Taking LGPS Early

dont_use_vistaprint

Do all LG’s penalise early retirement  / reduce pensions and lump sums in broadly the same way using the same percentages ? 

I found one area that publishes a table  online showing the percentage reduction in lump sum and pension for years 1-12 if taking early, this is very useful for decision making, 

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

Dazed_and_C0nfused

dont_use_vistaprint said:

Do all LG’s penalise early retirement  / reduce pensions and lump sums in broadly the same way using the same percentages ? 

I found one area that publishes a table  online showing the percentage reduction in lump sum and pension for years 1-12 if taking early, this is very useful for decision making, 

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

It is very rare for any DB pension to apply a penalty for taking the pension early.

There is usually a reduction to reflect the fact that you are asking for the pension to be paid for a longer period though.

Do you mean the reductions shown on this page, which seem ok for future planning purposes.

https://www.lgpsmember.org/your-pension/planning/taking-your-pension/

Marcon

dont_use_vistaprint said:

Do all LG’s penalise early retirement  / reduce pensions and lump sums in broadly the same way using the same percentages ? 

I found one area that publishes a table  online showing the percentage reduction in lump sum and pension for years 1-12 if taking early, this is very useful for decision making, 

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

The LGPS factors are clearly set out here: https://www.lgpsmember.org/your-pension/planning/taking-your-pension/

Aylesbury_Duck

dont_use_vistaprint said:

Do all LG’s penalise early retirement  / reduce pensions and lump sums in broadly the same way using the same percentages ? 

I found one area that publishes a table  online showing the percentage reduction in lump sum and pension for years 1-12 if taking early, this is very useful for decision making, 

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

It's not a penalty, it simply reflects taking money earlier.  Taking £15,800 p.a. from 62 instead of £20,000 p.a. from 67, for example, generates a similar overall sum if you live to 85 in either case.

Hoenir

dont_use_vistaprint said:

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

Probably because there's not the resource to deal with endless enquiries. When people are retiring and expecting their pension to be paid promptly. 

MX5huggy

You can’t do the calculations with accuracy for 12 years. The value of the pension will change, depending on the salary, CPI will revalue the pension each year etc. Just use the tables linked to do your best guess. 

dont_use_vistaprint

Dazed_and_C0nfused said:

dont_use_vistaprint said:

Do all LG’s penalise early retirement  / reduce pensions and lump sums in broadly the same way using the same percentages ? 

I found one area that publishes a table  online showing the percentage reduction in lump sum and pension for years 1-12 if taking early, this is very useful for decision making, 

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

It is very rare for any DB pension to apply a penalty for taking the pension early.

There is usually a reduction to reflect the fact that you are asking for the pension to be paid for a longer period though.

Do you mean the reductions shown on this page, which seem ok for future planning purposes.

https://www.lgpsmember.org/your-pension/planning/taking-your-pension/

Thanks - yes this is it.

The N/A figures against lump sump in years 11-13 does this mean no lump sum
is payable or that it is reduced by 15.5 % as for year 10.

it also says the employer can at its discretion decide not to reduce it , what would be typical grounds to request no reduction ?

Silvertabby

dont_use_vistaprint said:

Dazed_and_C0nfused said:

dont_use_vistaprint said:

Do all LG’s penalise early retirement  / reduce pensions and lump sums in broadly the same way using the same percentages ? 

I found one area that publishes a table  online showing the percentage reduction in lump sum and pension for years 1-12 if taking early, this is very useful for decision making, 

but my LG does not you have to request a specific date of retirement calculation , they take forever to respond and they won’t provide me all 12 figures to compare , you have to send 12 requests…

It is very rare for any DB pension to apply a penalty for taking the pension early.

There is usually a reduction to reflect the fact that you are asking for the pension to be paid for a longer period though.

Do you mean the reductions shown on this page, which seem ok for future planning purposes.

https://www.lgpsmember.org/your-pension/planning/taking-your-pension/

Thanks - yes this is it.

The N/A figures against lump sump in years 11-13 does this mean no lump sum
is payable or that it is reduced by 15.5 % as for year 10.

it also says the employer can at its discretion decide not to reduce it , what would be typical grounds to request no reduction ?

The NPA for pre 2008 accruals (both pension and automatic lump sum) is still 65, so 10 years of reductions are the maximum.  Less if any R85 protections apply.

It's always been an employer discretion to authorise no reduction.  At their great expense.  There are no typical grounds, although extreme compassionate grounds is the one that does spring to mind.

In my 20 years as a LGPS administrator, I only ever saw this discretion used once (on extreme compassionate grounds).

ADD.  NPA for 2008 to 2014 accruals also remains 65, with only post 2014/CARE benefits being linked to SPA.