in Pensions, annuities & retirement planning
15 replies 763 views
I stopped working 18 months ago aged 57 and have delayed taking my two db pensions, mostly with USS but 4 years NHS. I am living off capital and have budgeted so that I can do that for up to another three years. I got a forecast from USS when I stopped working and again last year and the increase seemed more than I could earn from investment. Am I doing the right thing or should I take my pensions now and invest my capital? I currently have half in a bank savings account and half in a s&s ISA. Of course this is all dependant on lifespan which nobody knows.
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Then take the whole lot out and pay no tax.
That is assuming you have no problem with triggering MPAA which will limit future DC contributions to £4,000/year (gross).
If you have no intention of working again MPAA shouldn't be an issue though.
What is the Normal Retirement Age for your pension? USS don’t give an actuarial increase to pensions that are deferred beyond NRA, but they do apply an early retirement factor if you take it before NRA.
from 61 to 60 and 11 months £30 reduction
to 60 and 10 months £440 reduction (not sure why there is such a big reduction here)
to 60 and 9 months £20 reduction
to 60 and 8 months £20 reduction
to 60 and 7 months £10 reduction
to 60 and 6 months £30 reduction
to 60 and 5 months £10 reduction
to 60 and 4 months £10 reduction
to 60 and 3 months £30 reduction
to 60 and 2 months £10 reduction
to 60 and 1 months £20 reduction
to 60 and 0 months £20 reduction
to 59 and 11 months £1,210 reduction (for this reason I would not take mine before I am 60)
These reduction are cumulative
I think this is mainly down to when the pension was final salary although pension age was 65 it was in our contracts that we could retire at 60 with no actuarial reduction.