Two USS paths, cannot decide

NTFI19081

I am in USS and 56, essentially I have a choice.

1. Stay until 60, 3 days per week, and get USS pension of 31k + x3 TFLS at 60. Will have IB/DC's of 500k. 

2. Go now and take 24k USS + x3 TFLS. Will have 500k IB/DC at 60, if I leave invested.

All todays money.

The extra USS under path 1 is essentially due to staying and not triggering ERFs for the tranches that are not reduced if I retire with employer permission at 60.

I know this stuff inside out and have accounted for all the details. Can't decide though. If I go, I guess I could draw DC earlier if I take path 2. But more likely to work a little to supplement pension.

Essentially I am torn between the extra USS at 60 and the 'freedom' now. Any thoughts to clear the fog helpful!

DRS1

So if you take path 2 but cannot find any other work what will you do with yourself?  Have you prepared for "doing nothing" in retirement.  Do you have plans for your day?  Or do you need the next 4 years working 3 days a week to prepare you for whatever comes next?

And a basic question is £24k enough to live on?  Is £31k enough to live on?

NTFI19081

DRS1 said:

So if you take path 2 but cannot find any other work what will you do with yourself?  Have you prepared for "doing nothing" in retirement.  Do you have plans for your day?  Or do you need the next 4 years working 3 days a week to prepare you for whatever comes next?

And a basic question is £24k enough to live on?  Is £31k enough to live on?

I have plenty to do !  Too many plans. The main issue is the USS I am giving up, not the ability to fund lifestyle until 60 - as I have some PT work. The dc will draw from 60 at 4% as well. Full state pension. As I say the only issue I cannot decide on is whether to hang on for the extra USS DB pension. I suppose its a question of when I would 'break even' by waiting v going now

DRS1

I am not really sure the break even point should be your main concern.  Would it make a difference if it was 77 or 82?  Yes you may want to extract the most you can from the USS but by the time you achieve that (using path 1 if that is the result) you will probably be past caring

Think about what you want to do now and can you afford to do it.  It sounds like £24k is too little if you need PT work to tide you over.  But if you go with path 1 are you doing something you don't want to do (sounds like it) for 4 years when you could be doing something else you much prefer.  Or maybe path 1 is bearable if the something else will fit in the 4 days a week you won't be working (except that PT work will probably intrude into those 4 days).

singhini

🧮 1. First, what’s the real financial difference?

It sounds like you’ve already calculated that the main difference between Option 1 and Option 2 is:

• Option 1: Higher USS at 60 because you avoid ERFs on parts of your pension by staying to age 60 with employer consent.

• Option 2: Lower USS at 60, but you gain time and possibly the ability to draw from DC earlier if needed, plus partial or full retirement now.

If the extra USS at 60 is, say, £7k/year inflation-linked for life (your numbers suggest around that magnitude), then the question becomes:

Does that uplift compensate for the value of four years of reduced work and lifestyle freedom?

For many people, the value of freedom at 56–60 is disproportionately high.

---

🧠 2. Frame it as “What am I buying with the extra four years?”

If you stay until 60 at 3 days a week, you are effectively buying higher guaranteed income at 60 with your time.

Ask yourself:

• Is the extra pension at 60 worth 4 years × 3 days/week of your life?

• Would the 3 days per week feel like an acceptable routine, or would it feel like a drag?

• Do you actually want these next four years to be structured by work?

Sometimes putting a financial value on your time helps.
E.g., if the pension uplift is worth £7k/year, and you would work ~600 days (4 years × 150 days/yr), then you are trading:

~600 days of life → +£7k/year for life

Is that a trade you like?

---

💰 3. Risk perspective

A guaranteed extra USS pension has zero longevity or investment risk.

Stopping now and relying a bit more on the £500k DC pot introduces:

• investment risk

• sequencing risk if you draw early

• but also flexibility and timing control

If you’re the kind of person who values certainty, Option 1 has a big psychological benefit.
If you’re comfortable with “good enough + flexibility”, Option 2 can be more attractive.

---

❤️ 4. Health and energy perspective

People often underestimate this one.

Between 56 and 60, your health, mobility, and energy are often still very good.
Using that time for freer living can be disproportionately valuable.

Ask:
If future-me at 70 looked back, which period of life would I most regret losing to extra work?

---

🧑‍🎓 5. Identity and structure

Some people like the routine and social identity of work at 3 days/week.

Questions to test this:

• Would you miss the mental stimulation?

• Would you miss the routine?

• Would you get bored?

• Are there things you’re itching to do, but work stops you?

If you’re genuinely ambivalent about work, Option 1 gets easier.
If you’re craving a freer life, Option 2 often becomes obvious.

---

🧪 6. The “test retirement” trick

If allowed, you could experiment:

• Reduce to 2 days or even 1 day per week temporarily

• Or take an extended break (sabbatical / long leave if possible)

• Or “soft retire” and do small bits of freelance/consulting before making the hard stop

Sometimes getting a taste of semi-retirement makes the right path crystal clear.

