LGPS Lump Sum payment do I have to take it ?

Tiggy777

Silvertabby wrote: »

Yes, but there are a tiny number of members (and I really do mean tiny) who have retained reserved rights to inverse commutation. The rules are really complex and may differ from LGPS (interpretation) to LGPS, so only Tiggy's LGPS provider will be able to say if they apply to her.

So are so few eligible members that when the software was updated the calculation for inverse commutation was removed, meaning that it now has to be done manually. The LGPS I worked for would just give the normal options of standard/maximum lump sum, but would say that inverse commutation was an option, and that details would be supplied on written request. Then we'd cross our fingers. During my time, only two members asked for further details - and only one of these actually went for the inverse commutation.

Many thanks for all the advice.

I started paying in back in 1980 and have things like the 85 year role protection so most of my funds are protected with a retirement age of 60 in terms of applying percentage reductions if I take early.

Many thanks once again

Tiggy

pandora205

I made enquiries about reverse commutation (I've contributed since I joined in 1981 plus transferred in from TPS) but wasn't eligible, so I think it is quite rare. I do have a quote for purchasing additional LGPS pension on retirement though which is a possibility, though I'll probably use my AVCs in other ways.

hyubh

Silvertabby wrote: »

Yes, but there are a tiny number of members (and I really do mean tiny) who have retained reserved rights to inverse commutation. The rules are really complex and may differ from LGPS (interpretation) to LGPS, so only Tiggy's LGPS provider will be able to say if they apply to her.

Hmm, I you referring to this?

Regulation 58 of the LGPS Regulations 1997 provided an opportunity for members to convert a lump sum benefit into pension (‘inverse commutation’) and regulation 59 provided an opportunity for “Class C” members to convert pension into lump sum under the more favourable terms offered by regulation 59 (i.e. more favourable than the 12:1 commutation rate). Those regulations were revoked as from 6 April 2006 by the LGPS (Amendment) Regulations 2006 [SI 2006/966]. However a deferred member as at 5 April 2006 could opt out of the effect of the deletion of regulations 58 and 59 provided he/she did so before 1 April 2007. There are some deferred pensioners who did so and to whom regulations 58 and 59 of the 1997 Regulations still apply.

http://lgpslibrary.org/assets/bulletins/2012/94.pdf

Silvertabby

hyubh wrote: »

Hmm, I you referring to this?



http://lgpslibrary.org/assets/bulletins/2012/94.pdf

Yes - deferred having opted for old rules, including those who later re-joined having opted not to combine records. Subject to LGPS discretions/interpretations - and very rare.

Happier_Me

I'm a long standing member of the LGPS so by no means an expert but...

Would there be some benefit in retiring at 57 but deferring your pension to 60 to take advantage of your 85 rule protection therefore getting a higher annual pension. And using your AVC pot to live on between 57 and 60? Would this option be financially beneficial?

Johnnyboy11

Happier_Me wrote: »

I'm a long standing member of the LGPS so by no means an expert but...

Would there be some benefit in retiring at 57 but deferring your pension to 60 to take advantage of your 85 rule protection therefore getting a higher annual pension. And using your AVC pot to live on between 57 and 60? Would this option be financially beneficial?

Assuming you met R85 criteria when you retired at age 57, then I think your protections still kick in from age 60. So your actuarial reduction would be 3 years (age 57 to 60), rather than the 8 years to normal retirement age of 65.