Frozen pct pension questions

daz378

Asking for a friend in work....7 years ago we broke off from the council  as carers...pensionwise that was no problem for me as lgps  carried on but other colleagues came from nhs...so their pct pension was frozen...we're offered to be moved on to lgps...but my colleague chose a stakeholder type going forward.....she  is 56 and and 29 years in when pension frozen....1st question   does the rule of 85 apply  here?   Should she claim 25% and  then   leave  the annual defined benefit amount until NPA....or claim 25%   and ongoing defined benefit from now....they have a mortgage   but  the endowment policy    fell short of covering their mortgage.....thanks

Silvertabby

In your friend's case, R85 does apply - but only in respect of her pre 2008 benefits.  New rules allow access to deferred (not frozen) LGPS benefits from age 55, but R85 is still linked to the old rules minimum age of 60.

Assuming she doesn't intend to draw her pension until 60, her pre 2008 pension will be paid without any early payment reductions.  2008 to 2014 pension will be reduced for early payment before 65, and 2014 to date of leaving benefits will be reduced for early payment before SPA.

If she intends to take her pension now, from 56, she will lose most of her R85 protections and the total reductions for early payment will be substantial.

She can't take her lump sum and leave the rest until NRA - it's all or nothing.

daz378

Oh didn't  realise ...it was all or nothing...thanks