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Phased retirement

Discussion in 'Retirement' started by Beauherne1990, Nov 9, 2019.

  1. Beauherne1990

    Beauherne1990 New commenter

    I am wondering how easy this is to do..? I currently work full time as a class teacher and have been at the same school for nearly three years. I am not too keen to start all over again at another setting. I really don't think I can continue full time and hope to go down the phased retirement route next year on three days a week. However, I wonder if my request would be successful and whether I would just be offered a temporary contract at a lower pay grade. Anyone had experience of going down this route? I cannot afford to retire completely, even though it's very appealing!!
  2. diddydave

    diddydave Established commenter

    You will need the co-operation of your school. The 20% drop in salary will easily be accomplished by the 40% drop in time so you won't need to be put on a lower pay grade. Bear in mind that you may be 'expensive' but they would be able to replace 40% of your salary with a cheaper alternative so they may consider it attractive.
    yodaami2 and Beauherne1990 like this.
  3. diddydave

    diddydave Established commenter

    I do suggest you get some proper advice from someone who can go through your exact numbers with you. Most members have a falling 'final salary' portion and going part-time may have an adverse effect on this remaining part of your pension as you are losing a full year of historical revalued salaries and only adding in 60% to the new pension of what you were previously.
    Beauherne1990 likes this.
  4. Piranha

    Piranha Star commenter

    Who knows what your school would say? I had colleagues who went part time before retiring and stayed at the top of the UPR, but other schools may be less generous. You can only ask. My suggestion would be to bring the subject up informally now, and see what they say. If the response is not what you want, then you could consider a formal flexible working application.

    @diddydave has a point, and I think you should check to see if the best three years in the last ten will be lost before you actually retire. If they do, then get an expert to go through the figures with you.
    Beauherne1990 likes this.
  5. Beauherne1990

    Beauherne1990 New commenter

    Thanks for the advice. This is such a helpful forum! When mentioning an 'expert' - where might I find one?
  6. diddydave

    diddydave Established commenter

    The union had a link to the Wesleyan for impartial advice and I found their rep very able, she certainly put me on the right path to finding out what I needed and was a good sounding board for my ideas. We had an annual meeting, for no charge, and she didn't push her companies products just helped me confirm the figures I'd worked out for myself and my wife. I hear it can depend on the individual rep though and it does pay to do your own research to have the tricky "What if..." questions ready.
    Beauherne1990 likes this.
  7. Sundaytrekker

    Sundaytrekker Star commenter

    If you use the proper phased retirement route then, if agreed, it’s a reduction to your existing contract in the same role. So there won’t be a change to pay grade. You can take up to 75% of your pension doing this then continue to accrue further pension while working. That’s separate from considering how your best three years in ten might be affected. I assume you are at least taking the 75% based on current figures.
    Beauherne1990 likes this.
  8. TonyM19

    TonyM19 Occasional commenter

    Went through this twice! Once when I took 25% following a step down from SLT and more recently up to the full 75% and dropped to 0.8 Best things I ever did
    Beauherne1990 likes this.
  9. yodaami2

    yodaami2 Lead commenter

    I’ve just phased retired. On half a timetable now. Took 75% of my pension arb 3 years early. The BEST thing ever. I’ve had the best half term, so relaxed and with monies coming in from salary and pension not far off taking home what I was full time! I’m enjoying teaching for the first time since the 1980s. My school were great I just asked to drop to around 0.5 and that’s what I got and on UPS 3. And, and the lump sum was deposited in my bank account today!! Such a happy bunny. I plan to live financially as a retiree on my pension and save my salary to bridge the gap between full retirement and state pension when the old body says enoughs enough.
    Beauherne1990 likes this.
  10. yodaami2

    yodaami2 Lead commenter

    Oh sorry, advice? Just do it if you can.
    Beauherne1990 likes this.
  11. semolina29

    semolina29 New commenter

    Just read this so I'm hijacking the post. I've just dropped to 0.6 on L scale. Am I better phasing my retirement by taking some pension or managing on my reduced salary and just keep paying in till I fully retire ( probably at 57) Currently 55. I can't work out how much I'd lose or gain!
  12. diddydave

    diddydave Established commenter

    You need a couple of things...a crystal ball and someone who can go through your exact circumstances with you because there are so many different variables: your salaries over the last ten years, any breaks in service, years of service, whether you started before 2007 etc... the crystal ball is needed as you are a 'transition' member and all of that is going to change and be backdated because of the age discrimination case that the government lost.

