Retiring

RobMCFC said:
This does sound like a nice little earner. Are you saying that you can still pay into the pension whilst drawing out at the same time?
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A non tax payer can pay £2660 into a private pension each year.
The tax man adds 20% taking the pot to around £3500.
If they are over 55 they can withdraw the whole lot after 12 months and pay no tax as it is below their tax threshold of £12K. (Actually it is taxed but you claim the tax back using a standard form on the HMRC website).
Indeed they can earn up to about £8K+ and still take the pension tax free.
They can repeat this the next year etc..
The downside is it limits the annual maximum they can ever put into a pension to £4000 a year from £40,000 a year.
But if they don’t envisage ever having that much it’s a no brainier.
Basically it’s like treating the pension fund as a savings account giving 20% annual return on £2660.
Better than the pitiful returns elsewhere!
 
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denislawsbackheel said:
If she is a teacher her pension is a goldmine and you can find out a lot of info at the official site here.

Member Hub | Teachers' Pensions

Our site has been organised around our members. You can select what kind of member you are from the options below.
www.teacherspensions.co.uk www.teacherspensions.co.uk
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She is a teaching assistant, has been doing the same job for about 25 years now.
 
Tommy_Catons_Perm said:
Yes you do not have to buy an annuity and you can withdraw pension from age 55 and 25% is tax free. You can go in drawdown when each withdrawal is 25% tax free or take all 25% tax free first. I think the two ways are called drawdown and UFPLS aka uncrystallised funds pension lump sum. I don't fully understand it myself or know which is best way. It depends on circumstances. Beware you don't run out of money if you don't have other pensions like a DB scheme. You should get financial advice e
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Thank you for the reply, its much appreciated.

I should have mentioned, it is a final salary (defined benefit?) scheme. Does that mean I'm "stuck" with am annuity or can I still draw down until its gone??

(and thanks again)
 
Chippy_boy said:
There's plenty of people in the private sector who have seen bugger all pay rises over the past 10 years as well you know.

Anyway, enjoy your early retirement and your extra 15 years of relaxing compared to most of the rest of us. Most people in the private sector could only dream of this. In fact 44% of my pay at 67 would be a fucking miracle.
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They are recruiting!
 
Kazzydeyna said:
Thank you for the reply, its much appreciated.

I should have mentioned, it is a final salary (defined benefit?) scheme. Does that mean I'm "stuck" with am annuity or can I still draw down until its gone??

(and thanks again)
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A final salary or DB defined benefit schem
Kazzydeyna said:
Thank you for the reply, its much appreciated.

I should have mentioned, it is a final salary (defined benefit?) scheme. Does that mean I'm "stuck" with am annuity or can I still draw down until its gone??

(and thanks again)
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A final salary or DB defined benefit scheme is the gold standard. You can transfer it to a DC equivalent but it's not normally a good idea. You need to do some research. Look at pension wise or which for starters and get financial advice
 
abu13 said:
She is a teaching assistant, has been doing the same job for about 25 years now.
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She has a defined benefit pension.
Benefits up to 2014 are based on final salary.
Benefits accrued after 2014 are based on career average.
Once taken the pension is index linked for life.
It’s, as an IFA once told me, a licence to print money!
 
denislawsbackheel said:
She has a defined benefit pension.
Benefits up to 2014 are based on final salary.
Benefits accrued after 2014 are based on career average.
Once taken the pension is index linked for life.
It’s, as an IFA once told me, a licence to print money!
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Not exactly sure what that all means but i like the sound of it.
 
Tommy_Catons_Perm said:
A final salary or DB defined benefit schem
A final salary or DB defined benefit scheme is the gold standard. You can transfer it to a DC equivalent but it's not normally a good idea. You need to do some research. Look at pension wise or which for starters and get financial advice
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I did take mine out of a DB scheme after 38 years. I had a "C" scare and the flexibility it gives us to do things whilst we're still in our 50s is brilliant. But the whole thing is a bloody minefield and it's easy to see how some of the poor steel workers got conned.
 
denislawsbackheel said:
She has a defined benefit pension.
Benefits up to 2014 are based on final salary.
Benefits accrued after 2014 are based on career average.
Once taken the pension is index linked for life.
It’s, as an IFA once told me, a licence to print money!
Click to expand...
My dad who is nearly 80 has a DB scheme that was set up in the 1970s. The pension payments increase each year by 7% which is insane in this era of low inflation. He has been drawing it for nearly 20 years so you can imagine how much it has increased in real terms. It's too much to spend.
 
Tommy_Catons_Perm said:
My dad who is nearly 80 has a DB scheme that was set up in the 1970s. The pension payments increase each year by 7% which is insane in this era of low inflation. He has been drawing it for nearly 20 years so you can imagine how much it has increased in real terms. It's too much to spend.
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And that was another reason why I opted to come out. it allows you to "profile" how you drawdown and when. I was in line to be on £70k due to index linking when I was about 80. I'd rather have it now.
 
hampshireblue said:
And that was another reason why I opted to come out. it allows you to "profile" how you drawdown and when. I was in line to be on £70k due to index linking when I was about 80. I'd rather have it now.
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Yes there is a logic to that. I have a couple of DB schemes as well as DC schemes still paying into. I don't need to make such a radical decision. I could "profile" by drawing down DC and saving DB for later years, and/or take lump sum from DB with reduced pension.
 
Some of us remember double digit inflation.
A DB pension guarantees index linking.
 
denislawsbackheel said:
Some of us remember double digit inflation.
A DB pension guarantees index linking.
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DB schemes usually have an upper limit to index linking. I doubt there are many which go above 5% these days.
From 2030 the RPI link to DB schemes ends and they will use CPI-H instead. No prizes for guessing which is the lower measure.
 
sky tot said:
A ballpark figure , what would a financial advisor charge for one off consultation ?
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Were are you based I use Burfields based in Northwich who only charge for what they do give them a call 01606 839720
 
jaseirai said:
DB schemes usually have an upper limit to index linking. I doubt there are many which go above 5% these days.
From 2030 the RPI link to DB schemes ends and they will use CPI-H instead. No prizes for guessing which is the lower measure.
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Public sector pensions have been using CPI since 2011...
There is no limit to my teachers pension index linking.
 
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