Lump sum versus pension

jamesd

scottiescott wrote: »

I am really keen to go at 56.

So ask them what the pension and lump sum values would be for:

1. Retire at 56 but not claim until 60
2. Retire at 56 but not claim until 65.

If you work out how long your savings can last, add another one for that time.

scottiescott wrote: »

haven't done the sums regarding deferring pension and living off savings.

For a few years it's just a case of dividing your savings buy 12k to work out how many years they could last.

You can make them longer by making contributions to a personal pension then drawing on the pension for income. With that income target you'd get tax relief on the way in but no or little income tax to pay on the way our, so you'd get a pretty straightforward 25% increase in the value of your savings. Pension contribution annual limit is your earned income in rgw tax year of the contributions. Also capped at £40k but you can use carry forward to go over 49k if you didn't pay in the max in the three past years.

xylophone

I have had a quick look at previous posts - can you access the Friends Life AVC pension to cover the deferral period?

You still have the company shares?

What is their value?

You have a new state pension statement?

ajbell

It isnt just about an actuarial reduction or 4 years more pension, it is about 4 years less work and 4 years to do what you want and not what someone else wants you to do. This tends to get lost in arguments about money.

jamesd

ajbell wrote: »

It isnt just about an actuarial reduction or 4 years more pension, it is about 4 years less work and 4 years to do what you want and not what someone else wants you to do. This tends to get lost in arguments about money.

That's in part why I tend to focus on how to do it most efficiently rather than on whether to do it at all.

scottiescott

So ask them what the pension and lump sum values would be for:

1. Retire at 56 but not claim until 60
2. Retire at 56 but not claim until 65.


At 60 I would get;


Full pension - 25, 220
or
LS 128 008
Reduced pension 19 201


At 65


Full pension 25 220
or
LS 123 438
Reduced pension 18 056


Not sure why I get less LS and reduced pension at 65 but there is a reason.


By the way, I have to take my Friends Life pot at the same time as my main pension. Intend taking it as part of my lump sum.
I still have my shares. Value about £24000.