Pension or redundancy..

tichbourn

If I take redundancy and been there 7 years, age 58, I know what I will get. How can I work out what employer would contribute to my pension if I went down this road instead - strain on fund costs that is. So length of employment is 7 years and 7 years till Im 65. I'm trying to find out which is the better option

atush

You ask them.

If this a DB scheme, there will be regulatiosn about what happens on redundancy after age 55.

And if a DC scheme, you will get a package that may include some preferential terms re pension as per your contract.

If not, if you redundancy pay is over 30K, you get 30K tax free and the rest can be put in your pension to take either immediaetly as you are over 55, or later as you wish.

hyubh

tichbourn wrote: »

How can I work out what employer would contribute to my pension if I went down this road instead - strain on fund costs that is.

What's the scheme? The 'strain on fund costs' lingo suggests LGPS...

tichbourn

Redundancy wont be over £30k, so it would be all tax free. I'm just unsure of how a strain on the fund costs would affect my pension. I don't understand how it would be calculated. I know I could start to draw it earlier as employer would be pay a lump based on salary calculations, but what would happen to my pension once I reached 65, would I still be drawing the same amount or would it increase as I would have withdrawn the strain on the fund figure? Hope this makes sense!

tichbourn

Yes its lgps

jamesd

To understand more about strain on fund cost have a read of this. Your employer would pay a strain on fund amount into the LGPS based on your lump sum, annual pension payment and age when you retire.

tichbourn

Thanks for your replies . Out of curiousity, How do I work out what my lump sum would be ?

AlanP_2

If it is the LGPS scheme you should have been sent an annual Pension Statement by your employer which will give you an illustration of the Lump Sum amount and how that would affect the annual pension.

Do you have any statements?

hyubh

tichbourn wrote: »

Yes its lgps

In which case there's little point bothering about what the strain charge to the employer will be. Roughly speaking it negates would would have been an actuarial reduction were you to have retired early voluntarily/not via a redundancy. However, it's not something you can bargain away for something else - if a strain charge is due, it's due.

tichbourn

ok, thanks for your replies