What to do with very small LGPS pensions

Dragon_Lily

Hi
I'm in the process of trying to tidy up some deferred pensions before I retire and was wondering what to do about two very small LGPS deferred pensions.
One is an old final salary pension (1999) payable at 60 yrs and will be £73 pa with a lump sum of £220.  The other pension (CARE 2018) is payable at 65 yrs and will be £400 pa with no lump sum.  

Is it worth just keeping them or transferring them to my larger DC pot (£120K) via CETV, if it's possible.  I'm 58 and want to retire early at 60.  I'm still working and paying into a NEST pension.  Along with my DC pension I also have a third deferred LGPS pension payable at 60 yrs around £4000 pa with a £12,000 lump sum.   My husband retires this year at 65 yr and has 2 very good pensions.  We also have no mortgage and around £300K in savings and investments.

Thanks

xylophone

Do you have a CETV for both  small pensions?

Have you obtained a state pension forecast?  What exactly does it say?

https://www.gov.uk/check-state-pension

Dragon_Lily

No I haven't checked out CETV for the small pensions.  It is something I will be investigating.  I just wanted to know if it was worth doing.  I've checked my SP forecast which is £175.20 max.  I have 40 yrs NI contributions. (COPE £24 pwk) so all sorted

Dazed_and_C0nfused

Dragon_Lily said:

No I haven't checked out CETV for the small pensions.  It is something I will be investigating.  I just wanted to know if it was worth doing.  I've checked my SP forecast which is £175.20 max.  I have 40 yrs NI contributions. (COPE £24 pwk) so all sorted

Is the forecast £175.20 or is that what you have actually accrued to 5 April 2020?

Dragon_Lily

I can't remember exactly (I checked it last week) but I think it was accrued up to 5 April 2020

xylophone

 I cannot imagine that the CETV of either of the tiny deferred DB pensions would be greater than £30,000,  in which case  you would not be obliged to obtain the advice of a Pension Transfer Specialist before a transfer out.

That said, you might find that the DC Scheme would still not accept a transfer without advice.

Another option you might consider would be to explore the possibility outlined here

https://www.pensionsadvisoryservice.org.uk/content/publications-files/uploads/Taking_small_pensions_Detailed_SPOT008_V1.5.pdf

under the section entitled 

2a. Special Rules for Occupational Schemes only

xylophone

Incidentally, Silvertabby https://forums.moneysavingexpert.com/profile/Silvertabby is a retired LGPS administrator and might be able to comment - I wonder whether it would be possible to combine the deferred LGPS pensions and if so whether it would be to your benefit or not?

Silvertabby

Unfortunately, combining is a non starter as OP is not a current, contributing, member of the LGPS.  

The 'small pot' rules don't apply as the total  value of all of OP's LGPS benefits are way over the limit.

And a transfer out would have to be all or nothing.

Sorry to be the bearer of bad news, but OP's only options are either to take all 3 pensions at 60 (when the CARE pension would be reduced for early payment) or just take the 2 older pensions at 60 and leave the CARE one deferred until SPA.

Dragon_Lily

Hi Everyone
Thanks a lot for your helpful responses.   One of the options I was considering exploring was trying to add the CARE pension to the other 2 LGPS and taking them all at 60.  It seems the most straightforward option given how small they are.  I will contact the pension provider to see if this possible.  

xylophone

One of the options I was considering exploring was trying to add the CARE pension to the other 2 LGPS and taking them all at 60. 

From what Silvertabby has said, this would be possible provided that you were willing to accept the reduction she mentions.

Silvertabby

Dragon_Lily said:

Hi Everyone
Thanks a lot for your helpful responses.   One of the options I was considering exploring was trying to add the CARE pension to the other 2 LGPS and taking them all at 60.  It seems the most straightforward option given how small they are.  I will contact the pension provider to see if this possible.  

No need to actually add them all together (which can't be done anyway).  Just take the 3 separate pensions from 60.

Are these all with the same LGPS?  If they are, then likely that they were kept separate because it wasn't in your best interests to combine.

But note that if the little 1999 pension is held with a separate LGPS, then they may initially offer it to you as a one-off lump sum - but you aren't eligible to accept that because your total LGPS benefits are over the £30K limit.