Is it best to retire at end March - financial viewpoint

TheBanker

Assuming I still work for the same company, I think I'll retire in June.

Wouldn't go before the end of March, because that's when our annual bonuses are paid. I could finish work in mid June but by then I'd have some accrued annual leave so could officially retire during July Seems a nice time to go while the weather's warm and the summer is waiting to be enjoyed. 

Teaandscones

you might want to consider making your retirement date mid April instead if you have a compulsory lump sum. The inflation will be taken care of whichever date you retire regarding the pension, but in the LGPS the increase in lump sum is once a year in the second week of April.

Ebeneezer9

Silvertabby said:

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.

22 03 27 is my actual retirement date. Payroll date is 26th. I’m not concerned about the payment dates, but I do appreciate your estimate, just wondered which tax year would be used by HMRC.  Thank you to all who replied.

george_jetson

Interesting discussion. I can “afford” to go at the end of November but after chatting to a couple of recently retired friends they both strongly advised hanging on until spring.

I’ve decided to do just that, thinking it’s pointless burning through cash savings just as the weather takes a turn for the worse. I know I could take cheap off peak trips for some winter sun, but I’d still have a lot of time on my hands in gloomy winter weather. 

Far better to grind on for a few more months, top up my savings pot and leave at the end of the financial year. I’ll then have time to get “the hang” of retirement before winter swings round again…

I can’t think of any financial factors that would make either option more advantageous- other than as mentioned a few extra months earning vs using savings 

BTW I will be retiring at 57 thanks to advice and knowledge gained from this board. I took out a DC pension a few years ago which allows me to bridge the gap until my DB pension at 60. So thanks to all those who answer questions here - it’s literally changed my life!

Pat38493

george_jetson said:

Interesting discussion. I can “afford” to go at the end of November but after chatting to a couple of recently retired friends they both strongly advised hanging on until spring.

I’ve decided to do just that, thinking it’s pointless burning through cash savings just as the weather takes a turn for the worse. I know I could take cheap off peak trips for some winter sun, but I’d still have a lot of time on my hands in gloomy winter weather. 

Far better to grind on for a few more months, top up my savings pot and leave at the end of the financial year. I’ll then have time to get “the hang” of retirement before winter swings round again…

I can’t think of any financial factors that would make either option more advantageous- other than as mentioned a few extra months earning vs using savings 

BTW I will be retiring at 57 thanks to advice and knowledge gained from this board. I took out a DC pension a few years ago which allows me to bridge the gap until my DB pension at 60. So thanks to all those who answer questions here - it’s literally changed my life!

Great to know you are almost ready to retire and that the experts on here helped you out.  I have learned a lot from them as well on this board in the last year.

One thought that occurred to me when reading your post was something that I also suffer from - thinking on the short term of what will happen in the first year of retirement.  If you are concerned you will have nothing to do in the winter, there could be a lot of winters ahead even if you skip the first one.  I am kind of thinking in the same way but also conscious I will need a plan for the following cold and dark periods.

george_jetson

I don’t think I’ll have a problem “filling the days” in winter - live in London so access to plenty of (free) museums, galleries etc. It’s just that I’ll have more options as we go into spring - can’t say I’ll be too fussed cycling or visiting places like Kew Gardens or Richmond Park when it’s freezing, pouring down and it gets dark mid afternoon…

I’m quite happy to grind on until the end of the financial year. Gives a boost to my savings, a couple of extra quid on my pension. And I may as well be at the office to save having the heating on at home…!

[Deleted User]

My plan is to go end of September in 3 or 4 years time.  I calculate the income tax paid for that period will cover the pension income for the remaining 6 months as cash will cover remaining budget.

On a non-financial aspect I drive quite a bit for work and going before the darker longer evenings is appealing.

I have no problem with finding things to do during the autumn and winter and I live in quite a rural location.