Transfer in to a Defined Benefit scheme 25 years ago

xylophone

I’m coming up for 57 and intend to retire within two years. 

You will be permitted to take your pension early with actuarial reduction? Normal Pension Age in the scheme is 65?

Dox

Fylde1 said:

Thank you very much, that is most helpful, and much appreciated. Yes, it is a private sector scheme. The only thing I am unclear about is why there are two pension figures given. I can’t imagine that my transfer-in would produce a pension of £11000 a year, so what is the relevance to me of that particular figure?

When you transferred in the cash from your old personal pension, it 'bought' you a fixed amount of pension in your defined benefit scheme: £2,226.06, payable from your scheme's normal retirement age, which you reach in 2028. The pension scheme administrator has given you a figure (clearly marked as 'for illustration only') based on the £2,226.06 going up each year from the time you transferred in to the time you take the pension, using an annual revaluation figure of 5%. Doing the sums, that's 33 years at 1.05 = 5.003. Multiply your £2,226.06 by 5.003, and you get £11,137.

Is that what you'll get if you retire in a couple of years? No, for two reasons: inflation has often been below 5%, so your pension won't have increased that much; and you are taking it before the scheme's normal retirement age.

Fylde1

xylophone said:

I’m coming up for 57 and intend to retire within two years. 

You will be permitted to take your pension early with actuarial reduction? Normal Pension Age in the scheme is 65?

Thanks xylophone, Yes, I can go from 55 with a reduction.