    Firstly you have to be within 3 months of your salary reduction in order to apply.

    Secondly a competent mathematician should be able to create financial models for different options. One area of concern I've highlighted for part-time members is the effect it has on your final salary calculation because you are adding only 0.6 of what a full-time member would but your best 3-in-10 average salary is moving forward a whole year - and that, for most, means losing their most valuable year because the salaries from 10, 9 and 8 years ago - once adjusted for inflation - are normally the highest.

    I've made several spreadsheets for my own reference and they've been used by others on the understanding that they aren't guaranteed to be correct - you're welcome to make a copy and ask for more help if you'd like (they can be a little messy as I tend to think of new angles and test them out all the time)

    The first is good for working out your 'revalued' salaries and to see where your best 3-in-10 is: https://docs.google.com/spreadsheets/d/10x-lKLuc0PXi9C5JftanxmFVVh0PxNYKYEa70xljn38/edit?usp=sharing (you can get a list of these from TPS by sending them a message but it can take some time to get a reply)
  13. yodaami2

    yodaami2 Lead commenter

    The 3 in 10 problem can be offset by opting out and rejoining on the CARE scheme. Then the final salary is frozen for what it is now. That’s the advice I’ve had. The amount you’ve taken phased will increase each year in line with cpi or rpi + . My final salary dropped in September and looks to be flat for the rest of the year, that’s what made me phase and then opt out, not that I’ve done that bit yet, cos I didn’t want to confuse them too much.
  14. yodaami2

    yodaami2 Lead commenter

    Oh Be careful you can’t opt out and then phase retire!
  15. diddydave

    diddydave Established commenter

    This method of opting out and back in I think is related to the 'hypothetical calculation' and as such needs to be treated with caution. Have you had it confirmed how it will be applied to your service? From what I have read you cannot choose to be in one scheme or the other without a 5-year break and this is all a bit uncertain as those currently in the transition mix of both schemes are the ones where changes are going to be made. The main problem, as far as I can see, with the hypothetical calculation is that if you come back on a lower salary than when you had the break (and I'm not sure if this is the actual 'real' salary or the revalued best 3-in-10 - which would be about 10% higher than the real one) then all subsequent service is ignored...so in effect you would have been paying for no benefit.

    "However, if the average salary calculated up to the date of the break in pensionable (reckonable) service is greater than the average salary calculated at retirement, only pensionable (reckonable) service the member has completed in the Final Salary arrangement up to the break can be used in the hypothetical calculation." https://www.teacherspensions.co.uk/...582ca2f&hash=D701B5E70943045034C9D5F424F5A8FC
    Last edited: Nov 13, 2019
    Dorsetdreams likes this.
  16. diddydave

    diddydave Established commenter

    Just had another look at the factsheet and Scenario B does seem to be very good...and it seems it would have been best for everyone to have taken a month out of the scheme at the point they moved from final salary to career average! (I wonder if I could claim that the days I went on strike were a 'break'?)
  17. Beauherne1990

    Beauherne1990 New commenter

    Sounds ideal!
  18. HRHHenry

    HRHHenry New commenter

    If I opt out for a month now though, then opt back in, I can Phased retire in a couple of years though can't I?
  19. jmacjm

    jmacjm New commenter

    I applied for Phased retirement when in danger of burning out at the age of 56. I took this time to reduce myself in the ranks to main scale teacher with 50% TT. I also took the opportunity to start a new subject which was previously not offered. This put a spark into my step and sold my scheme to mySLT colleagues and governors. To cut a long story short I retired at the age of 62 enjoying the end of my career as opposed to crumpling at the age of 56! I was in a fantastic position of finishing strong when I had previously witnessed two former colleagues suffering as a shadow of their former selves just about collapsing over the line at 58 & 59.
    Beauherne1990 likes this.
  20. RepelloInimicum

    RepelloInimicum Lead commenter

    I started phased a couple of years ago and have decided to go altogether at the end of this academic year. This will be after I am 59, but before I am 60. If I wait and claim the rest of my pension when I am nearer 60, will my pension be a larger amount? Also, if you have been 'phasing', is it even possible to wait before you claim the remaining pension, or do you have to take it from the date you actually finish?
    I apologise if these are stupid questions, am still trying to get my head round the whole thing.

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