When you plan for your retirement, there are many things to consider, such as:
- whether you will have sufficient income
- your other pension entitlements and
- whether to convert part of your pension benefits to a one-off tax free lump sum
Video: Life after work
This video explains how and when you can take your pension, how different types of retirement may apply reductions or increases and how you can release some of your pension as a tax-free cash lump sum. For subtitles select ‘CC’ (closed captions).
Independent financial advice
Although we can help you by providing information about your options from the Local Government Pension Scheme (LGPS), we can't advise you about your own individual circumstances, so you may consider contacting an independent financial advisor for help.
Citizens Advice have guidance on obtaining financial advice that you may find useful.
Tracing lost pensions
If you're not sure of your other pension entitlements or need to trace pensions that you don't have the details for, you can find your pension scheme contact details on the GOV.UK website. As long as you know the name of the employer or pension provider, you'll be able to find the contact details you need to begin your search.
Tax free lump sums
In addition to their annual pension, some members who were in the LGPS before 1 April 2008, will have a one-off tax free lump sum automatically included as part of their benefits when they retire.
All members, however, have the option to convert part of their pension to a tax free lump sum when they take their benefits. For information about converting pension to a cash lump sum and the tax implications of doing so, see our information about lump sums and tax.
How to increase your pension benefits
If you want to take advantage of tax efficient ways to increase your pension savings prior to retirement, you can purchase additional pension contributions (APCs) or additional voluntary contributions (AVCs).
How your pension is worked out
Any pension benefits which you built up to 31 March 2014 when the LGPS was a final salary scheme are still calculated using your final year's pay, or either of the preceding 2 years pay, whichever is the highest. If you've previously experienced a decrease in your pay, see our information about changes in pay, as you may be eligible to apply to your employer for pay protection of your final pay.
Since 1 April 2014 all members' LGPS pension benefits have been built up in the Career Average Revalued Earnings (CARE) scheme.
See our information about how your pension is calculated.
When you'll receive your pension
It's important to note that when you leave your post and opt to take your pension, it may be 2 to 3 months before you receive your first pension payment. This is because the accurate calculation of your benefits depends on the pay information we receive from your employer up to you leaving your post. If you are due a lump sum payment this may be paid to your bank account quicker than your pension, but no sooner than the date your pension benefits are due to commence.