Pension Sooner or Later??

benny5

I currently have the option of taking an immediate F/S pension or deferring until later; both options guaranteed RPI (max. 5%.)

The scheme is currently under review and the existing conditions may not prevail ‘post review’, hence my inclination to draw it in the very near future.

I don’t really need this for a year or so and will most probably pay tax @ 22%. However my main concern is a change in the plan rules which may restrict the ‘early retirement’ option (being deferred) also the issue of the RPI max 5%, even if not, it could make the early retirement reductions less favourable.

The current reductions are as follow and on the face of it I am unlikely to loose out too much by taking it now – unless I am missing out on something.

Age

---

Mod Factor

---

% Payable

---

Reduction per year
58

---

0.330

---

67.0%
59

---

0.294

---

70.6%

---

3.6%
60

---

0.255

---

74.5%

---

3.9%
61

---

0.212

---

78.8%

---

4.3%
62

---

0.166

---

83.4%

---

4.6%
63

---

0.116

---

88.4%

---

5.0%
64

---

0.061

---

93.9%

---

5.5%

lilac_lady

If your scheme is "under review" you can take it that the changes won't be to your advantage as companies are trying to save money on their pension schemes. I'd take the early pension simply because "a bird in the hand " etc. I'm not able to advise you on figures etc but my opinion is to take the money and invest it till you need it.