Retirement

You can retire and receive your pension benefits from age 55 as long as you have two years qualifying membership in the scheme.

Your pension benefits will not be redcued if you take them from your NPA. For benefits built up from April 2014, your NPA is the same as your State Pension age, but is at least age 65. The NPA for benefits built up in the LGPS before 1 April 2014 is protected, for most people the protected NPA for these benefits is 65.

If you were a member of the LGPS at any time between 1 April 1998 and 30 September 2006, some of your benefits could be protected by the 85-year rule.

If you choose to take your pension before your NPA, it will normally be reduced because it is being paid early and therefore longer than expected. The earlier you take your pension, the bigger the reduction will be.

If you built up pension benefits before 1 April 2014 as well as after 31 March 2014 you must take all of your benefits when you retire.

Don’t forget that if you have registered for My Pension Online you can calculate your own pension benefits at any time and as often as you like.

The Government has announced the earliest age that you can take your pension will increase from age 55 to 57 from 6 April 2028.

This is the normal retirement age for benefits built up before 1 April 2014. If you take your benefits from age 65 any benefits built up before 1 April 2014 will not be reduced but benefits built up after 31 March 2014 will be reduced. If you were a member of the LGPS at any time between 1 April 1998 and 30 September 2006, some of your benefits could protected by the 85-year rule.

Don’t forget that if you have registered for My Pension Online you can calculate your own pension benefits at any time and as often as you like.

Flexible retirement is a way to move gradually into retirement by allowing you to access your pension benefits and continue to work.

You can take flexible retirement from age 55 onwards and you have at least two years qualifying membership of the scheme. Your employer must agree to flexible retirement.

Under flexible retirement, you must reduce your hours or move to a less senior post and take the pension benefits you have built up. Your employer’s discretion policy will specify whether you need to take up a new post or reduce your hours in an existing post.

If you are interested in taking flexible retirement you should to speak to your employer. They should have a policy on this that will explain their criteria for allowing flexible retirement. The NYPF cannot provide you with an estimate of pension benefits on flexible retirement as it requires employer approval.

Your employer will automatically bring you back in to the scheme although you can opt out if you wish. You will have a new pension record and your benefits will be based on your new level of pay. If you take flexible retirement before age 65 or your State Pension age if this is later, your pension benefits could be reduced as they are being paid earlier than expected and for longer. This also applies to the benefits you will build up after your flexible retirement (if you remain in the scheme).

The Government has announced the earliest age that you can take your pension will increase from age 55 to 57 from 6 April 2028.

You must have two years qualifying membership in the LGPS to qualify for ill health benefits.

Your employer must be satisfied that:

• you are permanently unable to do your job until your Normal Pension Age (NPA), and
• you are not immediately capable of undertaking gainful employment.

Your employer must get the opinion of an independent occupational health physician appointed by them before making a decision.

For benefits built up from April 2014, your NPA is the same as your State Pension age. Gainful employment is paid employment for at least 30 hours a week for a period of at least a year.

Ill health benefits can be paid at any age and are not reduced on account of early payment. Your benefits could be increased depending on the ‘Tier’ of benefit that is awarded.

The different levels of benefit are:

• Tier 1: If you are unlikely to be capable of gainful employment before your normal pension age. Ill health benefits are based on the pension you have already built up in your pension account at your date of leaving the scheme plus the pension you would have built up had you been in the main section of the scheme until you reached your normal pension age.
• Tier 2: If you are unlikely to be capable of gainful employment within 3 years of leaving, but are likely to be capable of doing so before your normal pension age. Ill health benefits are based on the pension you have already built up in your pension account at your date of leaving the scheme plus 25% of the pension you would have built up had you been in the main section of the scheme until you reached your normal pension age.
• Tier 3: If you are likely to be capable of gainful employment within 3 years of leaving, or before your normal pension age if earlier. Ill health benefits are based on the pension you have already built up in your pension account at leaving. Payment of these benefits will be stopped after 3 years, or earlier if you are in gainful employment or become capable of such employment, provided you have not reached your normal pension age by then. If the payment is stopped it will normally become payable again from your normal pension age but there are provisions to allow it to be paid earlier. Details would be provided at the time.

If you carry on working in your job after your NPA you will continue to pay into the LGPS, building up further benefits. When you retire your benefits will be increased to account for late payment. Your pension has to be paid by your 75th birthday.

To get an estimate of your pension benefits (at any time and as often as you like), please visit My Pension Online. If you haven’t already registered for My Pension Online we would strongly suggest registering before you start the retirement process.