LGPS Pension question administered by the LPFA

1931modela

Is there a right or wrong time to start this pension i.e should I wait till after the 6th April 23 for any possible uplift due to inflation etc
I am presently still contributing and am past NRA

MX5huggy

Do you have any pre 2014/15 contributions? 

1931modela

MX5huggy said:

Do you have any pre 2014/15 contributions? 

Yes I started on 1st December 2009, so I have a final salary element and care

1931modela

Sorry to bring this to the top again, but I really would like to know if there is a good or bad to time to draw my LPFA pension, I would like it to start from the 1st May 2023 unless anyone suggests differently

hyubh

1931modela said:

Is there a right or wrong time to start this pension i.e should I wait till after the 6th April 23 for any possible uplift due to inflation etc
I am presently still contributing and am past NRA

The next pension increase date in the LGPS is 10th April. However the first pensions increase after leaving is pro-rated for the part year - so since you are not already a deferred member, drawing your pension either side of the increase date isn't going to make a material difference.

Maybe however you are thinking of active member revaluation of CARE pension. This year (and going forward) the revaluation date is moving from 1 April to 6th April, to align with Annual Allowance periods. However regardless of when you leave during the year, you are still due the revaluation to that date, when the revaluation date is itself hit. So again, no big deal whether you retire before or after 6th April.

1931modela

hyubh said:

1931modela said:

Is there a right or wrong time to start this pension i.e should I wait till after the 6th April 23 for any possible uplift due to inflation etc
I am presently still contributing and am past NRA

The next pension increase date in the LGPS is 10th April. However the first pensions increase after leaving is pro-rated for the part year - so since you are not already a deferred member, drawing your pension either side of the increase date isn't going to make a material difference.

Maybe however you are thinking of active member revaluation of CARE pension. This year (and going forward) the revaluation date is moving from 1 April to 6th April, to align with Annual Allowance periods. However regardless of when you leave during the year, you are still due the revaluation to that date, when the revaluation date is itself hit. So again, no big deal whether you retire before or after 6th April.

Many thanks for your reply, so just to clarify I will not see the 10.1% uplift in my pension if i stop work on the 30th April and commence my pension,
Sorry if that is a dumb question and I appreciate you responding to my earlier question

traceyaj

Sorry to hijack the thread but my question is on a similar vein. I have a deferred local government pension which consists of a lump sum and monthly payments. I will be 60 on 9th March 2024 and will look to take the pension at the best time after this date. The pro-rata bit confuses me and I basically need to know whether I would be better off waiting until after 10th April 2024 before making my move. Hopefully both the annual increase to the monthly sum and annual increase to the lump sum will come into play by then ? Can anyone clarify?   

hyubh

1931modela said:

hyubh said:

1931modela said:

Is there a right or wrong time to start this pension i.e should I wait till after the 6th April 23 for any possible uplift due to inflation etc
I am presently still contributing and am past NRA

The next pension increase date in the LGPS is 10th April. However the first pensions increase after leaving is pro-rated for the part year - so since you are not already a deferred member, drawing your pension either side of the increase date isn't going to make a material difference.

Maybe however you are thinking of active member revaluation of CARE pension. This year (and going forward) the revaluation date is moving from 1 April to 6th April, to align with Annual Allowance periods. However regardless of when you leave during the year, you are still due the revaluation to that date, when the revaluation date is itself hit. So again, no big deal whether you retire before or after 6th April.

Many thanks for your reply, so just to clarify I will not see the 10.1% uplift in my pension if i stop work on the 30th April and commence my pension,
Sorry if that is a dumb question and I appreciate you responding to my earlier question

You will get 10.1% revaluation of your CARE pension to 31 March inclusive, and this will be applied on 6th April (i.e. before leaving). You will not get a pension increase of 10.1% against your complete pension in payment on 1 May 2023.

hyubh

traceyaj said:

Sorry to hijack the thread but my question is on a similar vein. I have a deferred local government pension which consists of a lump sum and monthly payments. I will be 60 on 9th March 2024 and will look to take the pension at the best time after this date. The pro-rata bit confuses me and I basically need to know whether I would be better off waiting until after 10th April 2024 before making my move. Hopefully both the annual increase to the monthly sum and annual increase to the lump sum will come into play by then ? Can anyone clarify?   

Pension increases in public sector schemes start from after leaving not retiring (most private sector DB schemes, in contrast, have a separate concept of revaluation between leaving and retiring). So being a deferred member, the pro-rata of your first pension increase has already happened (unless you left less than a year ago or so), and your pension (whether you still defer it or chose to draw it) will get the 10.1% on 10th April regardless.

That said, in order to get the full 10.1% on your lump sum - and straight away - you will need to draw your pension on or after 10th April. If you drew it before, then your LGPS administrator should still in principle be doing a 'second bites' exercise later in the year to pay you a pro-rata lump sum increase for the missing bit. But given we're so close to the next increase date anyway, I'd hold on.

Should also note, for completeness: if you are intending to take additional lump sum by commutation (not a good idea unless you have a very good reason to, but hey, you might), then definitely hang on in order to commute against the increased pension in deferment. (The 'second bites' business only applies to the lump sum you get by default with pre-2008 membership.)