What to do with a deferred (I am no longer a contributing member) LGPS pension

What_time_is_it

I have a small (c.£1,250 DB a year, plus c.£3k lump sum) deferred LGPS pension from when I worked in a post-92 University about 12 years ago. I am now 47 years old and currently contributing to a USS pension, to which I make overpayments each month too.

What's the best thing to do with my LGPS pension? I'm inclined to leave it where it is and then claim it at the earliest possible time (currently 55 I believe?) but I don't think I have all the information to be able to make a fully informed decision.

Can I make overpayments/AVCs to my LGPS?
Is it worth combining it with my USS pension?
Anything else I could consider to make the most out of it?

Dazed_and_C0nfused

You won't be able to contribute to LGPS unless a current member of the scheme.

Not sure about AVC's linked to LGPS but I strongly suspect the same applies.

Why do you think taking it at the earliest possible time would be worthwhile considering?

Is giving up say 50% of your £1,250/year worth it to have the reduced pension paid for an extra 12/13 years? 

Southend_2

AIUI transfers to USS are now only accepted into the DC section so I would imagine you're better off leaving it where it is.

billy2shots

My wife has a similar value in a deferred LGPS.

We will do the maths when she's old enough to take it, 44 currently, whether to take early or not. It comes down to a life expectancy guess. 

What_time_is_it

Dazed_and_C0nfused said:

You won't be able to contribute to LGPS unless a current member of the scheme.

Not sure about AVC's linked to LGPS but I strongly suspect the same applies.

Why do you think taking it at the earliest possible time would be worthwhile considering?

Is giving up say 50% of your £1,250/year worth it to have the reduced pension paid for an extra 12/13 years? 

Thanks. I suspect you are correct on the AVCs. 

Regarding taking it at the earliest possible time, it seems to make financial sense to take it as early as possible. I think it's something like 55-60% if I took it from age 55. Even assuming 50%, it would only start to cost me money from when I am in my '80s. And by that time I would imagine that my outgoings will be lower than when I am in my '50s and 60's. Seems like a decent option to me, but I am open to other opinions on this of course.

What_time_is_it

Southend_2 said:

AIUI transfers to USS are now only accepted into the DC section so I would imagine you're better off leaving it where it is.

That is a good point. Probably best to keep it in the DB LGPS.

Silvertabby

Confirmed that you can't pay into a LGPS AVC once you cease to be a contributing member.

As you left before 1April 2014 your NRA is 65, not SPA.  This won't change, although you may not be able to access your pension before 57.

What_time_is_it

Thanks @Silvertabby

Can you see any disadvantage in me keeping my LGPS as a deferred pension and then claiming it at the earliest opportunity? (Long life would be a blessing, so happy to lose a bit of income in my mid-80s if I make it that far!)

sgx2000

LGPS's 
You will not find a better pension
Leave it where it is until it can be drawn

Dazed_and_C0nfused

sgx2000 said:

LGPS's 
You will not find a better pension
Leave it where it is until it can be drawn

That's the thing, it can be drawn at 55 (or maybe 57) but whether that is the best course of action is another matter.

Silvertabby

What_time_is_it said:

Thanks @Silvertabby

Can you see any disadvantage in me keeping my LGPS as a deferred pension and then claiming it at the earliest opportunity? (Long life would be a blessing, so happy to lose a bit of income in my mid-80s if I make it that far!)

It's very much a personal choice.  What I will say, is that when you do take your pension you will be offered a further option - that of maximum commutation.  ie, an additional £12 of tax free cash in return for £1 of annual index linked pension.  This commutation rate of 1:12 is already p. poor value, and on top of an 8 (?) year reduction for early payment would result in a major wipe out of your annual pension.  Choose wisely.