Financial advisor for LGPS transfer out £31000

hyubh

Silvertabby wrote: »

Let's just say that, in my experience, employers only throw more money into the pot if they really have to (ie, redundancy). More likely that anyone who takes their benefits from 55 will have at least 5 years of early payment reductions.

Right. And dare I say, quite right too...

Johnnyboy11

Silvertabby wrote: »

Let's just say that, in my experience, employers only throw more money into the pot if they really have to (ie, redundancy). More likely that anyone who takes their benefits from 55 will have at least 5 years of early payment reductions.

So it appears that you can now voluntarily retire from age 55, but if you do so before age 60 you'd lose all Rule of 85 protection, ouch!

hyubh

Johnnyboy11 wrote: »

So it appears that you can now voluntarily retire from age 55, but if you do so before age 60 you'd lose all Rule of 85 protection, ouch!

Depends what way you look at it. If you literally lost all Rule of 85 protection, the countback for the actuarial reduction would start from 65 not 60. Paying an unreduced pension before it was originally possible to be paid out unreduced carries a cost to the pension fund, which needs to be made up somehow. Moreover, the same principle has always applied when calculating strain charges for employer-led early retirements (which are always unreduced according to scheme rules).

gadgetmind

My wife has a tiny LGPS pension but I reckon the money she's put in there is easily giving 5x the return it would do if she took it tax free and we invested it wisely. She could take it with close to 50% reduction at age 55 but I doubt we'll bother TBH.

Johnnyboy11

hyubh wrote: »

Depends what way you look at it. If you literally lost all Rule of 85 protection, the countback for the actuarial reduction would start from 65 not 60. Paying an unreduced pension before it was originally possible to be paid out unreduced carries a cost to the pension fund, which needs to be made up somehow. Moreover, the same principle has always applied when calculating strain charges for employer-led early retirements (which are always unreduced according to scheme rules).

I look at it from my own perspective, which is not unreasonable. I can start my deferred LGPS pension at age 55, but with a 10 year (40.6%) reduction. Or wait until age 60 and take it unreduced, owing to Rule of 85 protection. As things stand, I'll be doing the latter.

hyubh

Johnnyboy11 wrote: »

I can start my deferred LGPS pension at age 55, but with a 10 year (40.6%) reduction.

No, 5 years, because you meet the 85 year rule at your original minimum retirement age of 60. You don't lose the original benefit of no actuarial reduction at 60, you just don't get it extended back to 55.

http://www.lgpsregs.org/schemeregs/tpregs2014/si2018-493.php#s2p1

AlanP_2

hogpog12 wrote: »

Interestingly, my BT defined benefit scheme gave me a much larger transfer value Vs annual pension than the LGPS are offering.

See Silvertabby's answer 8 above. BT is private so driven by market rates on investments.