Pension at 54???

gorjam

I currently work in the public sector and have paid pension contributions for almost 35years.When I was employed at the tender age of 19 I had no choice but to join what they then called Supperannuation(I think).Today at the tender age of 54 I have been placed on a 90 day consultation period prior to redundancy.I will not reach 55 at the end of the 90 day but would during the 6months notice I will be given.This will probably be paid in lieu. What pension options if any do I have?

atush

See your HR dept/union and see if you can work your 6 months instead of "in Lieu" as this could bring you to 55 where you could take your pension w/o losing 30% of your pension (you lose roughly 5% per year before your scheme age). Losing 25% is better than 30%. Losing none at all is the best situation.

Also, what kind of redundancy payment/savings and investments do you have? If you could live a year or more (even to age 60)til the scheme pension age that will help you greatly. Do you have a working spouse? Could you get another job for a few years?

xylophone

Contact your pension fund administrator for information.

When I was employed at the tender age of 19 I had no choice but to join what they then called Supperannuation

Aren't you thanking your lucky stars?

Supperannuation

Superannuation but it will be paying for your supper in retirement...;)

dunstonh

I had no choice but to join what they then called Supperannuation(I think)

And you must be so grateful for that. So many given the choice opt out without realising what they are giving up.

What pension options if any do I have?

That will depend largely on your redundancy package. You will need to speak to your HR about this. Often with redundancy post age 55, they come to some arrangement over early payment of pension without penalty or a much lower penalty.

gorjam

Yes I am grateful and hopefully it will pay for my supper.
Have spoken to the union and their opinion is that the employer will be keen for me to go before my 55th birthday, as they would have to pay all the contributions I would have made up to 65, and yet they are willing for staff 55+ to take a voluntary package with their full pensions.Please can someone explain this to me?

atush

They may be keen for you to go, but if they aren't going to work this you on this then I would certainly NOT volunteer. Drag your feet?

And what is the Union's suggestion to help you? What exactly have you been paying them for?

What is the normal retirement age? If you have been in a while, should be 60, not 65?

If it is 65, then you would lose 50% of your pension.

Bigmoney2

A lot will depend on how many posts are to go, how keen they are to keep it voluntary rather than compulsory, how many volunteers they get, (I've seen redundancies where HR are almost crushed in the rush of people volunteering).

Whether your post is going or if they consider you to be 'key personal' and too valuable to lose.

I was in a similar situation a few years back and managed to retire on my 50th birthday, although this was in the private sector.

You may get lucky, its certainly possible, keep your eyes on any briefings they release on the timings and mechanisms for requesting figures etc.

hyubh

gorjam wrote: »

Have spoken to the union and their opinion is that the employer will be keen for me to go before my 55th birthday, as they would have to pay all the contributions I would have made up to 65, and yet they are willing for staff 55+ to take a voluntary package with their full pensions.

You haven't named the scheme (please do!), but if it's the LGPS, that's a bit garbled. In drawing a pension early, you are potentially suffering two sorts of reduction compared to if you stayed as an active member of the scheme until its normal retirement age:

1. Ten years less membership.
2. Additional reductions because the fund will be paying a pension to you for more years than it would have done had you retired normally.

In the LGPS, early retirement because of redundancy (possible from age 55+) only involves the first reduction, since under the scheme rules the employer pays additional money to the fund to prevent the second (this is called a 'strain charge' - charge to neutralise what would have been an unscheduled strain on the fund).

This doesn't mean 'paying all the contributions you would have made up to 65'. However, it does mean the employer has to pay contributions it wouldn't have paid otherwise. Similarly, you don't get a 'full pension' in one sense since you don't credited with lost future years of membership, but you do in another because you aren't personally penalised for taking it early.

jem16

hyubh wrote: »

You haven't named the scheme (please do!), but if it's the LGPS, .

Previous thread by OP on same subject indicates that it is the LGPS.

https://forums.moneysavingexpert.com/discussion/4441833

Goldiegirl

Bigmoney2 wrote: »

I was in a similar situation a few years back and managed to retire on my 50th birthday, although this was in the private sector.

.

This happened to me as well.

I worked in a large admin office of a bank, which shut down in Nov 2009. I was 50 in March 2010, and they kept me on for a few months more so I could take my pension as part of the redundacy package.

They just put me in a room of a high street branch and I did a few odd jobs and projects.

I approached them to see what they could do for me, so I suggest to the OP that he talks to the employer, and see what they say

gorjam

Correct it is the LGPS.