Early Retirement

Retirement

Table of Contents

Early Retirement

Voluntary retirement from age 55 and before Normal Pension Age (NPA)

If you leave your employment, you are aged 55 or over and have at least 2 years of LGPS membership you have a right to apply for the release of your pension benefits without the need for your employer's consent. Please note that payment will be made subject to a reduction to reflect early payment of your benefits before your NPA. Your NPA is linked to your State Pension Age (SPA) with a minimum age of 65.

Important: If you are intending to retire and claim your pension from the age of 55 but before age 60, a three month notice period is required. Please contact the pensions team in writing who will provide details of the benefits payable. Should you wish to proceed payment will commence three months from the date your request is made.

Please address correspondence to:

The Royal County of Berkshire Pension Fund
Minster Court
22-30 York Road
Maidenhead
SL6 1SF

Alternatively you can e-mail us at info@berkshirepensions.org.uk 

Redundancy

If you are made redundant, are aged 55 or over and have at least 2 years LGPS membership of the Scheme you will become entitled to the immediate payment of your LGPS benefits.

Please note: In a redundancy/business efficiency situation your pension is calculated to your date of leaving and released with immediate effect without any actuarial reduction. Your benefits are not enhanced automatically to your Normal Pension Age (NPA). At their discretion, your employer can award you additional annual pension. This is a discretion your employer can use if they so wish subject to their published policy statement.

For more information on redundancy retirement please visit our Redundancy- FAQs section.

Business Efficiency

This is a term used when it is efficient for your employer (they make savings) to retire you early. This may be as a result of a re-structuring exercise or job evaluation exercise for example. If you are aged 55 or over and have at least 2 years membership of the Scheme, you will be entitled to the immediate payment of your LGPS benefits.

Your benefits will not be reduced if you are retired early on efficiency grounds.

Rule of 85 and drawing your pension voluntarily on or after age 55 and before age 60

If you have any 85-year rule protection and it is your intention to retire and claim your pension from the age of 55 but before the age of 60 protection does not automatically apply.

In order for protection to be applied in these circumstances your employer can exercise their discretion and 'switch' the 85-year rule on. Your employer is required to produce and publish a statement of policy setting out how it intends to use this and other discretions available to it under the Scheme regulations.

Rule of 85 and drawing your pension voluntarily after age 60

If you are retiring voluntarily from age 60 onwards any 85-year rule protection you have will automatically be applied to your pension benfits.

85-year rule protection is not applicable if you are retired on redundancy, efficiency or ill-health grounds.

Benefit reduction table for early retirement

If you claim your pension from age 55 onwards, before you have reached your Normal Pension Age an actuarial reduction to your benefits will be applied to reflect the early payment of your pension. The reductions are applied in line with the following percentages supplied to us by the Government Actuary's Department (GAD). The reductions below came info force from 8 January 2019. The table below displays the reduction percentages in whole years, but any reduction applied to your pension benefits will be calcualted based on your exact date of leaving the pension scheme.

Number of Years Early

Pension Reduction

Lump Sum Reduction

0

0%

0%

1

5.1%

2.3%

2

9.9%

4.6%

3

14.3%

6.9%

4

18.4%

9.1%

5

22.2%

11.2%

6

25.7%

13.3%

7

29.0%

15.3%

8

32.1%

17.3%

9

35.0%

19.2%

10

37.7%

21.1%

11

41.6%

N/A

12

44.0%

N/A

13

46.3%

N/A

If you are unclear about when your benefits are payable or the amount of reduction that may apply please contact the pensions team directly on 01628 796 668 or e-mail info@berkshirepensions.org.uk