USS - General discussion

Cobbler_tone

Barralad77 said:

Re. Point 1. The closest you might get to the numbers if deferring is to use the calculator to see what they would be at the point of finishing work (the point at which contributions cease, which I think you said would be at 55) then model what they would be each year after that by (a) using the slightly better early retirement factor each time and (b) increasing the starting reduced AP by a nominal CPI figure (e.g., 2.5%) annually.

I understand and looked at the live model with the OH which makes sense.
The issue we have is that she takes her VS at 54, so will have a year of no contributions before she is 55. The model (understandably) assumes she will be working from 54-55. I have looked at her position now with the reduction factor but even then she is working another 10 months so it will increase.
We don't need to be that scientific at this point, it was purely to understand the mechanics. Based on what I understand there will be no rush to put it into payment for a while.

Cobbler_tone

Quick question.
I have mapped out the logical order for my partner to access her funds next year, retiring at 54.
Year 1 funded by VS. She has two DB's and the investment builder which will have c.£50k in.

2026/27 funded by VS
2027/28, 28/29 and 29/30 it makes sense to run down the IB in the most efficient way...probably taking the DB's in 2028 at age 58. It will give her what she needs, without needlessly kicking the DB's in too early.

Does the investment builder allow withdrawal to maximise the tax code using UFPLS if you have no other income, or does the pot need transferring to a product that allow this?

swindiff

You are allowed 4 x UFPLS withdraws per year, free of charge as long as they are at least £2000

https://www.uss.co.uk/for-members/thinking-about-your-future/using-your-investment-builder-pot

Cobbler_tone

swindiff said:

You are allowed 4 x UFPLS withdraws per year, free of charge as long as they are at least £2000

https://www.uss.co.uk/for-members/thinking-about-your-future/using-your-investment-builder-pot

Thank you, it was a lazy question and I was on my phone at the time but there is clearly some good info available.
Sounds like an adequate product for what she will use it for.

guymo

Related to the above, can I just check whether the following is possible:
 - take retirement earlier than NPA
 - take some UFPLS withdrawals for a few years, without accessing any DB benefits, to pay the bills while reducing the impact of ERFs on the DB part
 - when taking DB benefits, make use of the commutation of some remaining DC funds to maximise the tax-free lump sum to 6.66 x pension income as discussed elsewhere in the thread?

(I understand that 25% of any UFPLS taken will count towards the lump-sum allowance.) 

Thanks in advance.

PJM_62

Not sure if your last point is correct. 
25% of ufpls is tax free but it's not a tfls. 

Rest sounds doable. But don't assume taking DB early results in a big overall loss. The erf isnt meant to be punitive.
Do the calcs / get a quote to compare totals when taking early and deferring.

ussdave

I thought you couldn't access any IB funds without also accessing RB (without transferring out, at least)?

PJM_62

https://www.uss.co.uk/for-members/thinking-about-your-future/using-your-investment-builder-pot

ussdave

PJM_62 said:

https://www.uss.co.uk/for-members/thinking-about-your-future/using-your-investment-builder-pot

I'm not sure how I've missed that all this time.  Thank you for enlightening me.

Barralad77

You’ll need to check with USS (or someone on here may be able to clarify) but you might not be able to take 6.67 x pension as a TFLS if you’ve already accessed the IB. My memory could well be failing me here, but I seem to recall a previous discussion where it was concluded that the 6.67 multiplier was a ‘one-time only’ opportunity if you take DB and IB together (the inference being that if you’ve drawn from the IB before taking DB then when taking the DB you will get a 3 x pension TFLS and anything taken from the IB will have 25% tax exemption only).