LGPS pensions

Paddleboarder

I can anyone  please help with a pension query? I was 60 and end of April this year , I have been paying into LGPS pension since I joined Nov 1996. I would like to retire ASAP & hope to take early retirementretirement under 85 year rule. Firstly I have been given two dates for this one is my 61 st birthday next April 2021, the other is Nov 2021 anniversary of my joining so I am not sure which is correct?
Secondly it is a very small pension 4,000 a year taking max lump sum of 26000, my salary is currently 22000. Is it wise to retire early, will I lose to much? Would it be beneficial to retire but defer payments until I am 66 when it will be paid out?I I obviously can't live on it, so will either get another small part time job or I can live off rental from an inherited property so although it would be nice to receive it next year I could survive with out it until I am 66.
Any help gratefully received. Thank you. 

daveyjp

You can't retire and defer a LGPS pension.

Have you thought about half way house and go on semi retirement for 5 years?  You retire, take your pension and then go back on a new contract for fewer days.

Paddleboarder

Thank you for your reply. I sadly don't think they will allow me to come back,due to cutbacks I am sure once I have gone that's it. 

daveyjp

If they a cutting bsck you need to hold on for redundancy, or apply for voluntary redundancy.

Don't miss out on a potential pay off!

hyubh

daveyjp said:

You can't retire and defer a LGPS pension.

What do you mean...? You can leave pensionable employment and not draw the pension.

daveyjp

Leaving pensionable employment isn't retiring, which was the question the OP wanted an answer to.

Once you retire from Local Government you are paid your pension.

hyubh

daveyjp said:

Once you retire from Local Government you are paid your pension.

In a tautological sense, yes. But there is no requirement to draw your pension if you leave pensionable employment at NPA (or latest NPA if more than one) to retire with other savings. Only exception (since the 2014 regs) is for employer-led early retirements, which isn't the case here. 

ouraggie

It may have changed but OH was told by our local LGPS office that you CAN defer a LGP even after retirement age and it is increased by a tiny % for each week you don't draw it. He will do this as he becomes eligible for his pension in Feb but he will defer it till April as for  various reasons he will be better off not paying any tax during this tax year).

Paddleboarder

Thank you for your comments, defering from age 61 until 66  I think would be my last resort . My main concern isif I retire early ie next year under 85 year rule, will I loose out so much on an already very small pension which  I have worked 24 years for .
I do not feel I want to lose out so much & not being great with the figures, I find it hard to work out the figures, as to how much I will lose over 5 years against  taking the pension early. Also taking into account what I would have to continue to pay ie.  the pension, Nat Ins, tax etc. my travel costs which are £200 a month. 

enthusiasticsaver

The LGPS has a web portal which works the figures out for you or my LGPS did.  I retired and drew my LGPS at 58 although my retirement age was 66 so 8 years early.  I could have deferred it and it would have been 20% more but given my LGPS was relatively small (£5k) anyway and taking it before my other deferred pension and state pension kicked in was more tax advantageous.  Mine was complicated too though as I transferred an old pension into it and paid extra for added years. The formula is more complicated under the rule of 85 but as I say the portal will calculate it for you. There will be an actuarial reduction if you take it 5 years early but it may not be as much as you think. 

enthusiasticsaver

Paddleboarder said:

Thank you for your reply. I sadly don't think they will allow me to come back, due to cutbacks I am sure once I have gone that's it. 

Any chance for redundancy if they are making cutbacks?  Sometimes  there are incentives to people to retire early if they are making cutbacks by offering the pension without actuarial reductions.  I tried for that but unfortunately my job was not at risk of disappearing but you may be lucky.