Is it best to retire at end March - financial viewpoint

Steve_666_

I would suggest the "other" factors would normally drive the retirement date, not tax. For me, I'm planning to finish in synchronization with the share options cycle as they are funded from the monthly salary.

IdrisJazz

Leaving financial matters aside, I would have a strong preference for retiring in spring - when I would approach the empty days with enthusiasm. I suppose I could do autumn/winter if we were planning to get an exciting winter break somewhere.

Financially, I am planning to take my modest DB pension at age 65, and my birthday is in late July. If retiring in spring when I'm 64 means lower benefits, it might make me wait - depending on savings position and whether I've had an inheritance by then or not.

RogerPensionGuy

Just an observation on this good thread. 

IMHO too many organisations and people hard link up stopping paid employment and drawing pensions or various financial vehicles. 

I have and continue to hold the views paid employment and cashing in financial vehicles like pensions or similar are essential completely independent from a time and date point of view.

Over the years I considered overlapping pensions and paid employment by many years or even taking no coins or maybe just the personal allowance of £12,570 PA for a few of more years. 

I just think paid employment and pensions should not be hard linked.

Sarahspangles

RogerPensionGuy said:

I just think paid employment and pensions should not be hard linked.

Absolutely - I have a year’s living expenses saved for easy access in case I have/want a gap between contracts (which is my preferred employment model). I had a lightbulb moment that when I decided to retire I could run through that first, as when I start my first db pension I get a PCLS which replenishes it straight away.

eastcorkram

IdrisJazz said:

Leaving financial matters aside, I would have a strong preference for retiring in spring - when I would approach the empty days with enthusiasm. I suppose I could do autumn/winter if we were planning to get an exciting winter break somewhere.

Financially, I am planning to take my modest DB pension at age 65, and my birthday is in late July. If retiring in spring when I'm 64 means lower benefits, it might make me wait - depending on savings position and whether I've had an inheritance by then or not.

I think I might go the other way, and finish just heading into winter. Then I won't be scraping ice off the car at 3.30am. 

Ebeneezer9

My retirement date is 22 03 2027, I intend to take TFLS from AVC and start drawing my LGPS pension on this date so I assume that by the time I am in receipt of any money it will correspond to the tax year 2027/28. Am I correct in assuming this?

ukdw

For me it worked really well - as my Birthday is in March. 

I stopped work a few years before age 55 and lived off savings (plus for the last couple of months before being able to access my DC interest free credit cards) - so when I hit 55 in March I was able to activate my DC pension and drawdown a whole years worth of unused basic rate tax allowance in one go. 

Then only another month later when the tax year flipped over I had another fresh years worth of tax allowance available to start drawing down against.

Sarahspangles

Ebeneezer9 said:

My retirement date is 22 03 2027, I intend to take TFLS from AVC and start drawing my LGPS pension on this date so I assume that by the time I am in receipt of any money it will correspond to the tax year 2027/28. Am I correct in assuming this?

I don’t think you can count on it falling into the later tax year, maybe if we summon  @Silvertabby she would know.

sheslookinhot

Ebeneezer9 said:

My retirement date is 22 03 2027, I intend to take TFLS from AVC and start drawing my LGPS pension on this date so I assume that by the time I am in receipt of any money it will correspond to the tax year 2027/28. Am I correct in assuming this?

Never assume what will happen. Best ask the provider. 

When is “payroll” date in the month ?

When do you actually want the first payment to reach your bank account ?

Though it can take many weeks, even a month or two, before the pension administrator arranges the first payment.

Silvertabby

Ebeneezer9 said:

My retirement date is 22 03 2027, I intend to take TFLS from AVC and start drawing my LGPS pension on this date so I assume that by the time I am in receipt of any money it will correspond to the tax year 2027/28. Am I correct in assuming this?

Is this your actual date of retirement, or the date you intend taking deferred benefits?

If the former, then I used to suggest that if speed of payment is an issue, then AVC payments should be ceased at least  a full month before retirement.  This gives your AVC provider a little extra time to register the last payment, then disinvest the funds.

Your LGPS will also have to wait for your final pay details, which won't be generated until after payroll has been put to bed.  First week in April, if you are lucky.

If you are retiring on 22 March (ie, not deferred) then possible pension payments dates would be:

31 March.  No way.
30 April.  Pushing it
30 June.  Possible, as long as your LGPS has your final pay details and the disinvested AVC funds.

If you are accessing your benefits from deferred, then 30 April is possible, but all depends on payment of AVC funds.