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Phased Retirement - calculations

Discussion in 'Retirement' started by TonyM19, May 15, 2019.

  1. TonyM19

    TonyM19 Occasional commenter


    Sorry to start a new thread (I have another one on 'Opting out of Pension' going), but I'd just like people to run through my calculations for the amount I can expect from a phased retirement and I didn't want it burying in there. Just got off a long call to TP which has left me very confused. I thought I had my head around this, but clearly not.

    I'm going to round the figures off to make it a bit clearer, but here goes.

    I will have 28 years in on August 31 2019
    I took 25% phased retirement 4 years ago and had this calculated on 6 years service.
    My plan was to take a further 50% on August 31 2019
    I thought I would be claiming 50% of the years I had left after the 6 years had been deducted ie 50% 0f 22 = 11 years
    TP are telling me that I have to follow these steps to calculate how many years I use:

    Total service (28) divided by 2 = 14 years
    Then deduct how many years I have already claimed, so 14 - 6 = 8 years
    So a further 50% of phased retirement is 8 years.

    I had been using:

    Total service (28) subtract years already claimed, so 28 - 6 = 22
    Then 50% of that = 11 years.
    That would give a total of 6 + 11 years = 17 years, which is 60% of my total service

    The initial 6 years for the 25% phased + the 8 years for the further 50% phased = 14 years, which is exactly 50% of my total service. I thought they had misunderstood and were giving me the figures for 50% in total and not a further 50%.

    Their method seems a bit weird to me (especially the divide by 2 bit right at the start), but TP were adamant that that is how it is calculated. If it is, fair enough, but I'd appreciate thoughts on this.

    If I'm right, what happens next?
  2. 50sman

    50sman Lead commenter

    Doesn’t matter what we think it is what TP say that counts

    Contact TP as to what happens nexr
  3. TonyM19

    TonyM19 Occasional commenter

    Fair comment, but they didn't seem very confident on the phone about the calcs (had to keep going away checking - getting one calc out of sequence might have happened). Just wondered if anybody has just gone through it and can confirm one way or the other.
  4. Braindead101

    Braindead101 New commenter

    I can't help with the calculations, but my own experience with TP is that the advice you get is only as good as the person on the other end of the phone. It might be worthwhile giving them another call and speaking to a different person.
    TonyM19 likes this.
  5. diddydave

    diddydave Established commenter

    TonyM19 likes this.
  6. TonyM19

    TonyM19 Occasional commenter

    I did call them again and got the same message. Fair enough, if that's how it's done, that's how it's done. My method was based on the advice I'd had from the person I spoke to at TP about 6 months ago (I didn't just make it up!), so your comments about it's who you speak to are ringing pretty true.

    Its not that earth shatteringly important to me (it was one of several options and I might still go down this route) but it does look that taking phased retirement in two goes doesn't really work out as well as taking 75% might sound.
  7. TonyM19

    TonyM19 Occasional commenter

    Hmmm. The example has a 75% initial phased retirement, followed by a further 75% phased retirement. Does that mean I could request a 75% phased retirement? That would give a slightly better result than my initial calcs. Am I reading this correctly?

    75% of 28 = 21
    21 - 6 = 15 years
    Still leaves 25% of total pension in place

    Another phone call looks in order
  8. diddydave

    diddydave Established commenter

    I think you can go 'up to' 75% in total and the example they give has the person getting 75% and then those few years later topping it up to the full 75% by taking more of the intervening years that have passed. As you took 25% you have more from those early years available which is, I presume, why the calculation is a little convoluted.

    So your calculations look correct to me, but I'd get confirmation of what the 'remaining' bit will work out as.
  9. TonyM19

    TonyM19 Occasional commenter

    Called TPS again. The method I discussed leaving 15 years as the number of years the phased retirement is calculated on is the correct method ( 2 posts above). The person I spoke to went to her senior manger to confirm the calculations. They apologised for the confusion.

    Glad I didn't listen to the original advice on this thread and just accept what I was told as I probably wouldn't have taken the extra phased retirement with the figures I was initially given.

  10. TonyM19

    TonyM19 Occasional commenter

    Subsequent follow up call to let me know that all the calls I had made had been recorded and reviewed and that the final method (leading to 15 years) was correct. Filling the application form in right now :)
  11. TonyM19

    TonyM19 Occasional commenter

    Just a follow up in case anybody ends up in a simlar position. My figures came out within £2 of my calculations. Phew!

    Enjoying the day off each week and determined not to do any school related work whilst I'm off.
    Prim likes this.

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