---

🔍 7. The emotional question that often clarifies everything

If both options gave the same pension, which would you choose?

If the answer is “I’d leave now,” that tells you the real issue is fear of losing the uplift.
If the answer is “I’d work to 60,” that tells you you’re not actually ready to stop yet.

---

🧭 My neutral interpretation of your description

From how you wrote it, a few clues:

• You’ve analysed the numbers “inside out” → the financial gap is not huge enough to decide alone.

• You mention “freedom now” with a bit of emotional weight.

• You say you’d “work a little to supplement” → you’re not scared of losing all structure or income.

• You are already thinking about drawing DC early, which suggests you value flexibility.

This usually describes someone who is psychologically ready for more freedom, but feels they “should” keep working because of the actuarial uplift.

People in this situation often end up choosing Option 2 and don’t regret it.

But if you enjoy your work at 3 days/week and like the idea of winding down fully at 60, Option 1 becomes very reasonable.

---

🧘 In short

You’re not choosing between “good” and “bad.”
You’re choosing between:

Option 1:

• More guaranteed income at 60

• Defined routine

• Some loss of freedom until then

Option 2:

• Earlier freedom

• Lower USS but still ample resources

• More flexibility and optionality

A decision matrix:

Question	If “yes,” lean to…
Do I actually enjoy working 3 days/week?	Option 1
Am I worried about running out of money in old age?	Option 1
Am I craving more freedom/time/health-value now?	Option 2
Would I rather “bank” certainty even at cost of some freedom?	Option 1
Would I regret wasting 56–60 working, even part-time?	Option 2

hyubh

singhini said:

🧮 1. First, what’s the real financial difference?

It sounds like you’ve already calculated that the main difference between Option 1 and Option 2 is:

• Option 1: Higher USS at 60 because you avoid ERFs on parts of your pension by staying to age 60 with employer consent.

• Option 2: Lower USS at 60, but you gain time and possibly the ability to draw from DC earlier if needed, plus partial or full retirement now.

If the extra USS at 60 is, say, £7k/year inflation-linked for life (your numbers suggest around that magnitude), then the question becomes:

Does that uplift compensate for the value of four years of reduced work and lifestyle freedom?

For many people, the value of freedom at 56–60 is disproportionately high.

---

🧠 2. Frame it as “What am I buying with the extra four years?”

If you stay until 60 at 3 days a week, you are effectively buying higher guaranteed income at 60 with your time.

Ask yourself:

• Is the extra pension at 60 worth 4 years × 3 days/week of your life?

• Would the 3 days per week feel like an acceptable routine, or would it feel like a drag?

• Do you actually want these next four years to be structured by work?

Sometimes putting a financial value on your time helps.
E.g., if the pension uplift is worth £7k/year, and you would work ~600 days (4 years × 150 days/yr), then you are trading:

~600 days of life → +£7k/year for life

Is that a trade you like?

---

💰 3. Risk perspective

A guaranteed extra USS pension has zero longevity or investment risk.

Stopping now and relying a bit more on the £500k DC pot introduces:

• investment risk

• sequencing risk if you draw early

• but also flexibility and timing control

If you’re the kind of person who values certainty, Option 1 has a big psychological benefit.
If you’re comfortable with “good enough + flexibility”, Option 2 can be more attractive.

---

❤️ 4. Health and energy perspective

People often underestimate this one.

Between 56 and 60, your health, mobility, and energy are often still very good.
Using that time for freer living can be disproportionately valuable.

Ask:
If future-me at 70 looked back, which period of life would I most regret losing to extra work?

---

🧑‍🎓 5. Identity and structure

Some people like the routine and social identity of work at 3 days/week.

Questions to test this:

• Would you miss the mental stimulation?

• Would you miss the routine?

• Would you get bored?

• Are there things you’re itching to do, but work stops you?

If you’re genuinely ambivalent about work, Option 1 gets easier.
If you’re craving a freer life, Option 2 often becomes obvious.

---

🧪 6. The “test retirement” trick

If allowed, you could experiment:

• Reduce to 2 days or even 1 day per week temporarily

• Or take an extended break (sabbatical / long leave if possible)

• Or “soft retire” and do small bits of freelance/consulting before making the hard stop

Sometimes getting a taste of semi-retirement makes the right path crystal clear.

---

🔍 7. The emotional question that often clarifies everything

If both options gave the same pension, which would you choose?

If the answer is “I’d leave now,” that tells you the real issue is fear of losing the uplift.
If the answer is “I’d work to 60,” that tells you you’re not actually ready to stop yet.

---

🧭 My neutral interpretation of your description

From how you wrote it, a few clues:

• You’ve analysed the numbers “inside out” → the financial gap is not huge enough to decide alone.

• You mention “freedom now” with a bit of emotional weight.

• You say you’d “work a little to supplement” → you’re not scared of losing all structure or income.

• You are already thinking about drawing DC early, which suggests you value flexibility.

This usually describes someone who is psychologically ready for more freedom, but feels they “should” keep working because of the actuarial uplift.

People in this situation often end up choosing Option 2 and don’t regret it.

