Opting out lgps

Matt_22

QrizB said:

Currently, if you were 65, an annuity paying £1500pa and increasing annually by RPI would cost about £35k.

A couple of years ago the same annuity would have cost about £50k.

Thanks why would it of been 50k a few years ago?

QrizB

Matt_22 said:

QrizB said:

Currently, if you were 65, an annuity paying £1500pa and increasing annually by RPI would cost about £35k.

A couple of years ago the same annuity would have cost about £50k.

Thanks why would it of been 50k a few years ago?

Gilt yields were lower then.

Matt_22

Can you explain Gilt yeilds please

shortseller09

Thanks why would it of been 50k a few years ago?

It's not 'of' it's 'have', please...

Swipe

Matt_22 said:

Thanks so it seems like it's worth doing?

It's worth it, especially if you plan to leave within 2 years. After your transfer is completed you can leave whenever you like and not have to worry about transferring out or losing money by taking a refund which you would have to deal with otherwise.

Andy_L

Matt_22 said:

Can you explain Gilt yeilds please

https://www.dmo.gov.uk/responsibilities/gilt-market/about-gilts/

Matt_22

Universidad said:

Matt_22 said:

Thanks so it seems like it's worth doing?

Nobody wants to tell you that "you should do it" because there's a difference between offering people advice ABOUT their pensions and offering advice on WHAT TO DO with their pensions, and the second one is not a line most of us will cross.

But everybody IS saying "Well, I would do it" and "That looks like a really good deal". Read the room a little, my dude. You're in a forum where people generally know more than the average punter about pensions, and they're telling you this looks good. There isn't going to be a level of enthusiam significantly above that.

It's totally your choice, and either way you'll be better off than if you didn't have any pension yet!

Here's my advice, as it goes: there are two ways of looking at a pension. One is about maximising wealth. The other is more like a form of insurance - not having to worry about whether there is enough money in old age.

The LGPS is very, very much better at providing clarity on the second one of those points. It's a bit more variable with the first, could go either way. 

What do you want your pension to do?

Thanks yes I don't really have much knowledge on pensions but as people have said the lgps is a good one. I didn't have a clue whether there offer appears good or not. Hopefully my pension knowledge will improve over the years.

Matt_22

I am looking at transferring it though

Matt_22

I had a look how much an annuity of £1580 a year would cost and as you say it's around 35/40k.
My next question is, are the lgps offering my this amount as I am 35 and they believe they can grow the money to around that value. By the time I get to 65/68. Would they offer a similar annuity for £14000 is I was applying for the transfer in my 60s?

xylophone

You can leave your LGPS deferred in the Scheme if you leave and it will revalue in deferment and once it comes into payment.

https://www.lgpsmember.org/your-pension/thinking-of-leaving/leaving-before-retirement/deferred-benefits/