Final salary pension help

Linton

Andy66 wrote: »

Hi there - looking for some advice on final salary pensions. I am 46 and currently have 22 years in a 60'ths scheme plus an additional year of avc.

The company is not going the way I would like and I have a couple of job offers which are interesting but I feel a little tied to the pension.

If I was to leave can anyone confirm at what age I could retire and access the scheme at the earliest - my understanding is that this is 65 ?

This makes it an even harder decision but if I was able to access my pension at 60 or earlier then it would seem to be a real option to move on.

Appreciate your thoughts on this and if I was to leave what the best options are for further pension provision or scheme transfer - note any new employer would offer money purchase scheme only

Many thanks

Andy:A

I suggest you put together a financial plan for your retirement based on:

1) Estimated income requirements - eg current requirements minus mortgage/ commuting etc.
2) Estimated retirement date
3) State pensions
4) Pension earned so far
5) Alternative incomes from now - eg more FS pension, S&S ISAs, personal pensions

You may find that you already have earned sufficient income to be able to retire at SPA, so any savings from here on are focussed on bringing your retirement earlier. Alternatively you may find you have no choice but to carry on for some time in the job you dont enjoy, but at least you will know why you are carrying on and when you can expect to leave.

taking_stock

Andy66 wrote: »

Hi there - looking for some advice on final salary pensions. I am 46 and currently have 22 years in a 60'ths scheme plus an additional year of avc.

The company is not going the way I would like and I have a couple of job offers which are interesting but I feel a little tied to the pension.

If I was to leave can anyone confirm at what age I could retire and access the scheme at the earliest - my understanding is that this is 65 ?

This makes it an even harder decision but if I was able to access my pension at 60 or earlier then it would seem to be a real option to move on.

Appreciate your thoughts on this and if I was to leave what the best options are for further pension provision or scheme transfer - note any new employer would offer money purchase scheme only

Many thanks

Andy:A

to address your questions...

most schemes allow for taking defined-benefit pensions earlier than the scheme date (in your case 65), but most will also charge a reduction to reflect that it will be in payment for longer. many, if not most, schemes will allow you to take it from age 55.
for example, in the civil service scheme, the actuarial reduction is 5.25% (if i recall) for each year taken early - and that's the downside - taking it 10 years early (if allowed) would half the annual pension for life.

as for the idea of transferring, this is usually only sensible if you're taking it to another defined-benefit scheme.

As for the top-up pension idea (which is imo always a good one), it (usually) gets tax relief automatically in that you put in £80 and £100 appears automatically (for basic rate taxpayer). At any point after 55, including while you're still working if u want, you can take 25% of the total tax-free in your hand and then choose to buy an annuity with the rest or use a drawdown.

hope that helps.