Classic as part of the taper protection. For me being entitled to full Alpha at 65 rather than 67 meant any actuarial reduction if I took it at. 60 would be c25% rather than c35% - it’s roughly c5% per year.

However, the actuarial reduction option means I get the same money overall but paid at a lower amount for more years e.g. 60 to 80 is 20 years where as 65 to 80 is 15 years so my choice was 20 years pension at 75% vs 15 years at 100%. Does that make sense? I did a few spreadsheets before deciding but I was only looking at 4 years Alpha max vs 30+ years Classic.

That all makes sense, thanks so much.

I realise it’s a complex topic, as it really depends on someone’s specific circumstances (e.g. their age, what age they are planning to retire), but I’m wondering if you might know how much one year of EPA contributions counts for?

I think you mentioned it would have counted for around 5% of overall contributions in your situation, if I’ve understood correctly.

@SpursFan2 you really need to talk to MyCSP. They are really helpful and can give you far more accurate information than I can.

My understanding is at Normal Pension Age (NPA) you get your pension in full. If you chose to take your pension early the actuarial reduction is I believe c5% for each year. So if your NPA is 68 and you take your pension at 65 you lose c15%. If you take it at 62 you lose c30%.

If you pay the EPA you get that year (s) pension in full 1, 2 or 3 years before NPA. If you pay 3 years then at 65 you get your pension in full (3 years before a NPA 68.) So if you then decide to take your pension at 62 you only lose c15%.

You must not make a decision based on what I have said you must talk to MyCSP to make sure you understand the impact for you.