local govt pension scheme - what % of salary to put in ? 30 August 2021 at 12:13PM in Over 50s MoneySaving 7 replies 283 views

PaulBrighton2021

is approx 6% of gross salary enough, with 10-12 years left to the big R..? 

 single, no family, renting my place. have some frozen pension pots, from previous private sector jobs..

QrizB

Probably not but it really depends on exactly what existing pension provision you have and what level of retirement income you're hoping to have. Someone who's happy on £800/month will have much different needs than someone who wants £4000/month.

Also, check your state pension forecast: https://www.gov.uk/check-state-pension

Post your numbers here for us to pore over

GunJack

If it's LGPS you're in a Defined Benefit scheme, not building a pot of money. The contributions are to be in the scheme..

blue.peter

GunJack said:

If it's LGPS you're in a Defined Benefit scheme, not building a pot of money. The contributions are to be in the scheme..

But presumably it has an AVC facility that would allow member to pay more than the minimum?

QrizB

This thread might be better in the "pensions" section, it gets more traffic from pensions people than this one does!

https://forums.moneysavingexpert.com/categories/pensions-annuities-retirement-planning

Nebulous2

The starting point is when you want to retire, and how much you need / want to live on. 

Retiring at state pension  age means you will have a starting point of over £9000 at todays rates if you have a full pension. Your local government scheme simply needs to top that up. 

Retiring before that means you have to fund all your requirements from savings, pensions etc until your state pension kicks in. If you can afford it increasing your payments through AVCs, or funding a separate SIPP will increase your options to have more in retirement, or to stop work sooner. 

GunJack

blue.peter said:

GunJack said:

If it's LGPS you're in a Defined Benefit scheme, not building a pot of money. The contributions are to be in the scheme..

But presumably it has an AVC facility that would allow member to pay more than the minimum?

It does, but the AVC is not effecting the core benefit as such, but it could be used to generate the PCLS without affecting the annual pension amount. I'm not a LGPS expert, so try asking @Silvertabby who's a retired LGPS administrator

Silvertabby

Do you intend working until SPA?  When did you join the LGPS?

There are 2 ways of paying more :

Buying additional pension.  Good value if you intend to work until SPA, not so much if you want to retire at 55 because of the early retirement reductions.

In-house AVCs.  Most popular for those who want to maximise their tax free cash (within HMRC limits) without commuting (giving up) some of their pension.  Get it right, and it'll all be tax relief in, tax free out.  However, not a problem if you go over the limit - the excess AVC fund can be used to purchase additional LGPS pension at very favourable rates.