To combine or not LGPS

Silvertabby

As the gap is less than 5 years, you could combine and keep your final salary link in respect of your pre 2014 accruals.  So, the big question is, is your current salary more or less than your old salary, plus cost of living increases since 2017?  

As you joined before October 2006 you will have some R85 protections in respect of your pre 2008 benefits.  Very roughly, based on whole years, you will meet R85 when you are 62.  But as you intend to work until 65/67 that won't really be an issue for you.

Don't fixate on the idea of  'losing' your tax free lump if you convert your old benefits to CARE - the accrual rate of CARE is much higher than the old pre 2008 rate, so you won't lose it - you'll just have the option of taking a higher pension instead.  Or giving up some of your higher accrual rate pension for tax free cash.

There is no right answer to this.  It's what works for you.  Can you ask for estimates based on what your old deferred pension would buy you if combined?  Will be easier to see what's what then.

hyubh

Silvertabby said:

Don't fixate on the idea of  'losing' your tax free lump if you convert your old benefits to CARE - the accrual rate of CARE is much higher than the old pre 2008 rate, so you won't lose it - you'll just have the option of taking a higher pension instead.

Surely if the gap is less than 5 years, then then it would be an aggregation and a final salary link re-established with like-for-like 80ths, 60ths and CARE accrual...? So an either/or situation, i.e. either the gap is < 5 years and it's a service aggregation, or > 5 years and a CARE transfer in...?

Silvertabby

hyubh said:

Silvertabby said:

Don't fixate on the idea of  'losing' your tax free lump if you convert your old benefits to CARE - the accrual rate of CARE is much higher than the old pre 2008 rate, so you won't lose it - you'll just have the option of taking a higher pension instead.

Surely if the gap is less than 5 years, then then it would be an aggregation and a final salary link re-established with like-for-like 80ths, 60ths and CARE accrual...? So an either/or situation, i.e. either the gap is < 5 years and it's a service aggregation, or > 5 years and a CARE transfer in...?

Going by what Lemon-drizzle ( current LGPS administrator) said - member has option of joining and keeping final salary link or converting to CARE.  

Not an option in my day, but things can and do change.

Lemon_dr1zzle

Apologies I’ve given the wrong information! Long day! I’ll ask for my post to be deleted.
There is no Care conversion. It’s just the movement of benefits like for like and then retain the FS link. 

Silvertabby

Lemon_dr1zzle said:

Apologies I’ve given the wrong information! Long day! I’ll ask for my post to be deleted.
There is no Care conversion. It’s just the movement of benefits like for like and then retain the FS link. 

Wondered why I couldn't find that option! Happens to us all.

Lemon_dr1zzle

Silvertabby said:

Lemon_dr1zzle said:

Apologies I’ve given the wrong information! Long day! I’ll ask for my post to be deleted.
There is no Care conversion. It’s just the movement of benefits like for like and then retain the FS link. 

Wondered why I couldn't find that option! Happens to us all.

Ironically I had spent all day doing these sorts of cases 🤪

B1ff5361

Hi, just jumping on this thread as a point was made in a previous post about CPI on previous pension pots. I’ve moved to a different district council, but within the same county, so my previous 24 years of contributions have been deferred, with an option to combine them into my new / current pension. My query though is that I took a pay cut of around 8% in moving jobs, and I’ll be at my NPA in 5 years. Given I’m only going to get the annual increment on my current salary, am I better off not combining them, and keeping my deferred pension separate? Thanks 

Kernowshep

B1ff5361 said:

Given I’m only going to get the annual increment on my current salary, am I better off not combining them, and keeping my deferred pension separate? Thanks 

Probably, unless you get made redundant.

B1ff5361

Kernowshep said:

B1ff5361 said:

Given I’m only going to get the annual increment on my current salary, am I better off not combining them, and keeping my deferred pension separate? Thanks 

Probably, unless you get made redundant.

Thanks, not sure about your redundancy point though? I’ve got continuous service so presumably it’d be based on length of service and my salary at the time? Given I’m at a district that will likely become combined in the next couple of years it’s something I’d like to understand!

Sarahspangles

It’s in the small print, your combined pension could pay out unreduced if you’re close to NRA