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Discussion in 'Retirement' started by razziegyp, Jun 16, 2011.
Would somebody explain the benefits of taking an actuarily reduced pension please?
You get it sooner but reduced. In my opinion, it is a price worth paying and I am in the process of applying for it at the ripe old age of 56. Personally, I prefer to spend my time doing other things and am prepared to take the financial hit.
Check the TPS website.
Thank you. What I don't understand is this: some posters on here say things like 'I'll take ARB then work part-time/full-time afterwards, as it suits me' ......but surely you have to resign your job and stop work to get your pension, so how are they going to get another job, let alone a full-time one, at a couple of months short of their 60th birthday.....who is going to employ them??
I suspect some teachers have reached a deal with their existing employers and are, in effect, keeping their old job. I think there has to be a gap of at least one day before they start their "new" job. For my part I see no reason to break into a prison from which one have just escaped!
Yes that is true. The benefit is that you can earn and get your pension. If you go after 60 then if pension and earning amount to more than full time earnings they take the extra off your pension. ARP means you could earn more and teach less!! You can take it right up to a couple of days before you are 60 so that would not be much of a reduction.
Some people do supply.
I took it at 55 following redundancy, no regrets and am lucky enough to be getting regular supply in a local school. Although, today was rough! I just have to think of the money and have a glass of wine...
So you have plenty of time to work out your best option. Working past 60 without taking the pension means that you will lose 5 months pension which you never get back. So you end up working for 5 months for just over half pay ( your salary minus the pension you would have got ).
Colin I am soooooo sorry to be so thick! Can you explain this last comment of yours please? Where do 5 months come in? DO I have options? Can I take my pension before I'm 60 even though I'm still working till July? Please help this bear of little brain!
I am taking my pension at 56. Yes, I'll lose 20% of what I would have got at 60 but I'm taking 80% for an extra 4 years. It means I never have to work full time again, I can work on supply and never have to do any more planning, reports, Ofsteds, stupid staff meetings, Inset days....... need I go on? That's the advantage.
I'm applying for ARP for October. Is it too early to get the ball rolling and apply now?
My thoughts exactly.
I want the money and, more importantly, the time now to do other things. Not in the future but now.
The easy option is working the full year untill 31 Aug and start the pension on 1st Sept. You lose you pension for May-Aug which is 4 months not 5!.
But if you were to resign say at Easter and get your job back after a gap of 1 day, you could get your pension on time and still earn your full salary for the last term. Clearly you would have to check this out with the school first, if they dont want you to leave in the middle of the year they might go along with this.
During the last term you could even start a second TPS pension which you could claim in September. So long as your total payments of salary plus pension in any year, April-March , is less than your total salary you would not get any abatment of your pension.
There may be other options which work better so get some advice.
Do remember that you don't have to actually take your pension; if you have savings and can afford to, you could stop work and live off your investments, or go part-time and live off savings, until the time you actually need to take the pension. Each year you don't take a pension is worth about 5% of ARP. The fly in the ointment with this is you never know what dastardly plans the Government have for pensions, and how quickly they might introduce any new rules when they finally decide how they will screw teachers for more money.
That was another reason I decided to take it now. In a year's time they may actually have withdrawn the right to take it early. I simply could not go on until 60. Now I could take an easier job full time at less money if I want to and still survive financially.
Colin, I have enquired about this retiring early/have a day's break in service/get your job back again for the last term scenario that you advise and it's not possible for me. My headteacher 'took advice' from human resources at County Hall and they are strongly advising heads NOT to allow people to do it. They say it opens all sorts of issues around possible redundancy- and they won't support any school /head in the county who allows it. (Dorset) Faced with that my head said no. So I'm screwed there.Twice damn. So I either have to go back on my promise to stay on till July and leave at Easter (I take Yr 6 so this would be very unfair) or go on till next July and lose a fair bit of money. Can you explain that bit for me please?
So you end up working for 5 months for just over half pay ( your salary minus the pension you would have got ).
(I do understand the 5 months was meant to be 4)
Why can't I just carry on getting my salary till August and then my pension from September 1?Thanks for this help, you have been kind.
You can. All he means is that you won't have claimed your pension from May and won' t ever get that bit back again. But if you are happy to keep going until July don't worry about it.