Early retirement and bridge to state pension

Ewymac56

Retiring early age 56 I have a Teachers AVC pot £136000. Teachers DB £12000 p/yr (£36000 Ls) Buy to let £4800 profit p/yr.  Sitting on larger property with equity £250000. Rental valuation circa £1900/Mth. Plan to swap accommodation down the line.
Need to know how best to bridge gap to State pension. Is £20000 (index linked 2%) income possible and still have 30 years of income.
Prudential retirement plan. Is it a decent product? AVC already held in pru with profit fund. Transfer straightforward?  would it be cheaper than moving pot elsewhere?
Would be interested to know what your views are?

Dazed_and_C0nfused

Either your post is confusing or you only need to find £3.2k/year for 11 years so even with growth which only covered fees the AVC pot would still be c£100k when you started getting your State Retirement pension.

Have you checked your State Pension forecast (reading past the headline) to see what you might need to pay voluntarily over the next few years to reach £175.20?

Ewymac56

Dazed_and_C0nfused said:

Either your post is confusing or you only need to find £3.2k/year for 11 years so even with growth which only covered fees the AVC pot would still be c£100k when you started getting your State Retirement pension.

Have you checked your State Pension forecast (reading past the headline) to see what you might need to pay voluntarily over the next few years to reach £175.20?

Thank you for taking time to read and comment! It is a confusing post! You are quite right it is only £3.2k and I am a bit thick!! 😀  I have realised I could set my income sights a bit higher to enjoy the early years of retirement and slow down as I get get older. 
I missed several years of state pension contributions whilst at Uny and travelling abroad. Consequently £157 per week. 
Prudential won’t move funds until I have taken advice. I am a bit nervous about trusting an IFA without a reliable referral. Union recommends The Lighthouse group. Not sure how independent they are and how costly? Won’t hurt to have a free 1st meeting.

Dazed_and_C0nfused

Almost certainly the best (low risk) investment you could make is to pay either 3 or 4 years voluntary National Insurance contributions to take you to £175.

If you have been working in this tax year you may have accrued another year to take you to £162 leaving just another 3 to reach £175.

The simplest option is to pay c£2.3k (in total) in Class 3 voluntary contributions for 3 extra years.

Or start a small business and pay c£500 (in total) in Class 2 voluntary contributions for 3 extra years.

Those extra 3 years will give you £13/week pre tax or £540/year after 20% tax so you will soon recoup the cost of the voluntary NI.

Ewymac56

Dazed_and_C0nfused said:

The simplest option is to pay c£2.3k (in total) in Class 3 voluntary contributions for 3 extra years.

Or start a small business and pay c£500 (in total) in Class 2 voluntary contributions for 3 extra years.

Those extra 3 years will give you £13/week pre tax or £540/year after 20% tax so you will soon recoup the cost of the voluntary NI.

Whole and part years missed contributions from 1987-97! Is there a 6 yr rule preventing me from voluntarily contributing?

Linton

Ewymac56 said:

Dazed_and_C0nfused said:

The simplest option is to pay c£2.3k (in total) in Class 3 voluntary contributions for 3 extra years.

Or start a small business and pay c£500 (in total) in Class 2 voluntary contributions for 3 extra years.

Those extra 3 years will give you £13/week pre tax or £540/year after 20% tax so you will soon recoup the cost of the voluntary NI.

Whole and part years missed contributions from 1987-97! Is there a 6 yr rule preventing me from voluntarily contributing?

You cannot go back for more than 6 years.  But you can usefully pay voluntary NI for the extra years you need between now and the end of the tax year before you reach State Pension Age - you do not need to be working.   

Dazed_and_C0nfused

They won't necessarily increase your forecast even if you could pay them.

It might be worth a read of the excellent Royal London guide to topping up your State Pension to see if you might be able to improve things with pre 2016 contributions.

xylophone

What exactly does your state pension forecast say?
https://www.gov.uk/check-state-pension
How many qualifying years did you have at 6/4/16?
What is your COPE?

xylophone

Royal London guide

https://www.royallondon.com/siteassets/site-docs/media-centre/good-with-your-money-guides/topping-up-your-state-pension-guide.pdf

AlanP_2

Ewymac56 said:

Dazed_and_C0nfused said:

Either your post is confusing or you only need to find £3.2k/year for 11 years so even with growth which only covered fees the AVC pot would still be c£100k when you started getting your State Retirement pension.

Have you checked your State Pension forecast (reading past the headline) to see what you might need to pay voluntarily over the next few years to reach £175.20?

Thank you for taking time to read and comment! It is a confusing post! You are quite right it is only £3.2k and I am a bit thick!! 😀  I have realised I could set my income sights a bit higher to enjoy the early years of retirement and slow down as I get get older. 
I missed several years of state pension contributions whilst at Uny and travelling abroad. Consequently £157 per week. 
Prudential won’t move funds until I have taken advice. I am a bit nervous about trusting an IFA without a reliable referral. Union recommends The Lighthouse group. Not sure how independent they are and how costly? Won’t hurt to have a free 1st meeting.

Why are the Pru saying you need advice to move the AVC pot - are there special benefits as part of the scheme?

Albermarle

AlanP_2 said:

Ewymac56 said:

Dazed_and_C0nfused said:

Either your post is confusing or you only need to find £3.2k/year for 11 years so even with growth which only covered fees the AVC pot would still be c£100k when you started getting your State Retirement pension.

Have you checked your State Pension forecast (reading past the headline) to see what you might need to pay voluntarily over the next few years to reach £175.20?

Thank you for taking time to read and comment! It is a confusing post! You are quite right it is only £3.2k and I am a bit thick!! 😀  I have realised I could set my income sights a bit higher to enjoy the early years of retirement and slow down as I get get older. 
I missed several years of state pension contributions whilst at Uny and travelling abroad. Consequently £157 per week. 
Prudential won’t move funds until I have taken advice. I am a bit nervous about trusting an IFA without a reliable referral. Union recommends The Lighthouse group. Not sure how independent they are and how costly? Won’t hurt to have a free 1st meeting.

Why are the Pru saying you need advice to move the AVC pot - are there special benefits as part of the scheme?

I think the Pru are one of those providers who prefer to work via financial advisors .
Looked at the Lighthouse website - offering wealth management and retirement solutions - sounds expensive and they are owned by Quilter so presumably only offer their investment products.