Transfer a small Royal London and NHS Pension to LGPS?

swindiff

Hi
My partner has a Royal London pension which has a transfer value of £4279.30

She has recently changed jobs and joined a Local Government Pension Scheme. They estimate that the transfer would buy an annual pension of £404.76 and a contingent spouse's pension of £123.96

I am trying to determine whether it is worth transferring or not. The royal London do not give an annual pension value because I guess they can't. You would just buy an annuity at the time of retirement with whatever it's current value was?

She is currently 47 so 20 years from the current state retirement age. If the pot grew at 5% per year for 20 years it would be worth £8558.60 which would take about 21 years to recoup at £404.76 per year, however that does not take into account any increase in pension in the LGPS scheme due to inflation.

She also has an NHS pension which we are waiting to get a transfer value for.

Can anyone with more knowledge on the subject help us make a decision.

Many thanks

Silvertabby

£8558.60 is a maybe.

£404.76 per year index linked for life is a definite - although that would be reduced for early payment if your partner retired/took her LGPS benefits before 67.

There is no right or wrong answer, I'm afraid.

swindiff

I realise it's a maybe and a very big assumption, but I have to start somewhere. Just after opinions from people with more experience in pension matters that me if this seems like a good deal or not really.

dunstonh

The royal London do not give an annual pension value because I guess they can't.

They can give you a projection but it will be to very low assumptions.

Some of the old RL plans have very generous guaranteed annuity rates (in double digits).

You would just buy an annuity at the time of retirement with whatever it's current value was?

That is one of the options. Not the only one though.

Does she plan to retire at scheme and state pension age or go earlier than that? Earlier retirement could favour keeping the RL pension and using it to fund the gap.

swindiff

We are both 47 and would like to retire before state pension age. How much before I have no idea, but as early as finances allow, it's the 4% per year actuarial reduction that's a killer

swindiff

dunstonh wrote: »

They can give you a projection but it will be to very low assumptions.

Some of the old RL plans have very generous guaranteed annuity rates (in double digits).

Is this something that we need to specifically ask them for?
The LGPS requested a transfer value from Royal London and these are the only figures the supplied.

dunstonh

Is this something that we need to specifically ask them for?

That sort of info is not normally given unless you ask for it. The general phrase you would ask is if there are any safeguarded benefits. Safeguarded benefits are a catchall for all types of guarantees.

You effectively get what you ask for. No more, no less. Especially if the info is requested by a scheme.

We are both 47 and would like to retire before state pension age. How much before I have no idea, but as early as finances allow, it's the 4% per year actuarial reduction that's a killer

And that is where the RL scheme could come into play. It could fill some of that early retirement period without having to take the reduction on the main scheme.

swindiff

Cheers dunstonh, much appreciated

swindiff

Would the RL pension be index linked?