LGPS, Rule of 85 and decisions to make

Wimbrel

In my case, the flexi retirement salary plus pension would indeed exceed the original full-time salary, even if I dropped to 18.5 hours.  So if this is an issue I shall continue paying in and working full time for another few years. Thanks for the advice, much appreciated

k6chris

Wimbrel said:

I've been paying into the LGPS pension scheme since 1985, it started out as final salary but then changed in 2014 to career average and the final salary part of the pension is protected to that date.
I  reach 60 later this year but intend to keep working for another 3-4 years. 
However, the pensions calculator on the LGPS site seems to show that I could start drawing my pension and take a lump sum at age 60 and that the protected element and rule of 85 mean that this would be financially advantageous as the additional years of pension outweigh the amount which would accrue were I to continue paying in.
I have requested a formal calculation from the scheme and won't make any decisions without seeking advice
I realise that there would be tax implications as even if I took the maximum lump sum by sacrificing annual pension payments, the pension plus my salary would take me into the higher tax band, but, on my back of envelope calculations, it looks too advantageous to be true.

Further info, this is a contracted-out scheme so when I reach state pension age at 67 I will not get a full state pension. I will need to be sure that when I actually retire and my income drops to the pension alone, that the books will still balance but I would be able to save additional money on top of the lump sum to ensure that I should be OK.

What am I missing? There must surely be drawbacks, and serious ones at that, that I need to consider.

This may be a dumb question, but do you know how much money you need / want when you retire?  Until you know that, other questions are difficult.

Wimbrel

Not a dumb question at all. Yes, I know what I will need to cover expenses and live a bit and am in the fortunate position that I've been paying into a good pension scheme since the 1980s and earn a respectable, (though not anywhere close to higher tax band level) salary. Pension projections and other arrangements mean that I will be able to retire comfortably, though not luxuriously, any time from my 60th birthday onwards.