Pensions Planning: The NUMBER

LL_USS

QrizB said:

westv said:

What is "immersive reader" mode?

A setting in your browser.

In Firefox on Android it's an icon showing a rectangle with lines in (like a printed page) in the address bar.

Other browsers / OSs may vary.

I did not know about this. So useful tip to know thanks.

ClashCityRocker1

I don't know how interesting my pensions "planning" is but I have arrived at where I am almost accidently.

I was wandering along earning about £45K in my Civil Service job, so with a CS pension - this was in early 2023 so had about 26 years service in mixture of classic and alpha scheme (then just approaching 64 years of age).

Then I got promoted and apart from cranking up classic pension value it took me well into 40% tax territory. As didn't really need more than £3K or so a month i diverted everything over £50K into an AVC

Since then everything I've done has been based upon getting as much take home pay as poss without paying 40%.

This year I partially retired took most of the classic and all accrued alpha and putting that all into AVC - I calculate will be caught by the £60K annual allowance rules if I stay in work throughout 2026/27 but probably will fully retire that year especially if CS offer a redundancy package which might happen. Over retirement age that will be max 50% of FTE salary.

So what I'm aiming for, my "number" if you like, is when I retire to take as much income as i can without paying 40% tax. If I can retire on between £3k and £3.5K a month will be effectively living on same amount as while I was working! AVC will be a nice pot to draw on too. Obviously I'm over state retirement age (all that goes into the AVC port too)

Stemma

I don't know if this is the correct place for this question. I received a lump sum from a previous pension when I was 50. I am now about to retire, can I get the full 25% tax free lump sum again from another pension fund?

Secret2ndAccount

It's the right area of the forum, but the wrong thread. No worries.
The answer is yes. Each pension comes with its own tax free lump sum. For a defined contribution pension (a pot of money) you can take 25%.  For a defined benefit pension (an ongoing salary) there will be a pension commencement lump sum, which typically isn't 25%. Either way, each pension has a lump sum, and you can take them all. There is a lifetime limit of £268,275 for all tax free lump sums.