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What am I missing?

14 Oct 2020, 20:36

Still contemplating next steps in terms of retirement. My pension seems to be growing at around £1300 per year but if I were to go I would get a supplement of around £1200 which effectively makes it equal if I were to go in the next 12 months. I recognise that a second year would make the gap wider but I really can't see me in the job for another two years so the point is moot. I also recognise the supplement goes at 67 so every year after that I would lose the £1200 but then a £7k state pension kicks in so I'm not sure I'll feel it. What have I missed?

What am I missing?

14 Oct 2020, 21:55

freespeech wrote:Still contemplating next steps in terms of retirement. My pension seems to be growing at around £1300 per year but if I were to go I would get a supplement of around £1200 which effectively makes it equal if I were to go in the next 12 months. I recognise that a second year would make the gap wider but I really can't see me in the job for another two years so the point is moot. I also recognise the supplement goes at 67 so every year after that I would lose the £1200 but then a £7k state pension kicks in so I'm not sure I'll feel it. What have I missed?


If you get the full state pension then it's more like £9k. When you say what am I missing, what do you mean exactly? Tbh, I think time is more important. People should consider their retirement a good few years before it happens. To me, it is a sign of being positive. You will soon hit 70 and wonder where the time has gone. I fully intend to go at 60. Yes I know, some days I might be a bit bored. If your health deteriorates then you'd wish you'd gone earlier. I started paying AVCs late. The pot is worth between £70 to £98 per week currently, depending on how long I stretch it. Not sure if that was the answer you were looking for, but hope it helps.

What am I missing?

15 Oct 2020, 04:38

Ultimately retirement is a financial decision – you can't do it unless you can afford to!
But it's also a life choice, and nobody on an anonymous internet forum can tell you whether that's the right thing for you to do or not.

Personally I'm planning on going at 55.
I know I'll be in a better financial position if I stayed on, and I haven't ruled out getting a little part time job afterwards, but RM have already had over 30 years out of me and they're not going to get too many more!
For me everything fits in quite nicely at 55, both financially and as a person. I just need to see out the next 2.5 years and I'm gone.

But obviously everyone will be different, and it's all about getting the balance right for you!

As heapsy says, the full rate of the state pension is currently £9,100, so if yours is less, it will be possible to buy qualifying years that you miss before you reach state pension age. You should get your money back after about 3 years or so of reaching SPA, making it a good deal for most people.

What am I missing?

15 Oct 2020, 09:48

RobertT wrote:Ultimately retirement is a financial decision – you can't do it unless you can afford to!
But it's also a life choice, and nobody on an anonymous internet forum can tell you whether that's the right thing for you to do or not.

Personally I'm planning on going at 55.
I know I'll be in a better financial position if I stayed on, and I haven't ruled out getting a little part time job afterwards, but RM have already had over 30 years out of me and they're not going to get too many more!
For me everything fits in quite nicely at 55, both financially and as a person. I just need to see out the next 2.5 years and I'm gone.

But obviously everyone will be different, and it's all about getting the balance right for you!

As heapsy says, the full rate of the state pension is currently £9,100, so if yours is less, it will be possible to buy qualifying years that you miss before you reach state pension age. You should get your money back after about 3 years or so of reaching SPA, making it a good deal for most people.


Yes, not sure why I quoted the wrong state pension figure. I'm on track for the full rate. I am 55 in April and am considering going then. My LS will pay off my mortgage and the reduced pension is a similar figure to my outgoings now less the mortgage so overall I should be in the same position. My question related more to the fact I could leave the pension for another year and probably gain around £1400 but if I took it at 55 the supplement is an additional £1200 so overall not too different. Hope I've explained it better.

What am I missing?

15 Oct 2020, 16:34

For me in pension terms retiring at 55 is like the “Holy Grail” - great if you can achieve this, but it’s not easy to do so. The years 55 - 70 are your key retirement years when your health (fingers crossed) should still be okay. For many boomers 55 was achievable as they had gold plated pensions, however now this is not the case for many people.

Ideally, I want to retire at 55, but realistically I am probably looking at 57/58. My health is good though, so I plan on making the most of it. I am considering moving abroad to Cyprus and my partner is slowly coming around to this idea. If I don’t move, it will be 3-4 holidays a year, ideally with plenty of winter sun.

My advice to any of the younger members on here is to put as much into pensions as you can afford without it affecting your desired standard of living. The tax breaks from the government are still favourable for pensions, use them they whilst they are on offer.

What am I missing?

15 Oct 2020, 17:14

freespeech wrote:
RobertT wrote:Ultimately retirement is a financial decision – you can't do it unless you can afford to!
But it's also a life choice, and nobody on an anonymous internet forum can tell you whether that's the right thing for you to do or not.

Personally I'm planning on going at 55.
I know I'll be in a better financial position if I stayed on, and I haven't ruled out getting a little part time job afterwards, but RM have already had over 30 years out of me and they're not going to get too many more!
For me everything fits in quite nicely at 55, both financially and as a person. I just need to see out the next 2.5 years and I'm gone.

But obviously everyone will be different, and it's all about getting the balance right for you!

As heapsy says, the full rate of the state pension is currently £9,100, so if yours is less, it will be possible to buy qualifying years that you miss before you reach state pension age. You should get your money back after about 3 years or so of reaching SPA, making it a good deal for most people.


Yes, not sure why I quoted the wrong state pension figure. I'm on track for the full rate. I am 55 in April and am considering going then. My LS will pay off my mortgage and the reduced pension is a similar figure to my outgoings now less the mortgage so overall I should be in the same position. My question related more to the fact I could leave the pension for another year and probably gain around £1400 but if I took it at 55 the supplement is an additional £1200 so overall not too different. Hope I've explained it better.

With inflation rates currently very low, a similar gain on your pension by 31st March 2021 is unlikely.

But from what you say, your figures seem to make sense for you, so ultimately it's up to you whether you want to take the plunge.

What am I missing?

19 minutes ago

I had an interesting reply from PSC about my pension and the variation between the annual statement and the quote that I had to take my pension on 3/4/21. Obviously this years statements run to 31/3 (although the cabinet office one is dated 1/4). PSC advised that the differences are because of TWO rises and not the one I had factored in. They would be on 1/4 this year and the same date next year.

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