But if you enjoy your work at 3 days/week and like the idea of winding down fully at 60, Option 1 becomes very reasonable.

---

🧘 In short

You’re not choosing between “good” and “bad.”
You’re choosing between:

Option 1:

• More guaranteed income at 60

• Defined routine

• Some loss of freedom until then

Option 2:

• Earlier freedom

• Lower USS but still ample resources

• More flexibility and optionality

A decision matrix:

Question	If “yes,” lean to…
Do I actually enjoy working 3 days/week?	Option 1
Am I worried about running out of money in old age?	Option 1
Am I craving more freedom/time/health-value now?	Option 2
Would I rather “bank” certainty even at cost of some freedom?	Option 1
Would I regret wasting 56–60 working, even part-time?	Option 2

ChatGPT or Copilot...?

singhini

ChatGPT 

i was hoping the OP was going to respond before anyone else -----> because i don't have a clue what their going on about (i thought USS was a typing error i,e, they meant The United States USA). 

I'm super new to AI and ChatGPT (as in 2 weeks ago i discovered it when a friend and their children introduced it to me) -----> i cant believe i cut and pasted the OP's post and within seconds (i mean seconds) it posted all that stuff.

I was asking it about GILTS last night and investing.

I just asked it what the state pension is going to be next April and what will it be in 2035 if growth is 2.5% year-on-year -----> it wizzes an answer back in seconds. ------> £15,700 if your interested in knowing. 

This is no lie -----> yesterday i asked it "if i have 3 florins and 3 half crowns in my pocket, what's it worth in New Pence"  -----> FYI its 67.5p (do you remember the half penny). 

My mind is BLOWN !!!  😊

EDIT: i don't know what copilot is but im going to cut and paste into Chat GPT and then into Copilot and then send each one the others response and see what happens (This is ACE) 👍

DRS1

singhini said:

ChatGPT 

i was hoping the OP was going to respond before anyone else -----> because i don't have a clue what their going on about (i thought USS was a typing error i,e, they meant The United States USA). 

I'm super new to AI and ChatGPT (as in 2 weeks ago i discovered it when a friend and their children introduced it to me) -----> i cant believe i cut and pasted the OP's post and within seconds (i mean seconds) it posted all that stuff.

I was asking it about GILTS last night and investing.

I just asked it what the state pension is going to be next April and what will it be in 2035 if growth is 2.5% year-on-year -----> it wizzes an answer back in seconds. ------> £15,700 if your interested in knowing. 

This is no lie -----> yesterday i asked it "if i have 3 florins and 3 half crowns in my pocket, what's it worth in New Pence"  -----> FYI its 67.5p (do you remember the half penny). 

My mind is BLOWN !!!  😊

EDIT: i don't know what copilot is but im going to cut and paste into Chat GPT and then into Copilot and then send each one the others response and see what happens (This is ACE) 👍

But it did not ask you if the coins were pre1947 or pre 1920.  Could have an impact on what they are worth!

singhini

No problem Sir ----> here you go

Your friend is absolutely right — if you're talking about the collector or bullion value of the coins (what they’re worth today as silver), the year matters a lot.

✅ Why the date matters

British silver coins changed silver content over time:

• Pre-1920 coins
  → 92.5% silver (sterling silver)

• 1920–1946 coins
  → 50% silver

• From 1947 onward
  → 0% silver (they are just cupronickel)

So the melt/silver value of a florin or half crown depends hugely on whether it’s pre-1920, 1920–46, or post-1947.

---

💰 What that means for your coins

If your 3 florins + 3 half crowns are:

1️⃣ Pre-1920 (92.5% silver)

They have high silver value — often several pounds each depending on silver price and condition.

2️⃣ 1920–1946 (50% silver)

Worth less than pre-1920, but still have silver bullion value.

3️⃣ Post-1947 (no silver)

Worth only their numismatic value, usually small unless they’re rare or in perfect condition.

Im going to stop as im probably going to get told off like a naughty child

NTFI19081

thanks everyone (and chatgpt). Chatgpt says: If the answer is “I’d leave now,” that tells you the real issue is fear of losing the uplift - I would, who wouldn't all things being equal (not me). So, its a trade off. I think probably if I can go from Ft work to 3 days this may be a good compromise. 

MarlowMallard

Clearly from a purely financial perspective you're better off continuing to 60.  However it's not as big as it looks because after 67, with option (1) you'll have 31k + 12k state pension plus index-linking will be near 47k,  so most of what you take out of the DC pot will hit 40% income tax.   You can however take an extra 3.66x pension out of the DC pot to make the TFLS up to 6.66x pension, only at the point you trigger the DB pension. 

I think you're never going to end up on the breadline, it's more a question of spending plans - if you want to sail the Pacific or bike across Africa I'd be inclined to go now.  If you have elderly parents short of cash or children needing house deposits that leans towards carrying on to 60. 

One snag with 3 days a week is it often turns into 4 in practice.  I'd look at dropping to 2 days, don't take DB until 60, take some TFLS out of the DC pot or pull from ISAs to make up the income drop.