combining lgps pensions

macca789456

Hi. If a deferred period of lgps service is joined to an active period of lgps service, is the value of the deferred benefit built up to annual pension and lump sum over the years, through inflation increases, not retained, and is just the service years carried forward to the newly joined pension. Many Thanks.

jem16

macca789456 wrote: »

Hi. If a deferred period of lgps service is joined to an active period of lgps service, is the value of the deferred benefit built up to annual pension and lump sum over the years, through inflation increases, not retained, and is just the service years carried forward to the newly joined pension. Many Thanks.

That would be correct which is why it's important to look at it closely before combining.

macca789456

Hi would anything change if made redundant if combining aged over 55 many thanks.

jem16

macca789456 wrote: »

Hi would anything change if made redundant if combining aged over 55 many thanks.

You've already asked all of these questions on your other thread. Best to stick to that really.

https://forums.moneysavingexpert.com/discussion/5018386

However the basic answer is once they are combined, that's the set of rules that's followed as they are no longer two separate pensions.

Perhaps it would have been better to ask the questions before combining rather than after?

hyubh

macca789456 wrote: »

Hi would anything change if made redundant if combining aged over 55 many thanks.

Normally, being made redundant between 55 and your normal retirement age in the scheme leads to an automatic early retirement and the employer paying a 'strain charge' to the pension fund to cancel out any actuarial reduction. As such, combining runs the risk you make yourself too expensive to let go, e.g. if the situation is a round of voluntary redundancies and there are multiple applicants. (If you don't combine, the deferred pension remains deferred and only the membership from the latest job is taken account of when calculating the strain charge.)

woolly_wombat

This is not going to be much comfort to you, but I elected to combine a previous period of lgps membership a few years back after I was re-employed on a higher salary.

Unfortunately I had no way of knowing that several years of wage freezes were around the corner and I'd have been better off keeping my first period of membership separate/deferred! Now I'm over 55 I am unlikely to be made redundant.

I have been on numerous courses to try and break into a new career, but have finally had to accept that it's not going to happen, unless I forgo a permanent job for temporary/bank employment.

These protective mechanisms in public sector pensions can provide a welcome safety net but they do have unintended consequences for older people who want to keep working.

WW

hyubh

woolly_wombat wrote: »

These protective mechanisms in public sector pensions can provide a welcome safety net but they do have unintended consequences for older people who want to keep working.

Maybe so, but given what you've said, the only reason combining wasn't as opportune as you'd hoped was because your salary hasn't kept up with inflation. That's hardly an 'unintended consequence' of 'protective mechanisms' - indeed, the 'protective mechanism' in play here would seem to be the fact that combining memberships wasn't automatic, and required an explicit election.