Is there a best time of year to retire?

pandora205

I have a plan to retire a few months after my SPA, which is reached in March 2019. There are some work reasons why it is best to retire in September but I'm wondering about whether there is a financial 'best time' to go.

And of course there are other reasons to go at various times of year, such as a good time for a holiday, to buy a car or for home improvements - all of which I'm planning too.

Any thoughts welcomed.

Thanks

bigfreddiel

Well one good thing is that from April 2019 you won't be paying any NI if you keep on working.

In my case I reach spa in July so my NI contributions for April, May and June are of no benefit to me, it won't be enough to increase my sp so in my opinion are elated.

fj

westv

If they are still being done then, I intend to retire just after bonus time.

pandora205

Well I've chosen September as this means I can take half my annual leave + 5 days carry over, and this brings me down to end of August (almost), which is a quiet time in my job. That means I can leave everything in order and it would be a good time to fill the post.

I'm just wondering about my annual increment that would be due from September though, as this might affect my pension (occupational). I'm a LGPS contributor protected by the underpin.... I wonder how long I'd have to had been on the new salary for that to make a difference. (Another email to our Pensions Department here.....)

Thanks bigfreddie, I'd forgotten that National Insurance stops at SPA - that's useful to know.

Ah... just discovered that the underpin is calculated at SPA or retirement, whichever is the earlier. Does that mean any pension paid after that is back to career average?

If you are covered by the "underpin” a calculation will be made at the date you cease to contribute to the Scheme, or at your Normal Pension Age if earlier, to check that the pension you have built up (or, if you have been in the 50/50 section at any time, the pension you would have built up had you always been in the main section of the scheme) is at least equal to that which you would have received had the scheme not changed on 1 April 2015. If it is not, the difference will be added to your pension.

maxie014

A lot of people at my place of work seem to wait until after the new year,get an extra year on the pension or something?
Think id go round about now myself,some decent weather to get used to the spare time,oct/nov you could have 6 months bad weather,dark nights to start off with.

kidmugsy

pandora205 wrote: »

I have a plan to retire a few months after my SPA, which is reached in March 2019.

There would be a small advantage in deferring taking your state pension until after April 6th 2019, so that you get an increment on that pension for the delay, and the increment will be based on the pension when you start it in April i.e. it will include the April uprating. If there's any risk of your paying higher rate income tax in 2019/20, you could even defer until after April 5th 2020.

Mind you, you'd want to check the rules for deferring a new-style state pension: I am familiar only with the rules for deferring the old-style pension. And the advantage might be too trifling to appeal to you.

atush

My OH will wait until after the bonuses are paid, then give his 3 months. Would take him into May/June.

Summer off, then to Florida for the winter.

peterg1965

atush wrote: »

My OH will wait until after the bonuses are paid, then give his 3 months. Would take him into May/June.

Summer off, then to Florida for the winter.

This would be where my head is. Take annual bonus which appears in March pay, give 3 months notice to leave late June, then get the bonus of a tax rebate for overpaid tax ! The year is either 2021 or 2022 for me.

pandora205

kidmugsy wrote: »

There would be a small advantage in deferring taking your state pension until after April 6th 2019, so that you get an increment on that pension for the delay, and the increment will be based on the pension when you start it in April i.e. it will include the April uprating. If there's any risk of your paying higher rate income tax in 2019/20, you could even defer until after April 5th 2020.

Mind you, you'd want to check the rules for deferring a new-style state pension: I am familiar only with the rules for deferring the old-style pension. And the advantage might be too trifling to appeal to you.

Well I'm planning to defer taking my state pension for 3 years. Also I contribute to AVCs sufficiently to take me out of higher rate tax. I'll have a look at rules to defer. I recall that the interest rate has dropped considerably.

bigfreddiel

Deferring the new sp only attracts 5.2% or 1% every 10 weeks, half what the old sp attracted.

Cheers fj

brewerdave

Forgetting financial implications (!!!!) I believe the best time to finish work is in the Spring so that you have (hopefully) long, warm days to get used to the change of lifestyle - one of my ex colleagues finished end of October -he found that first Winter dreadful - he was at home on his own as his wife was still working and it happened to be a cold ,wet Winter so he couldn't get out in the garden or on the golf course much.