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Pension at 55

12 Feb 2020, 06:47

What can I look like getting for lifting my pension with 38 year service?

Pension at 55

15 Feb 2020, 13:37

A bloke in my office who turned 55 with 30 years service allegedly got roughly £32k lump sum and £400 a month payment.

Pension at 55

15 Feb 2020, 14:32

moug26 wrote:What can I look like getting for lifting my pension with 38 year service?


Check your annual pension statement, this will show you what your pension will be at your normal retirement age. For age 55 there is a 25% reduction for early payment, this will be useful as a guide.

For the exact figures just contact the pension centre.

Pension at 55

15 Feb 2020, 17:02

Bahia Feliz wrote:A bloke in my office who turned 55 with 30 years service allegedly got roughly £32k lump sum and £400 a month payment.



£400 a month is not much.

Pension at 55

15 Feb 2020, 17:28

Bahia Feliz wrote:A bloke in my office who turned 55 with 30 years service allegedly got roughly £32k lump sum and £400 a month payment.


Did he allegedly take both his 60 and 65 pensions?

Pension at 55

Yesterday, 07:22

NWpostie wrote:
Bahia Feliz wrote:A bloke in my office who turned 55 with 30 years service allegedly got roughly £32k lump sum and £400 a month payment.



£400 a month is not much.


Depends on your circumstances. It's £4800 pa, leaving £7700 available to earn before paying tax. So if he or she can manage on roughly £1040 a month nett, they can take a nice part time job. The number of folk I know who are taking pensions and paying tax is staggering. If you can't be bothered to educate yourself about pensions, fine, but at least be tax savvy. Better still pension savvy too.

Pension at 55

Yesterday, 14:12

lordthornber wrote:
NWpostie wrote:
Bahia Feliz wrote:A bloke in my office who turned 55 with 30 years service allegedly got roughly £32k lump sum and £400 a month payment.



£400 a month is not much.




Depends on your circumstances. It's £4800 pa, leaving £7700 available to earn before paying tax. So if he or she can manage on roughly £1040 a month nett, they can take a nice part time job. The number of folk I know who are taking pensions and paying tax is staggering. If you can't be bothered to educate yourself about pensions, fine, but at least be tax savvy. Better still pension savvy too.



I would rather have a living pension even if its over £12,500 a year before tax kicks in, I've got a few years to go yet, my strategy is to go for max lump sum via my AVC and secure the highest pension monthly payment even if that puts me above the tax free band, 20% no national insurance payment will leave me 80% to spend with.

Pension at 55

Yesterday, 17:28

I don't think it's a good idea to get too bogged down with the idea of paying as little tax as possible. After all once the state pension kicks in, that's going to provide a payout of £9,100 per year / £175 per week. Based on post 6th April 2020 figures, and assuming you have the required amount of qualifying years.
The current personal tax allowance is £12,500, so if your RM pension(and/or any other income) is over £3,400 per year / £65 per week, you'll pay tax from state pension age anyway.

At the same time, you've paid into your pension, AVC's, etc for years and taken advantage of the tax breaks and you want to keep as much of that for yourself as possible.

But you also have to make sure you have a decent standard of living in your retirement too. And what's regarded as a decent amount will vary from person to person depending on circumstances, location, etc,

Personally I could live perfectly happily on £12,500 per year, and because I save heavily I effectively already do!
At the moment that is a choice I make to enable early retirement, but once I've retired I won't necessarily have a choice, so ideally I will want access to a higher income. I will have that from state pension age, but the question is how do you generate extra income before that and for how long!

That could be:
A job.
AVC's.
A personal pension to drawdown over a period of time(up to SPA).
A personal pension to provide an annuity(income for life).
ISA's, etc.

It really depends what your aims are and when you want to retire. What's right for one person isn't always right for someone else. But taking your pension early while still working, with reductions and then paying income tax on it aswell, is barmy in my opinion.

Pension at 55

Yesterday, 19:07

Steve_claret wrote:
Did he allegedly take both his 60 and 65 pensions?

No idea

Pension at 55

Yesterday, 20:44

I agree with RobertT regarding his final comment. It is a barmy idea to take your pension early and pay tax on it. It is my belief that some people think their pension is going down in value. Not true. However, I'm of the opinion that this is what people are thinking, due probably to the complexity of our pension. It is true that each section of the pension is not as valuable as the previous one, maybe this is giving people the wrong impression. I also believe that people do not understand the DB scheme statements. They see a figure, let's say £140,000. They are maybe 55 or 56 years of age. Upon reading how the pension is calculated, ie. divided by 20, alarm bells begin to ring as they think they might not live 20 years after retirement and so take the pension early because, and I quote one colleague I overheard talking to another, "you've put all that money into your pension". Both those colleagues have taken their NRA60 pensions early and continue to work in the business. Maybe some think that their pension stops after 20 years. WRONG! It continues as long as they are living and beyond if they have a widow / widower.The figure in the statement is one calculated by an actuary, a person who deals with the workings of pension schemes. The figure is NOT actually what the person has paid into their scheme but a figure calculated as being needed to produce the pension figure at the bottom of the statement. It also allows for cost of living increases. Your pension is reduced for early payment. FACT. Your lump sum is reduced for early payment. FACT. People have argued with me to the contrary. One last point, if a person retires having taken their pension early, they will be on less money than they would have been when they retire because they are no longer receiving their wages. AND the pension they took early will be less due to the reduction. FACT.
Sorry if my post is a bit long. Not sorry if it clears up some of the rubbish people believe. Hopefully people will stop posting the same questions over and over, because they haven't read any of the previous posts by the many contributors.

Pension at 55

Today, 04:52

On the subject of how much our pensions are worth, has anybody else kept a record of how much they've actually paid in over the years, compared with how much their likely to receive?

I assume there won't be many, but I'm sad enough to have done that! :hmmmm

Up to 31st March 2018 and the closure to future accrual of the RMPP, I paid in a gross amount of just under £20,000, which factoring in tax relief and PSE equates to less than £16,000 net.

My section C NRA60 will pay about £7,200 per year from 60(inc supplement), so I will only have to draw my RM pension for 2 years and 3 months to get back the money I've paid in over 30 years of RM employment. Everything after that and for the rest of my life is 'profit'. Plus it's index linked and has death benefits!

Using the normal 20x formula, and adding on my NRA65 benefits I have a 'total pot value' of £211,000 and that's only cost me £16k!!! :cuppa

I call that damn good value for money. :wave

Pension at 55

Today, 05:41

Interesting comments which highlight one definite, all our needs are different. The one thing I think we can agree on though is taking any form of pension and paying tax - working or not. Barmy indeed!

Pension at 55

39 minutes ago

A very good point RobertT. People don't seem to understand just how little they actually have paid in. Also that you only need to draw your pension for about 3 years or so to get it all back before being "in profit" as it were.

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