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Retire at 55? Please tell me why not?

Discussion in 'Retirement' started by Steve5737, Feb 2, 2016.

  1. Steve5737

    Steve5737 New commenter

    Mortgage sorted. My wife working for another 5 years. 2 weddings to pay for but I think that's about it. Am I missing something? Would end 33 years in teaching so is a decision not to be taken lightly. Would love some thinking on this. I've done enough and think I should finish while healthy. More time for the gym too!
  2. lizziescat

    lizziescat Star commenter

    Please tell me why not?

    Only the financial viability.

    Desperately trying to think of other reasons from my experience...............

    Nope None:)
    marlin likes this.
  3. Yoda-

    Yoda- Lead commenter

    You don't know how much time you have. Healthy retirement time is likely to be shorter. You will have more quality time if you go at 55.

    If you live until your 72 then you start to loose financially due to the actuarial reduction. Will the smaller pension make a big difference to you? Probably not with your state pension on tap by then.
  4. jacob

    jacob Lead commenter

    One advantage of taking the pension is the fact it is index linked, whereas your teachers pay is not and you have been squeezed due to this governments belief in "austerity" (which has been proved wrong several times already but they are ploughing on with destroying the rest of the country).
  5. johnberyl

    johnberyl Occasional commenter

    If you live to more than 72 I think you also lose out by taking the maximum lump sum too.
  6. lizziescat

    lizziescat Star commenter

    ...or to put it another way.
    Let's say you live until you're 85.
    Retire at 60 You will be £xxxx up overall and have 25 years of stress free doing what you want
    Retire at 55 You will be £xxxx down overall with 30 years of stress free doing what you want.

    So you're 'buying' yourself an extra 5 years of 'life' for £xxxx

    As long as the financial side works (without giving a different kind of stress) I know which I'd do.

    Best wishes
  7. Dunteachin

    Dunteachin Star commenter

    I retired at 55 and have done bits of supply over the last five years to supplement my pension. Have stopped that, now I'm 60. No regrets. Had I been able to get my state pension at 60, I'd be dancing a jig, but I have to wait another 6 years.
  8. applecrumblebumble

    applecrumblebumble Lead commenter

    You will lose 20% of your pension (ARP) for the whole of your retirement but gain state pension when you reach state retirement age.

    No increase next year because CPI -0.1% in Sept. when it's calculated but at least you know, it's not a lottery unlike school pay rises.
    Consider the finances but balance against that could you work another 5 years under the current regime.
    Steve5737 likes this.
  9. heldon

    heldon Occasional commenter

    This is a good debate. I am 54 next so getting to the point at which there will be choices. Just need to work out how much income is enough? At present looking to do another 3 years ish. But inflation in 2008 was 3.2% and this drops out of the calculation from April 2018. Uplift currently helps as my latest valuation was 10% above my current salary. This will change after April where it will reduce a bit because of this year's 0% cop figure. Will need to check each year and do the sums. Really don't want to do supply, would rather hang on in until I can break free and discover what makes me tick again. So how much is enough?
  10. Steve5737

    Steve5737 New commenter

    Just attended a retirement seminar. The TPS forecast is based on March 2015 statement, nearly a year out of date. Sill question, but when are new statements issued? April I guess?
  11. Steve5737

    Steve5737 New commenter

  12. Steve5737

    Steve5737 New commenter

    Really interesting answer. Does that make the suggested salary figure on a pension statement be likely to fall when next issued?
  13. suzuki1690

    suzuki1690 New commenter

    Your pension is either based on your last salary or the best 3 salaries in the last 10 years. My pension was based on a higher salary than i had ever earned because they took inflation into account for my best 3 years in the last 10. I was told that most people have their pension based on the best 3 years out of the last 10 adjusted for inflation. It just shows how our earnings have fallen in the last 10 years compared with inflation. My pension was based on a salary of £3000 more than i earned when i retired 3 weeks ago.
  14. applecrumblebumble

    applecrumblebumble Lead commenter

    Your average salary quoted is correct but then it is used for the calculation of your pension based on the number of years served.
    eg. average salary £35000 and 25 years service = 35000/80 x 25 = £10937.5 per year
    lump sum would be 3 times this (not taxable)
    If you retire at 55 then pension reduced by 20 % so pension would become £8750 per year.

    Always a year out of date since statement quoted up to March 31st of the previous year. Once you decide to retire TPS will give you an up to date figure. I think registering on the TPS website would be useful if you are planning retirement. It will allow you see all the stuff on your statement and you can see if anything needs updating like employment history etc.
  15. applecrumblebumble

    applecrumblebumble Lead commenter

    As you say in your post and if inflation stays low - average salaries in pension statements can only go down. (might be the best time to go?)
  16. phatsals

    phatsals Senior commenter

    Salary returns for TPS are made around 9th July every year. Your service is updated around August. That is as current as it can get.
  17. aspen_1

    aspen_1 New commenter

    Eventually you will gain state pension whether or not you take your teacher's pension early.
  18. catmother

    catmother Star commenter

    Suzuki,can you remember if the salary quoted on your yearly statement was already adjusted or did you see the higher one once you got your retirement paperwork?
  19. suzuki1690

    suzuki1690 New commenter

    Catmother. The yearly statement (that you get on 31 March) is based on your last salary not the best 3 out of the last 10 adjusted for inflation. There is no double about that. I asked the SPPA for an estimate if I retired on my birthday at 55 and they sent me a statement through the post that I didnt understand - ie it had me earning £3000 more than I was earning. I then made enquiries and it was the best 3 out of the last 10. When I phoned the SPPA after my birthday to check that my employer couldnt hold me to the 6 months notice they said in passing that of course your pension will be based on the best 3 out of the last 10 adjusted for inflation. It does make a wee bit of a difference to your pension.
  20. catmother

    catmother Star commenter

    Good to know. I know that you're in Scotland too, which is why I was asking as your statements would have same layout as the ones I get. Interesting info that the estimate on the statement might be less than eventual pension.

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